ABSOLUTE AUCTION (Auction without Reserve)
- Asset is sold to the high bidder, regardless of price.
- Guaranteed sale, participation enhanced with buyer's excitement.
- Generates maximum response from the entire marketplace.
MINIMUM BID AUCTION
- Bid the advertised minimum or any price above and the asset IS sold.
- Sellers risk is reduced because selling price must be the minimum or above.
- Buyers aware that only at the minimum bid shall a sale occur.
- Interest in the auction may be limited only to those buyers willing to pay at or above the minimum which, therefore must be low enough to induce, and not hinder the auction process.
RESERVE AUCTION (Auction Subject to Confirmation)
- The High Bid is an offer to purchase, but not a confirmed sale.
- Seller reserves the right to accept, reject or counter-offer the highest bid(s) within a specific time frame (usually 48 hours).
- Seller predetermines an acceptable sales price prior to the auction.
- The acceptable price is not published.
Auction Marketing creates an URGENCY whereby, all buyers must respond within the advertised time frame, or risk losing the asset.
BENEFITS to the SELLER
- Intensive Marketing Period which reduces long-term carrying costs, including taxes, maintenance and management costs
- Exposes the asset to a large number of suspects and prospects within a short period of time.
- Seller schedules the time and location as to when the asset will be sold.
- The asset is sold "AS IS & WHERE IS".
- All contingencies are eliminated prior to bidding.
BENEFITS to the BUYER
- Buyer determines the price that they will pay for the asset.
- Buyer knows that there is a level playing field whereby the same Terms & Conditions are being offered to all interested parties.
- All buyers receive comprehensive due diligence/asset information packages.
- Extensive negotiation periods are eliminated.
|
