Auction terms
Hammer price
The price at which the auctioneer knocks a lot down to the successful bidder. It is not the total the buyer pays — buyer’s premium and, where applicable, VAT are added on top.
Buyer’s premium
A percentage of the hammer price paid by the buyer to the auctioneer in addition to the hammer price. It is disclosed in the conditions of sale and on the sale page. When budgeting, work out the total payable rather than bidding to your limit on the hammer alone.
Reserve
The confidential minimum price below which a lot will not be sold. Not published, and not the same as the guide or estimate.
Estimate
The range in which the auctioneer expects a lot to sell, based on comparable results. A guide for bidders, not a guarantee, and not the reserve.
Lot
The unit in which an item or group of items is offered. How assets are grouped into lots materially affects what they realise.
Provenance
The documented history of an item — where it came from and who owned it. Can add substantial value, particularly on furniture and collectables.
As seen
Sold in its current condition, with no warranty as to working order. The normal basis for used commercial equipment, and the reason viewing matters.
Webcast auction
A live auction called by an auctioneer and broadcast in real time, so online bidders compete simultaneously with those in the room.
Timed online auction
An auction with no auctioneer, where lots open and close on a clock over a set period.
Underbidder
The bidder who made the last bid before the winning one. Where a lot fails to reach its reserve, the underbidder is often the first approach after the sale.
Asset terms
FF&E
Furniture, fixtures and equipment. The durable contents of a commercial building rather than the building itself — furniture, lighting, kitchen and bar equipment, back-of-house plant.
OS&E
Operating supplies and equipment. The consumable and replaceable items a venue needs to trade — crockery, glassware, cutlery, linen, uniforms, service equipment.
Chattels
Movable items of property, as distinct from land and buildings. A chattel valuation values these movable assets.
Retention of title
A contractual term letting a supplier retain ownership of goods until they are paid for. Relevant in insolvency, where such goods may not belong to the insolvent company and cannot be sold.
Landlord’s fixtures
Items belonging to the landlord rather than the tenant, which the tenant therefore cannot sell. Identifying these correctly before cataloguing avoids selling something that was never yours to sell.
Valuation bases
Going-concern value
Value assuming the business continues trading and assets remain in use where they are. Normally the highest basis.
In-situ value
Value assuming assets stay in place and installed, but without assuming the business continues.
Ex-situ value
Value assuming assets are removed from site and sold elsewhere, with dismantling, transport and reinstallation costs deducted.
Forced-sale value
Value assuming a compressed timetable that restricts marketing and the buyer pool. Normally the lowest basis, and the one most often required in insolvency.
Chattel valuation
A valuation of movable assets on a stated basis at a stated date, prepared to be relied on by a third party such as an insurer, lender or officeholder.