A busy auction room appears to be a barometer and suggests the level of interest from the trade
Observable changes in the attendance and live bidding numbers at London auctions indicate a behavioural shift rather than a decline, says Diggory Hadoke.
As a regular at the auctions, I have felt a shift in recent months, perhaps the past two years. I had the distinct impression that the sales were beginning to lose some of their old buzz. Discussions with colleagues and a look at some figures brought some interesting trends to light.
Holt’s sold 506 lots in its Hammersmith saleroom on 17 September. I did not make the Tuesday viewing but was there for most of Wednesday and all of Thursday. One cannot help but reflect on the reduction in momentum that seems to have set in since the heady days of five or six years ago, when the saleroom overflowed and punters complained that they needed more space. On Thursday, the room was a quarter full at best.
What is choking the flow of guns and attendees, one wonders? Auctions thrive on energy and the energy is ebbing in a depressing but observable way. When the room is full, conversation flows, people influence one another, they become covetous of the items that catch their eye, one encourages another, they bid, they win, they lose, they emote. This can only happen in a full auction room. Internet bidding surely doesn’t have the same magic as does the live, jostling throng. I don’t know, I’m no magician – all I do know is what is observable and that’s a downturn in footfall.
To thrive, auctions need new meat, fresh to market. Holt’s have done a wonderful job in the last decade of uncovering lost gems from around the world. Their network branches out across the globe; representatives finding unwanted guns and rifles in Africa, Europe and Asia. There must be a finite number and perhaps we are seeing the beginning of the end of this quest to unearth the unloved and forgotten guns of Empire. This makes the auctioneer a victim of his own success. Once you have sold all the guns on the market, what do you do next?
With this thought in mind, I had a look at Holt’s last three sales to see what effect was evident in the figures. My initial concern at the apparently low numbers of sold lots in September 2015, being only 506 lots auctioned and sold in the room on the day was complicated by the total overall sales recorded in the previous three sales. Clearly, my initial figure did not include the Sealed Bids section of the sale, nor the after sale fixed price Sale of Unsold Lots.
Auctions remain the place to move the odd bit of kit that nobody quite knows how to place or price
In December 2014, Holts offered a total of 3,006 lots in all sales combined an, once all the various elements involved in selling them had been completed, the sales figures show a total number of lots sold as 2106, or, if you prefer, a total sales percentage of 70.06 per cent. That seems pretty good on balance. When you take a look at the money involved, that produces a total sales value of cash incoming as £1,535,043. From this, one can work out with a fair degree of accuracy that Holt’s are taking an average of 25 per cent from the buyer and 10 per cent from the seller of each lot. This will provide an income from the December sale of £383,750 from buyer’s commission and £53,500 from seller’s commission; a total of £537,250. These figures are rough, admittedly, but give a decent indication of the health of the auctions in Hammersmith. Looking at earlier sales, March 2015 sold 62 per cent for a total of £1,302,220 and June 2015 netted 60.76 per cent and £1,331,012.
Holt’s averages around 65 per cent sales in each auction cycle and puts about half a million pounds in the bank account every quarter, once all the VAT has been paid and the vendors recompensed. This is pretty much what Holt’s have been achieving for the last six or seven years. All this head scratching leaves me with a set of figures that are counter intuitive, based on my observations of the action in and around the sales room. What gives?
Talking to friends in the trade, I’m aware that increasing numbers of them are passing on the auctions as sources of guns to sell. Some are not even making the trip to the viewing any more. I have noted a slow down in the movement of English guns and a weakening in the prices realised for all but the very best classic kit in superb original condition, or of special historic interest. A lot of dealers have indicated a surfeit of stock of what we would consider ‘ordinary’ English guns in the mid-price range. That being the case, there is little point in stocking up at auction, where a 40 per cent chunk of profit has already been taken out of the deal.
However, the figures show that people are still buying. Who are they? And where are they? It would appear that a large percentage is private collectors shopping online. The internet bidding system is much better than it was in its early days and the online bidding and telephone bidding options offered now seem to be preferable to many buyers. It preserves anonymity and saves taking a whole day to sit in a room and bid on one or two lots.
The Tuesday viewing has become something of a social event as well as a chance to look at the guns on offer
Perhaps this is the future – American style auctions, with remote private punters bidding retail prices for guns they have seen only in photographs, from the comfort of their work stations. Whatever the eventuality, Holt’s seems capable of moving with the times and altering practices to meet market trends. The buyer profile and the activity in the viewing room have changed over the last decade but Holt’s sales figures have remained remarkably stable over that period.
Not forgetting the other auction activity taking place in London during the build-up to Christmas; Gavin Gardiner is running around the country with his usual vigour, offering free valuations to potential vendors at various locations. He confirmed these dates with me just before Gun Trade News December went to press:
- Friday 9 October – Tiverton, Devon
- Wednesday 14 October – Yorkshire Gun Room, Harrogate
- Tuesday 20 October – Sotheby’s, Edinburgh
- Wednesday 21 October – Glasgow
- Friday 23 October – Sotheby’s, London
- Monday 26 October – Pulborough, West Sussex
The observations I made regarding Holt’s hold true for Gavin’s sales as well: relatively modest attendance in the room on sales day but plenty of telephone activity. The best kit there is also attracting strong bidding, while the weaker stuff often remains unsold. Gavin’s next sale is on 9 December, with viewing in Bond Street preceding it by a couple of days.
Bonhams will be rivaling Gavin for numbers in December, with a similar sized sale of around 200 lots.
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