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February 20 Minimum Bids for Silent ItemsMinimum BidsFrom time to time, clients ask "What percentages do you use for minimum bids on silent items?"
When we were first involved in fundraising auctions, almost every item started around 30-40% of value. The goal was to provide a minimum bid (and raise) that fostered spirited bidding, and could still leave someone feeling like they got a deal. We've never been able to apply a "one size fits all" formula, and as time has gone on, we've broadened that range considerably. (And we're trying to change the silent auction from feeling like an elegant garage sale.)
Restaurant gift certificates pretty much always go for full value, or higher. Bidders know that they will be able to enjoy the full value of the certificate. As a result, they are generous when they bid on these. So we now set the minimum bid for restaurant gift certificates at 50% of value.
Unique "guy" gifts tend to do well at our events. For instance, a donor put together a package for "grilling" comprised of a non-stick grill tray, cookbook & electronic wireless temperature gauge. It had all the perfect appeal for men... it involved danger (fire) and electronic gadgetry! ;-) So we put the minimum up around 50% for items such as these.
On the other hand, "tchotzkies" for the house, such as a ceramic figurine, can be a tough sell, unless they have special emotional value, or are originals. Most people already have too much "stuff" and may hesitate before adding to the collection. So, at the risk of offending a donor, these items might have a minimum bid of only 20-25% of quoted value. Note--it's even more embarassing if an item doesn't receive any bids at all!
We still use the 30-40% range as a starting point. The majority of our tangible items end up with a starting value in this range. Nicer and more unique items start around 40%; more ordinary items, that could be readily found on sale in town will be closer to 30% starting bid.
What about items where the donor does not provide a value, or the value provided seems peculiar? The internet is a great resource. Visit your favorite online shopping or auction sites to find similar items; this will give you a good idea of the market value for the item. Once you've established this, then you can begin to set minimum bids & raises.
Handmade, one-of-a-kind and "personal gifts" are the most challenging items for which to establish bid sheet values. Some will go sky-high--such as child's chair, with colorful painted "hand-prints" of the kindergarden class. Others will have a more limited appeal, such as a cross-stitched throw pillow in a teal & peach floral design.
Ask your team for guidance...and hope for the best on these!
What about used items? They can be every team's nightmare--do your best in pre-event publications to discourage used goods. The donors seem to mean well, but dowdy items will make the entire silent auction look tired, and reduce bids overall. We've received a used fax machine that required special paper, lamp with dented lampshade, aquarium with cracked glass on one wall, etc. Except for antiques and artwork, it may be necessary to ask the donor if their gift would be better received at a local thrift shop. This is very difficult. If your organization feels they must accept these items for the auction, put them in a "Bargain Basement" section, and set very minimal starting bids on these, or even "make an offer" as part of the full description. It's no fun to have unsold "junk" that you have to cart away after the event.
In summary, setting minimum bids is not an exact science. Balancing revenue and getting items to "move" is a retailing art, and you'll need to consider minimums thoughtfully.
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