Online Auction Terminology Guide
Online auctions are a fantastic resource for business liquidation. But, if you're new to the online auction world, the language can be confusing. This guide will help you understand some of the most common terms used in online auctions so that you can bid with confidence.
A bid submitted by a potential buyer not present at the online auction.
After Sale Offers
Bids placed after the online auction is over for items that did not sell.
A notification set by the buyer that will automatically bid on an item up to their specified limit if someone outbids them.
An estimate of fair market/insurance value, typically done by a professional appraiser.
The condition of the item sold without a warranty or guarantee from the seller.
The physical location where an online auction is taking place.
Auction Listing Agreement
The contract between the seller and the online auction company outlines the terms and conditions of the sale.
The person in charge of running the online auction.
A feature that allows the buyer to set a maximum bid and have the system automatically bid on their behalf up to that amount if someone outbids them.
Bank Letter of Credit
A letter from a bank stating that the buyer has the funds available to purchase the item.
An offer made by a potential buyer to the seller.
Also known as a "call for bids," this is when the auctioneer reopens bidding on an item that has had its final bid called.
A record of all bids placed on an item.
The minimum amount by which a bid can increase.
A form of fraud in which two or more people agree to refrain from bidding against each other to drive up the price of an item.
The practice of waiting until the last few seconds to place a bid to avoid giving other potential buyers a chance to respond.
A record of the items a buyer has bid on and their corresponding bids.
A legally binding contract created by bidding at an online auction.
Preventing a bidder from bidding in an online auction.
An online auction in which items are grouped and closed as a block.
When an auctioneer declares an item "bought in," it means that the item did not reach the reserve price and will not sell.
An additional fee added to the final purchase price of an item, typically a percentage of the last bid.
The percentage of items in an auction that are "bought-in" or do not reach the reserve price.
The price at which the seller is willing to sell the item outside of the auction.
Buyer Absolute Bid
The highest amount a buyer is willing to pay for an item.
Certified Auctioneers Institute
A list or guide of the items available at an online auction.
The process of describing and photographing items for an auction.
Certificate of Authenticity (COA)
A document that guarantees the legitimacy of an item, typically used for art or collectibles.
A bid placed by the auctioneer to increase an item's price. This bid is legal but generally frowned upon as it can manipulate the auction's outcome.
The rhythmical speech used by auctioneers to keep the bidding going.
The person responsible for recording bids and maintaining order during an auction.
The final stage of an auction in which the highest bidder is declared the winner.
The fee charged by the auctioneer for their services.
An online auction in which all items close simultaneously.
The physical or working condition of an item.
A document describing the condition of an item, typically used for high-value or delicate items.
An auction in which the sale is contingent on certain conditions being met, such as financing.
The person or company who consigns items to sell at auction.
The person or company entrusts items to a consignee to sell at auction.
A professional responsible for the care and management of a collection of items, typically in a museum or gallery.
The highest bid currently on an item.
An auction that takes place over one day.
A sum of money paid by the buyer to the auctioneer as a show of good faith before the auction.
The research done by a buyer in advance of an auction to assess the value and condition of the items offered for sale.
An auction in which the items close at set times throughout the auction.
A third-party service holds funds in escrow until the transaction is complete.
An auction of items from an estate, typically held after the owner's death.
An appraisal or valuation of an item, typically given by a professional.
A specialized knowledge in a particular area, such as art or antiques.
An auction in which the closing time is extended on an item if someone places a bid within a set period before the scheduled closing time.
Fair Market Value
The price that a willing buyer and seller would agree on for an item.
An announcement made by the auctioneer that the item is about to be sold.
The process of assessing the condition and quality of an item.
A promise by the auctioneer that an item will sell for a specific price.
The price at which an item is sold, announced by the auctioneer dropping their gavel.
An Auctioneer is liable to a seller for losses related to the auctioneer’s negligence, or to a buyer for fraud and failure to deliver property.
A claim or legal right to hold a property or possession belonging to someone else until they pay their debt.
A group of items offered for sale as a single unit.
A number assigned to each lot in an online auction catalog.
Identification marks on an item, such as a maker's mark or signatures.
The highest amount a buyer is willing to pay for an item.
National Auctioneers Association
The professional trade association for auctioneers in the United States.
Next Allowable Bid
The minimum amount required to remain the high bidder.
An auction in which there is no minimum bid or price set for an item.
An auction occurring online, typically through an auction app or website.
The first bid made on an item.
To be outbid is to have been beaten by another bidder's higher offer.
A paddle is a numbered paddle used to signal bids during an auction.
An announcement made by the auctioneer that an item will not sell.
Requirements related to when a buyer must pay for items won during an auction. Most auction companies require payment after a successful bid.
An estimate of an item's selling price before the online auction.
A period before an auction during which potential buyers can inspect the items for sale.
A history or record of ownership of an item.
The minimum price for which the seller is willing to sell an item.
The person who handles the shipping of sold auction items.
An auction in which bids are submitted in sealed envelopes and opened after the deadline.
The market for selling items after they have been initially sold, such as at an auction.
The percentage of items sold during an auction.
An auction in which items close one after the other, usually with a set time interval between each closing.
Single Lot Auction
An auction with only one item offered for sale.
The price at which the auction begins.
Terms and Conditions
The rules and guidelines of an online auction.
Two or more bids occur simultaneously for the same price.
An auction in which items are offered for sale for a set period, after which the highest bidder wins the item.
Types of Payments Accepted
The auction company may accept cash, credit cards, debit cards, cashier’s checks, or personal checks.
The person who makes the second highest bid on an item.
A professional appraisal of an item's worth.
White Glove Sale
An auction where every item sells, regardless of the price.
The removal of an item from an auction before it sells.
Going Once, Twice, and Sold to the Highest Bidder
Auction terminology can be confusing, but with this guide, you should now have a basic understanding of the most important terms. Remember that auction terms may vary depending on where you live, so it is always best to consult an auctioneer or other professional if you have specific questions. Contact Auction Masters today to learn more about common auction terminology.