Auctioneers hire bosses when they contract with sellers, says Steve Proffitt, of J.P. King Auction Co. Inc., Rainbow City, Ala.
During his July 18 presentation, “Building a Box for the Seller … and Better Sleep” Proffitt encouraged Conference and Show attendees to closely screen their sellers and to be cautious of them no matter who they are or appear to be.
Sellers, he says, have the potential to pose problems because of their personalities, assets, circumstances or expectations.
“A lot of the work I’ve done over the years with Auctioneers has involved problems with sellers,” he says. “There is no more dangerous threat for you as an Auctioneer than the seller.”
Proffitt says the best way to deal with sellers is to place them in a figurative box — with a bottom, top and four sides — throughout the auction process. The goal of an auction professional should be to cut sellers off from opportunities to attack them.
At the bottom of the box is its foundation, the auction contract, Proffitt says. All Auctioneers should have a unique contract for their specific situations.
Side No. 1 of the box is “informed consent,” which Proffitt says ensures the auction professional and seller are on the same page, cooperating and working toward the same goals.
Side No. 2 is a marketing plan and budget. He says every Auctioneer should have a written marketing plan for every auction, whether it’s one sentence or 60 pages.
Next, side No. 3 is a proclamation of “no guarantee,” which he says places the risk of an auction solely on the seller. For example, an Auctioneer does not guarantee a bid amount, offer or selling price for an asset.
The final side, No. 4, is the “integration/merger/construction” decree, which protects the integrity of the contract. It says that there is no other agreement. The contract is the sole agreement between the auction professional and seller.
A likely complaint from a seller is going to be price disappointment, Proffitt says. Therefore, forming the top of the box is Proffitt’s advice to inform the seller that he must place complaints in writing.
“You will not entertain it, let alone address it, until you have it in writing,” he says.
Then, an Auctioneer should respond to a written complaint in the same way, presenting to the seller terms that were in a signed and dated auction contract.