Consignment auction items are an option for nonprofit organizations that want to engage their attendees and inspire some fierce bidding. After all, at any given live or online auction, the amount of money you raise is directly related to items that go on the block.
While gift cards for the local mall and baskets of miscellaneous donations are all good and well, it's big ticket items that really rake in the donor dollars online and in person. But, as every nonprofit fundraising professional will tell you, big visions aren't enough. If you want to attract those big donors, you need to give them something to get excited about.
But what about the capital? Where do nonprofit organizations find the money to put things like safari adventures and yachting excursions up for bid? The answer lies in consignment auction items.
Here's a look at what consignment auction items are, and how nonprofits can use it to boost their auction's success.
Consignment auction items are big-ticket items that are procured by nonprofit organizations by means of partnerships with outside companies that specialize in items like trip packages, sports memorabilia, art, etc.
The nonprofit and the company agree on a set reserve price that has to be met before the item can be awarded. The item goes on the block without any risk to the nonprofit since they only pay the consignment rate if the item is sold to a bidder.
For instance, a trip to Yellowstone National Park may come with a consignment price of $2,500, and sell for $6,000 at auction. In this case, the nonprofit or charity in question will pay the consignment company $2,500 and profit $3,500 in charitable donation dollars.
This is a great option for charities since it can be risky to procure auction items like these out of pocket without the assurance that it will fetch a good price at auction.
However, the downside is that a bid may only go a little over the set reserve price (e.g. $3,000). In cases where this happens, the charity will still have to pay the $2,500 fee and only walk away with a paltry $500 to show for their troubles.
So, how do you ensure that you make the most out of your procured auction items? Well, here are some tips to help you raise more funds with consignment auction items.
When you have your consignment auction items in place early on, you can use them to your advantage. Create an advertising campaign so that you can drum up interest for your charity auction. With the big-ticket items secured, it's far easier to reach the right demographic as you know what you're 'selling' them on.
By advertising your unique items ahead of time, you are in a much better position to entice people to attend. You can generate some excitement using channels like social media, mailing lists, etc. This way, you can reel in the big fish who are likely to raise your starting prices when they get involved on auction day.
Knowing what type of donor your nonprofit or charity normally attracts can go a long way in securing the right kind of consignment auction items.
Data, such as the average bidding amount at previous auctions, can be very helpful. For example, if you know that the average spend was around $1,000 per person at your charitable auctions in the past, it doesn’t make sense to put a $5,000 shark-cage diving outing on the block!
Also, keep your audience’s interests in mind. People supporting a sports-based charity are far more likely to be interested in a meet-and-greet with an athlete than they would be in a private guided tour of an art museum, for instance.
FUN FACT! It pays to know your audience and what gets them excited to spend. It might not actually be the flashiest thing out there… For instance, an 1856 magenta one-cent stamp from British Guiana fetched $9.5 million at auction in 2014!
So, make sure you know your audience and try to procure items that you know they will want.
There are different kinds of consignment agencies out here. If you want your charity to get the best items while enjoying a great bidding experience, you need to find a reputable company. Look out for businesses that have been operating for at least a few years. Take a look at online reviews and get some references if you can.
It's also important to ensure that consignment can occur on a no-risk basis. This means that if you don't fetch the reserve price at auction, there will be no obligation to purchase the item regardless. Take a good look at the variety of items and experiences on offer and be sure that you understand the fine print regarding availability, restrictions, etc.
When someone bids a big amount on a charity auction item, you want the fulfillment process to go very smoothly. For instance, if they bid on a luxury holiday, it should be simple for them to secure a date and get everything in place to enjoy the experience they’ve paid for.
As such, it’s important to check with the consignment agency beforehand to ensure that you know about any issues or hurdles that may arise.
Don't fill your entire auction roster with high-priced consignment items. Rather, practice moderation. Offer one or two of these show-stopper items and keep the other items at a more moderate price point.
This way, you won't estrange your less splashy bidders and keep your charity's loyal supporters in the fold.
Consignment auction items are a great way for nonprofit organizations to facilitate larger donations without having to put up large amounts of capital. However, the process needs to be monitored closely to ensure that the nonprofit enjoys the benefits from these transactions.
Always work with reputable consignment agencies and know your audience to get the best results!