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Selling Jewellery - Dealers or Auctions? Diamond Ring FAQsChard 24 Carat Home Page

second hand pendant 14ct lion
Second Hand Lion Pendant

Selling Jewellery

Auctions versus Dealers
It is strange that many people automatically believe they will get a better price at auction, or that they will get a better buy at auction. While we would not argue with the theory behind auctions, that they achieve open market prices, we believe many people would get better deals selling or buying through a dealer.
Auction houses, like all other businesses face competition, and have seen expenses increase considerably in recent years. Auction houses have to spend money on producing catalogues and in advertising, otherwise they would attract no sellers and no buyers.

The Cost
First implemented in 1975 by Christie's, the assessment of a buyer's premium is about 10% to 15% with a 15% to 20% commission to the seller. There is VAT to pay on both lots of charges, which cannot usually be reclaimed, this means that the "spread" between prices the seller realises and the buyer pays can be between 23.5% (unusually low) and 41.12% (rather high), with most at about 30%. If an item sells for say £300 in actual fact the seller will only receive £240 (basing on a 20% comission) and the buyer will have to pay £345 (basing on a 15% premium).
As an example, in the past we purchased multiple lots in a (coin) auction. We paid about £95 each for the items, the vendor got about £70 each. If the vendor had approached us directly we would have been delighted to pay between £80 to £85 each, and he would have got paid immediately.

Estimation and Reserve Quotes
When you take your item to an auction house, the auctioneer will generally give you an estimation as to what you might expect for the item. They get this figure from looking at previous or similair sales. They will also encorouge you to state a reserve price, usually advising to go much lower than their estimation. Many seller's forget to take into consideration the percentages the auction house has added for their fee's plus the VAT, focusing on the 'estimation' price and expecting to receive this.

Jewellery as an Investment
If you are surprised or dismayed by any of our comments or reckonings about jewellery, and you were labouring under the misapprehension that jewellery was an investment, then you may also wish to read our page on that topic as well.
If you want to find the value of a diamond ring you own, please take a look at our page Value of My Diamond Ring

Please also see our pages on Selling Jewellery on eBay and Coin Auctions


...at the Best Possible Price

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