This is an article providing answers to the most commonly asked questions regarding online wine auctions, to help you get the most out of your BiBO Auction experience.
What is a reserve price?
A reserve price is the minimum price the vendor has chosen for the wine to be sold.
Should I place a reserve on my wine lot?
There are a few factors to consider here. Some wines which may have passed their drinking window or which may have condition issues are likely to attract more attention and bidders with a low or no reserve as this may be considered as a speculative purchase out of curiosity for example. Wines with high reserves around the market value tend to attract very little interest or a speculative low bid as buyers may consider the wine to be too expensive and they may lose interest in that wine. On the other hand, wines with lower reserves compared to the market value attract much more interest from multiple bidders looking for good value.
What is a buyer’s premium?
That is the commission charged to the buyer by the auctioneer on the Hammer Price. Our Buyer’s Premium is 12% + VAT. Traditional auction houses typically charge a Buyer’s Premium of 20-25%.
Can you store my wine for me before I am ready to take delivery?
Yes of course. We store all of our wines at LCB Vinotheque, a professional wine storage facility in Burton on Trent and we can quite happily set up a storage account for you.
Can you transfer my wine to another bonded warehouse?
Absolutely, all of our wines are stored in the perfect conditions in LCB Vinotheque and as well as duty paid delivery to mainland UK (please contact us for other locations), we can transfer your wine under bond to any designated UK Bonded Warehouse.
How do I sell my wine?
Please contact us with details of the wines you wish to sell, including the wine name, vintage, quantity, storage history and bottle condition. If the wines are stored at home, photos are also very useful in helping us accurately value the wines. We will then provide you with an estimate and valuation for the wines and cover the relevant fees:
- Seller’s Commission of 8% + VAT on the Hammer Price.
- Lot Listing Fee of £25 per lot to cover collection, warehousing, insurance.
- Optional Reserve Fee of £5 per lot.
If you are happy to proceed, we will arrange for collection or transfer of your wines to our storage facility LCB Vinotheque where they will be processed and photographed before being entered into the next auction.
What happens if two buyers bid at the same price, who wins the lot?
Very simply, our platform works on a first come, first served basis. If you place a maximum bid of £500 on a lot with a reserve of £450 at 9am on the day the auction ends, and someone else places the same maximum bid at 9.30am on the same day, your bid would be considered the winning bid as yours was received first and this would be shown as Winning when you are logged in. Conversely, if you were the second bidder, the Lot Listing would still show £500 as the Current Bid, but you would not be considered to be Winning. The only way to secure the lot would be to increase your maximum bid.
What if my wine is corked?
Cork taint is not something that can be detected without opening the bottle, and unfortunately it isn’t possible to check for cork taint prior to an auction. As there is no visible way to identify whether a wine is “corked”, we cannot indemnify against it. Wines sold at auction are sold under the premise of ‘caveat emptor’ i.e., the principle that the buyer alone is responsible for checking the quality and suitability of goods before a purchase is made. The majority of wines listed that are loose bottles and duty paid have been professionally photographed so that fill levels, colour and bottle condition are clearly visible. No refunds can be given for any wine which ultimately turns out to be corked or has some undetectable wine fault. The same applies to a wine which is considered to be “over the hill”.
Can I cancel my bid?
No, as per our Terms and Conditions, your bid is considered to be a contractual agreement, and to cancel your bid would harm the integrity of the auction as well as potentially causing other bidders to miss out. The only exception to this would be if we have made a genuine error in describing the lot or providing incorrect estimates.
What does AMS mean?
AMS stands for Auctioneer Margin Scheme, and is a method by which second goods can be sold at auction without incurring VAT at 20% on the Hammer price. Rather, the wines are taxed at a rate of 1/6 of the margin, with the margin here being what the winning bidder pays (Hammer price + Buyer’s Premium and VAT on the Buyer’s Premium) less what the vendor receives for the sale (Hammer price – Seller’s Commission and VAT on the Seller’s Commission).
In order for the wines to be eligible, they must tick a few specific boxes such as being Duty Paid and without the VAT having been reclaimed by the vendor, so wines that are listed as In Bond or those wines that are Duty Paid and being offered by a VAT-registered entity would not qualify.
The below example better demonstrates the process and calculations using our standard Seller’s Commission of 8% and Buyer’s Premium of 12%. One thing to note with the below example is that some lots operate at a fixed purchase price, rather than commission based on the Hammer Price. Please ask us if you are unsure.
For example, using a Hammer price of £100, for reference our Buyer’s Premium is 12% +VAT and our Standard Seller’s Commission is 8% + VAT:
– (a) Hammer Price: £100
– (b) Buyer’s Premium (+VAT): £14.40
– (c) Selling Price = a+b: £114.40
– (d) Seller’s Commission (+VAT): £9.60
– (e) Purchase Price = a-d: £90.40
– (f) Margin For AMS = c-e: £24
– (g) Tax of 1/6 on Margin = £4.00
Total for the winning bidder: £118.40
For comparison, if the lot was not eligible for the Scheme, the total price would be £134.40
Why is the current bid on my lot showing £5 when I set my limit higher?
The way our bidding platform works is to take your bid up to the lowest possible increment, and so if your bid limit falls below the Reserve Price, your bid will show at the lowest possible, £5. When another bid is placed by someone else, our system will increase the bid in line with the increments to either match their limit if it is below yours or to your maximum if it falls below the other bidder’s maximum.
For example, a lot has a reserve of £1,000 and you place your bid at £900. Until another bid is placed, the current bid will show as £5. If someone then places a maximum bid at £800, the current bid will increase to £1,800 and you will be the top bidder (as you placed the bid first).