Minimum bids

Help Support CattleToday:

Thanks Frankie, I get it now.

I dont think I've ever seen a minimum bid before, although now that I just typed that I realised one of the goat auctions I go to, before the sale the reserves on the bucks are made public. So I guess that might be similar, except bidding can start under.

Mostly with our auctions, the auctioneer starts the bidding at the reserve price, and most of the time no one bites, so he lowers it and once the bidding gets going, it usually goes up and over the price he started with. If it doesnt, he will just pass them in (I'm not sure that I've seen an auctioneer give out a fictional buyer number before either) and they generally sell for the reserve price privately after auction.
 
As a buyer I'd prefer a minimum bid to a floor. Nothing rubs me the wrong way more than bidding and not winning. At least a minimum bid is straight up. Unless you make people aware of the floor . . . which would simply create a minimum bid. Eventually I won't go to sales with minimums unless they are posted because I really dislike putting the time in and not knowing your bid will go.

As a seller, I could see why a floor is important but I think they will ultimately hurt sales more than opening minimum bids.
 
novatech":as8f0urx said:
SRBeef":as8f0urx said:
If an auctioneer can start bidding under the "floor" but the seller will not accept any selling price under the "floor", doesn't the floor really become a minimum bid that can actually purchase the animal? Why would I place a bid under the floor price if I know I can not buy the animal for that - might just as well start at a minimum bid that could buy the animal?
Click to expand...
With a floor usually no one knows where the minimum is. So the auctioneer can start low, get people bidding and try and work up past the floor. If it does not reach the floor/minimum the auctioneer may announce no sale or may give a fictitious buyer number.
With a minimum bid everyone knows where the starting point is.
I have seen auctioneers start an animal high, or about what the animal should bring, and receive no bid. They then drop the starting bid to what ever someone will start at. Once bidding starts the price will often go above the auctioneers original starting price.
This is probably some sort of mental thing. The auctioneers starting price sets a value up for the buyers. Anything below that is a steel. Once the bidding is in motion it almost becomes a competition between buyers.
Click to expand...

Thank you for the clear explanation. The difference between a floor and a minimum bid is that the bidders KNOW where the minimum bid is and they DON'T KNOW where the floor is.

Then is the "reserve" the same as a "minimum bid"?
 
I can understand a minimum bid, but I rarely buy at an auction that has one. I also understand the floor, but one thing that I can not tolerate is auctioneers pulling phantom bids out of thin air. I have left more than one guy holding the bag on that. What they will do is look to their ring man to save them and he will pretend that there was a mistake, pick some guy out and act like he thought he was in. Then they will go back to me. I say no. Unless I can see my competitor bidding, I quit. Nowadays they will act like they have someone on the phone or internet. Many of them seem to be crooked.

I would rather that everything was out in the open, like with the minimum, the problem is that most of them set their minimums too high.
 
I was at a Red Angus auction last year that had a $1500 floor but nothing was said in the catalog. After the auction talking with the neighbors I found out that only 70% of the bulls in the sale sold. The day of the auction I thought every bull sold and the market was $1500 and up. I wasn't thrilled about this and probably will never buy there again. If they didn't bring the money they should have just said no sale and bring the next bull in instead of leaving the impression that your going to have to pay more than the public thought they were worth to buy there.
 
I think $1500 is too steep a minimum; but I like the idea lof setting a published minimum number before the sale in principle. The Auburn Bull Test Sale had an $800 minimum ~18 years ago I know. I attend a lot of horse sales and see horses go all the way down too $100 then come up in $50 increments with the auctioneer doing a whole lot of work. Then when the guy thinks he has bought the horse the owner will "no sale" the animal. We just wasted 10-15 minutes looking at a horse that nobody would have bid on or looked twice at IF the reserve had been known when he walked in the ring.
 
I dont like it a bit. Why even have an auction? They might as well put a price tag on them and invite everybody to the farm.
 
Sage":2imiall8 said:
I was at a Red Angus auction last year that had a $1500 floor but nothing was said in the catalog. After the auction talking with the neighbors I found out that only 70% of the bulls in the sale sold. The day of the auction I thought every bull sold and the market was $1500 and up. I wasn't thrilled about this and probably will never buy there again. If they didn't bring the money they should have just said no sale and bring the next bull in instead of leaving the impression that your going to have to pay more than the public thought they were worth to buy there.
Click to expand...

That would rub me the wrong way, too. I have nothing against a floor price as long as it is disclosed ahead of time and reasonable. No fake numbers, no mystery bidders, that's just dishonest. I think it hurts certain animals to set too high a floor price as certain folks looking for a cheaper bull may not bid on that bull if the starting price was too high and two or more persons would be inclined to bid if the animal started a couple hundred bucks lower.
 
I know, that is what kills me. If they would just play it honest, they could end up with it way above any minimum, but if I think that a cow is worth $1200 and they won't start her at anything under $1500 I don't bid. I may have gotten carried away if she started at say,,,, $900 and me and several others got on her and ran her up. They will get no help from me starting at a high floor.
 
a floor bid around here would go over about like a lead ballon.an it would get you alot of no bids an no sales on bulls.people dont like being told what the opening bid is.
 
When I take a registered animal to a consignment sale, I give the auctioneer the lowest amount I will sell the animal for. Most of the time I have legitimate bids from home that I give him. If he can't get a bid for that price, I walk the animal out of the ring and take it home. No fake buyers. I have had people come to me after the sale and ask for my bottom price. Several times I have had people buy bulls from me out back of the sale barn for the price I asked. I am in business to make money. I'm not going to sell an animal for $500 less in an auction than I can get at home in private treaty. Too many things can happen that affects the turnout, type of crowd, or bidding in a consignment auction.

I won't sell any bull for less than $1500. I sell butcher steers for $1300, so why would I sell a bull for less? I'll eat him before I give him away. If someone won't come to an auction because there is a $1200-1500 floor price or minimum bid, I don't want them to come look at or buy my bulls. They are the same ones who buy a yearling bull from someone, put him out with 40 cows and don't feed them anything or take care of them. Then they come back and complain that the bull fell apart on them.

Those of you who think a $1500 minimum price on a bull is too high haven't put a pencil to the feed cost of raising a bull, semen test cost, vaccinations, ultrasound cost, registrations, etc. Don't forget your labor cost either, unless you are donating your time to a non-profit organization.
 
I don't think the $1500 or $1800 or $2500 is the issue, the bulls are worth whatever someone will part with them for or pay for them. I just don't like the deceptive way the sales are held with fake buyers and so on. I guess I'm sold on the old way of making an HONEST living, this seems to be a rare deal lately.
 
KMacGinley":2hhp7jdo said:
Nowadays they will act like they have someone on the phone or internet. Many of them seem to be crooked.
Click to expand...

Yup. And the reverse is happening. I bid on the internet and I watch the bid go up one or two times after I quit (as if someone on the floor is bidding) and they come back and sell it to me. I've even had them tell me "you're out on the net" and end up selling it to me. The problem with the net is, bidding is a legally binding contract - you push "bid" you have to buy.
 
Elder Statesman":3tdfmykd said:
When I take a registered animal to a consignment sale, I give the auctioneer the lowest amount I will sell the animal for. Most of the time I have legitimate bids from home that I give him. If he can't get a bid for that price, I walk the animal out of the ring and take it home. No fake buyers.
Click to expand...

Fine, just tell me what the "reserve" is before I drive all the way to the sale to bid on something I'm never going to get anyway.
 
Sage":1kda5ago said:
I don't think the $1500 or $1800 or $2500 is the issue, the bulls are worth whatever someone will part with them for or pay for them. I just don't like the deceptive way the sales are held with fake buyers and so on. I guess I'm sold on the old way of making an HONEST living, this seems to be a rare deal lately.
Click to expand...

That is why I don't let them do the fake buyer thing and walk out of the ring with people thinking I sold the bull. I tell the auctioneer to call it a no sale, the bids didn't meet my floor price.
 
angus9259":3810r9su said:
Elder Statesman":3810r9su said:
When I take a registered animal to a consignment sale, I give the auctioneer the lowest amount I will sell the animal for. Most of the time I have legitimate bids from home that I give him. If he can't get a bid for that price, I walk the animal out of the ring and take it home. No fake buyers.
Click to expand...

Fine, just tell me what the "reserve" is before I drive all the way to the sale to bid on something I'm never going to get anyway.
Click to expand...

If you meet the floor price and have the highest bid, you will own the animal. If someone calls ahead of time and asks the floor price I have on a bull in a consignment sale, I'll be glad to tell them. I have done it before.

So, when buying a bull private treaty, do you ask the seller what the price is before you show up to look at bulls?
 
Elder Statesman":3a0l56i9 said:
So, when buying a bull private treaty, do you ask the seller what the price is before you show up to look at bulls?
Click to expand...

When buying anything I ask the price ahead of time. There's no reason to waste my time or the seller's time if something simply doesn't fit my business plan. I know roughly what I should pay for stuff and what I can't pay no matter how much I like it.
 
If there is a floor price to where a meat market or other buyer guarantees they will buy all animals for a set price, I don't mind that floor price. If the floor is just a gouge, I don't want to be gouged.

I don't mind a seller using a P.O. or calling "no sale" either, if it is immediate.
 

Similar threads

3waycross
Minimum SC measurement to pass BSE
Replies
6
Views
977
3waycross
3waycross

Latest posts

Top