AMI Authorized Dealer Plan

[jbcindc]

Over the past several months I have been fascinated with the commentary on American Memorabilia (AMI) and the debate over their financial hardships and business practices. I've read the posts from Forum members who legitimately wonder why anyone would consign to them in the future or buy from them. Undecided until now on where I stood, I felt bad for the people who've consigned and not been paid, but found myself wondering why I would want to purchase from a company that has questionable business practices and a severely damaged reputation.

Ultimately I decided to bid on a couple of autographed photos and won an 8X10 in the auction ending last Thursday. The seller was operating under the "Authorized Dealer" plan and I was directed to make my payment directly to him. My winning bid was $20 and with the hammer fee and shipping came to $37.13 -- 85% of the purchase price. I'm happy that my purchase helped out someone trying to recover money owed them, but why in the world would I buy anything else? (rhetorical question).

Presumably the AMI rebuild plan doesn't include their buyers coming away from an auction feeling cheated; but I'm not privy to their ownership meetings. However, as a buyer I'm turned off by the feeling that AMI expects me, the buyer, to make their delinquent accounts whole by charging exorbitant shipping fees. They could at least take me to dinner and a movie before presenting me with their final price.

I paid the invoice because in the end it wasn't worth arguing over. But it does help me answer my question about whether or not to continue to business with AMI. I hope this Authorized Dealer plan works for Forum members still owed money; I've made my first and last contribution to the plan.

Jason

[TNTtoys]

My winning bid was $20 and with the hammer fee and shipping came to $37.13 -- 85% of the purchase price.

I read through your rant and honestly don't understand why you're making a big deal out of $17.00, which is comprised of the buyers premium and the shipping. As an auction house customer, I have come to expect a "minimum" buyers premium on cheap items. For example, Heritage charges a flat rate of $9.00 if the percentage of the final price does not exceed $9 on its own. I think that this concept in itself is a fair one, as there are overheads that go with this method of selling, and I don't think $2-4 cover it. I have also grown accustomed to shipping costs in the $10-12 range for a single item won in an auction. So, going back to my example of Heritage Auctions, I would have paid $20+$9+$12, or $41.00. Alternatively, on a $50.00 item, I would have paid $50+$9+$12, or $71. The larger the item is, the more your "percentage overhead" comes down... and it doesn't really matter which auction house sells it.

[jbcindc]

TNT,

Rant, eh? And I thought I articulated my point fairly well.

I understand the value of the economies of scale in auction house purchasing. I generally purchase higher priced items and the shipping fees by comparison don't seem nearly as exorbitant. I had placed bids on another photo in AMI's auction but only won the one photo. However it's judged by common auction house practice or otherwise, I came away from the auction feeling like I was being gouged for one item and it made me not want to buy from them again. Perhaps it's my ignorance of buying lower priced items from auction houses; I just haven't done it and don't see myself repeating the mistake. However, if you're a business and the attitude of enough of your buyers is that they will come away from a transaction with you vowing not to buy again, you've developed an excellent going out of business strategy. I am a buyer of that opinion.

I appreciate your points on overhead, etc., but AMI didn't incurred any overhead when the seller maintained possession of the photo and sent it himself. As it turns out, I've purchased from this seller before on e-bay and never paid shipping that high. Certainly in this case the seller hasn't incurred any tangible overhead costs beyond his regular business through e-bay. The shipping didn't somehow become more difficult because the item was purchased using an auction house as a front as opposed to e-bay. Possibly the only reason that seller would use the AMI Authorized Dealer plan is to recoup money that AMI owes them. My perception is that money is being recouped at a faster pace when you pass on higher costs to the buyer. Perhaps this is an unintended consequence of the Authorized Dealer plan.

I don't think it's a question of right or wrong on either of our positions regarding fees. As you said, you've come to accept the high shipping fees that I find difficult to accept. I believe shipping should be based on the actual cost of shipping and handling. It is true that AMI does typically charge a $10 flat rate per sale which is not included in the invoice -- just the $13.13 shipping fee. So maybe it all balances out in some way.

Having been a vicitim of AMI's "hidden reserves" uplifiting several of my bids not too long ago, I had to really think about whether or not to bid again with them. I did and came away from the transaction angry. I'm probably more angry with myself and can see how my post could come across as a rant.

I appreciate you taking the time to reply and hopefully this post didn't turn into a rant.

Jason

[TNTtoys]

TNT,

Rant, eh? And I thought I articulated my point fairly well.

I understand the value of the economies of scale in auction house purchasing. I generally purchase higher priced items and the shipping fees by comparison don't seem nearly as exorbitant. I had placed bids on another photo in AMI's auction but only won the one photo. However it's judged by common auction house practice or otherwise, I came away from the auction feeling like I was being gouged for one item and it made me not want to buy from them again. Perhaps it's my ignorance of buying lower priced items from auction houses; I just haven't done it and don't see myself repeating the mistake. However, if you're a business and the attitude of enough of your buyers is that they will come away from a transaction with you vowing not to buy again, you've developed an excellent going out of business strategy. I am a buyer of that opinion.

I appreciate your points on overhead, etc., but AMI didn't incurred any overhead when the seller maintained possession of the photo and sent it himself. As it turns out, I've purchased from this seller before on e-bay and never paid shipping that high. Certainly in this case the seller hasn't incurred any tangible overhead costs beyond his regular business through e-bay. The shipping didn't somehow become more difficult because the item was purchased using an auction house as a front as opposed to e-bay. Possibly the only reason that seller would use the AMI Authorized Dealer plan is to recoup money that AMI owes them. My perception is that money is being recouped at a faster pace when you pass on higher costs to the buyer. Perhaps this is an unintended consequence of the Authorized Dealer plan.

I don't think it's a question of right or wrong on either of our positions regarding fees. As you said, you've come to accept the high shipping fees that I find difficult to accept. I believe shipping should be based on the actual cost of shipping and handling. It is true that AMI does typically charge a $10 flat rate per sale which is not included in the invoice -- just the $13.13 shipping fee. So maybe it all balances out in some way.

Having been a vicitim of AMI's "hidden reserves" uplifiting several of my bids not too long ago, I had to really think about whether or not to bid again with them. I did and came away from the transaction angry. I'm probably more angry with myself and can see how my post could come across as a rant.

I appreciate you taking the time to reply and hopefully this post didn't turn into a rant.

Jason

Jason,

I have to be brief here because I am preparing to leave for the day. I think the bigger issue here is not the additional couple of dollars that are tacked on for buyers premium or shipping -- when all is said & done, I include all that in my final price, and if need be, I reduce my final bid to allow for the extras. Not easily done on cheaper items, but worth a consideration nevertheless.

The big issue here is not over dollars & cents. It's fundamentals -- you clearly do not have a good taste in your mouth because you claim to be the victim of business practices that have not exactly been above board (hidden reserves). I don't know whether or not this is fact but I would certainly shy away from doing deals with any company who treated me that way in the past -- no matter how much I wanted the item they had to offer. Again, my reply is not specific to any auction house. What I'm saying is that if I am treated badly by a company, that company has lost my future business... because I know the way that I am... if I were ever to enter a transaction with them again, I would in the back of my mind be looking for things that probably aren't there. You know, "once bitten, twice shy."

Nick

[jbcindc]

Nick,

Your last post pretty well sums it up.

Thanks,

Jason