When I first started my business, I prospected for business by cold calling.
(Cold calling means reaching out to someone who doesn’t know you and to whom you have no connection.)
At the time I was living in Miami, FL, so I Googled lists of area private schools and nonprofits. I’d visit each group’s Website, researching it to see if they held an auction. If they did, I’d call them to tell them about my services.
I share this because if you’ve posted anything about your benefit auction on your website, don’t be surprised when “donations” start appearing in your email inbox! Photography services, fabulous homes in choice spots, and other unique options might suddenly land at your feet.
Vendors are able to provide impressive items in every conceivable niche – art, jewelry, memorabilia, vacations, experiences, etc. Each vendor makes it easy for you to fill your auction with items seemingly perfect for your crowd.
Two of my clients were recently contacted by email by different individuals. Each individual offered a home in a choice location — one in the USA; the other abroad. These unsolicited auction items got my clients nervous and excited.
“Do you know anything about this,” they asked me, “It seems like a really good deal!”
My clients understand the concept of consignment companies, but these emails weren’t from a consignor – or at least the personal stories shared in the email didn’t sound like consignors.
Moreover, these individuals only had one item to consign – a house! What kind of a consignor only has one item to sell?!
(Don’t know what consignment is? Read this oldy-but-goody post about getting items on my blog.)
Whether you’re being offered one item or a book filled with items, if you’re paying for it, it’s consignment. Consignment might be a fit for you; it just depends on your auction.
My mantra has always been to think about your benefit auction as a business. When you embrace this idea, you’ll start to appreciate how many other companies you can partner with. This might mean “partnering” with a consignor, or opting not to. But before you decide to work with anyone, you’ll want to ask questions!
Here are points to consider and questions to pose when one of these emails is sent to you.
- First, realize most aren’t “100% donations.” If I owned a few homes and wanted to earn money from one of them, I might also opt to “donate” it (i.e. rent it at a discount) to nonprofits. Or the rent might be free, but I’d charge fees for other elements. I’d make some money and perhaps get a tax discount. It’s a legitimate way to make money, but it’s not a 100% donation to you.
- Ask your auctioneer if he’s familiar with the property and can share insight. One home I’ve sold several times comes with numerous additional charges for incidentals. The home’s owner always fails to outline these to my clients. I explain them, so my client can decide whether to use it and how to advertise it. In another case, two vendors with a similar offering have substantially different terms. Depending on the size of my client’s auction, I direct them towards one vendor or the other.
- Understand the payment. What’s the total cost? For instance, are there charges for cleaning fees or activity surcharges? (Do you want your buyer to pay those, or do you want to cover them?) When is payment expected? What terms are in place if the property becomes unavailable or can’t be used? (If someone is offering their home for sale to many nonprofits, it’s conceivable that the home becomes oversold and your buyer can’t easily “use” their purchase.)
- Planes, trains, and automobiles. How will your buyer travel to the home? What airports / trains / private cars are used to arrive at the destination? This information will help you market the home if you opt to use it, and details like this are rarely included in the marketing literature.
- Current references. Ask for the contact information for the last three to five nonprofits that have stayed on the property. Confirm when they visited and if the place was as advertised. Was the home well-kept or needing attention? Did the winning bidder receive all that was promised?
- Take high sales with a grain of salt. Home owners love to tempt you with high sale prices. “It sold for over $5500 at Auction ABC,” they’ll write. Frankly, it would be more useful to know what the home sells for most of the time; the median sale. Your auction isn’t Auction ABC. You’ve got different buyers, a different combination of items, and a different flow — so get those stars out of your eyes.
My clients are currently following up with these “consignor-donors” right now. Maybe we’ll use those homes in their auction, or maybe not. It’s all about the due diligence!
Got other ideas? Please share your thoughts!