Why Hire a Professional Auctioneer for Your Benefit Auction: Benefits of Using a Professional Auctioneer

The auction business has changed greatly over the past several years - new technology, the growth in popularity of mobile bidding and online bidding, and general growth across all sectors of the industry mean that it takes a unique type of auctioneer to perform a successful benefit auction. Consequently, staying relevant when there are so many alternatives for people to explore also becomes a challenge. The competition is fierce to gain the attention and presence necessary. All auctions present various challenges, but none quite like the benefit auction. The benefit auction involves diversifying several methods of generating revenue, entertainment value, theatrics, and, most importantly, handling the fine art of maintaining the right emotional tone with guests so they feel and support the cause.

This has given rise to the Benefit Auction Specialist (BAS). A Benefit Auction Specialist is an auctioneer who does much more than speak quickly and move inventory. The few benefit auction specialists (about 300 in the U.S.) immerse themselves in the field of benefit auctions since the time required to properly prepare an event leaves little room for anything else. Benefit Auction Specialists have positioned themselves in this niche to consult, plan, avoid pitfalls, make the process easier, raise more funds, and hold the most successful fundraiser possible. They take their spare moments to search for and contemplate new methods of revenue enhancement, and then they spend days, weeks, and months planning and preparing for auction events.

What Is a Charity Auction?

A charity auction is an event typically organized and held by nonprofit organizations to raise funds for their operations. The setting can vary, but one of the most common formats is a gala dinner.

While the evening is packed with entertainment for the attendees in the form of dinner and dancing, there is also a charity auction, with the proceeds going directly to the nonprofit- the auction items are always quite attractive to the clientele and are generally donated by sponsors from the community.

Options for Choosing an Auctioneer for Your Benefit Auction

If you're running a benefit auction, it's time to call in an auctioneer. Generally, you have three options:

Option 1: Volunteer Auctioneer

The volunteer auctioneer—your free option—can be anyone from a celebrity to a parent who shows up and takes bids. Volunteer auctioneers are best suited for small events, especially for first-timers, where it is likely that there is a low ceiling on the funds that could be raised in the live auction. While the volunteer auctioneer offers their services for free, the potential for "foregone revenue" exists.

Option 2: Professional Auctioneer

Commercial auctioneers are professional bid takers, but they don't specialize in fundraisers. For example, a commercial auctioneer might be a local real estate auctioneer who also dabbles in the benefit gala market.

The advantage of hiring a commercial auctioneer is that you avoid the risk of a volunteer who might not perform well on stage. However, commercial auctioneers may lack fundraising expertise, such as crafting a fund-a-need presentation.

Option 3: Benefit Auctioneer

Benefit auctioneers work exclusively for fundraisers. They not only secure bids but also consult on procurement, audience development, event planning, storytelling, and other critical components that make your gala successful.

Any nonprofit organization seeking to net more than $60k from their auction should strongly consider hiring a benefit auctioneer. The cost will be a tiny fraction of the proceeds. A good auctioneer reduces the risk of a dud event and increases the likelihood of reaching your event's potential.

A Professional Charity Auctioneer Can Make or Break the Event

If you're planning a successful charity auction, hiring a professional charity auctioneer is essential- many organizations make the mistake of using a local celebrity or a great speaker as their live auctioneer.

These individuals might seem like a good idea for your next event, primarily because they don't charge or charge very little- however, they lack the training and psychological skills to effectively motivate a room full of people to raise their paddles for the benefit of your organization. Consider hiring a team of professional charity auctioneers as an investment, not a cost—one that could significantly enhance the success of your fundraisers.

A great professional charity auctioneer will bring the tools, techniques, and experience necessary for your event, maximizing the fundraising effort to a whole new level.

Why Do I Need to Hire a Professional Auctioneer for My Benefit Auction Event?

Benefit Auctioneers Are Fundraising Specialists

Auctioneers specialize in various trades and industries, from cars to cattle, and similarly, some auctioneers are more suited than others to dealing with charity events.

Auctioneers holding the BAS designation from the National Auctioneers Association are versed in advanced-level techniques to deliver success in benefit auctions. They're not just chanting items at your live auction—they're skilled professionals with extensive experience in event fundraising. Allow them to guide you through the planning and execution of your special event.

For starters, there aren't that many professionally trained benefit auctioneers. While there are thousands of auctioneers specializing in auto, antique, art, estate, livestock, wine, and more, fewer than 300 professionally trained auctioneers specialize in charity and benefit auctions. These auctioneers carry the designation of Benefit Auctioneer Specialist and have received specialized training in fundraising, event coaching, and event planning. They go far beyond just getting up on stage and talking fast!

Even if each of these 300 benefit auctioneers conducted 100 charity auctions a year, that would total 30,000 events—less than one-half of one percent of all the events held annually. Meaning, finding an available benefit auctioneer specialist can be quite challenging.

Benefit Auctioneers Are Consultants

The reality is that you cannot plan for every single issue that arises during your planning process. This is where a benefit auctioneer can make all the difference.

The auctioneers don't just arrive at the venue on the night of the event, chant the auction, and leave. Good ones will offer consultation and advice throughout the process.

Got a question about your auction items? Problems with procurement? Or entertainment perhaps? Ask the benefit auctioneer. They have worked hundreds of events just like yours, so they have a wealth of firsthand experience from which to draw and make suggestions.

Benefit Auctioneers are Crowd Pleasers

Sure, there's a volunteer who is an extroverted and charismatic type and more than game for the role, but that doesn't mean he or she knows how to really keep an audience engaged. Auctioneers know how to fill those pauses with audience-friendly discussions that keep guests entertained between agenda items. And happy guests are more likely to bid. A seasoned benefit auctioneer will even conduct background research about your audience in advance to develop the best strategy for maximizing participation, enjoyment, and spending.

Benefit Auctioneers Raise More Money

Besides the intangible benefit of using professional auctioneers, they literally build their careers on working a room and getting every last dollar from those willing to spend. They know when to be funny and when to be sentimental, when to soft-sell and when to be aggressive. And that's not even limited to live auctions! Professional auctioneers know when and how to direct people to the silent auction tables, how to involve the audience in quick mini-games between agenda items to raise a few extra hundred dollars. These professionals are dedicated to selling your fundraising because they do it for a living, and more importantly, they want you to hire them again in the future!

How to Choose an Auctioneer for Your Next Charity Auction

After all, a professional auctioneer is a partner in fundraising, but you want to ensure you invest in the right talent. Here are some things to consider when selecting the right auctioneer for your charity auction:

Commission vs. Fee-Based

When choosing a professional auctioneer, you will likely need to work within your budget. Generally, there are three different structures for how auctioneers charge:

Flat Fee: You and the auctioneer agree on a set payment, and no matter how much money is raised, you only pay that fee. This makes it easy to budget for your event because you know in advance how much you will pay for the auctioneer's services.

Commission-Based: Some auctioneers charge a straight commission (e.g., 10%), meaning they get paid based on the amount of money raised at the microphone during the event (typically the live auction, paddle raiser, and any auction games). As your fundraising efforts increase, so does the compensation for the auctioneer. Most auctioneers will include a cap so that their commission is not unlimited.

Base Fee Plus Discount on Commission: Some auctioneers work based on a base fee plus a small discount on the full commission. Typically, the commission would have a cap.

Industry Specialization: Make Sure You Hire a Benefit Auctioneer

A typical auction for cattle, cars, or storage is unlike your gala in one very important manner: normal auctions are liquidation events, while your gala is a fundraising event. This distinction is crucial because it affects how the auctioneer should treat both the items and the guests. 

The attendees at most auction events are there specifically for the auction and those items, making them full-time auction attendees. In contrast, the guests at your gala are not there specifically for the auction. They attend because they love your organization, a friend invited them, or their company bought a table. They are socializing, drinking, and having a good time. The auctioneer must consider your audience's state of mind and auction experience while conducting the bidding.

Vibe

You seek an auctioneer who exudes passion, knowledge, and enthusiasm for your organization and mission.

Fast or Slow Talker

Consider your audience when determining your auctioneer's voice speed. Some audiences may like the classic fast-talking auctioneer. The rapid-fire auction rhythm is dynamic and attention-grabbing, and some really like it. For some groups, the rapid-fire approach is off-putting and confusing. They prefer an auctioneer who speaks slower and in plain English. On this point, there is no definitive answer. Ultimately, you have to determine what works best to engage your audience.

Bonus Offers

Some auctioneers will donate items that can be auctioned off during your event, so it's worth asking about because the money raised on those donated items will cover part or all of the auctioneer's fee.

Testimonials

A skilled auctioneer can provide abundant success stories and testimonials from past benefit auctions. Check references and have confidence that the person you're hiring can handle your event professionally.

Hiring a Benefit Auctioneer

Now, how does one go about hiring a benefit auctioneer?

Step 1: Create the Candidate List

The first thing you need to do is establish a list of eligible candidates. Two places to start are:

• The BAS- which stands for Benefit Auction Specialist and represents an auctioneer who has completed the course for Benefit Auction Fundraising, offered by the National Auctioneers Association.
• Another place to find candidates is in the TravelPledge Directory of Certified Professionals, with each committing to run their business transparently and coach key strategies to maximize donations.

Next, narrow your list to auctioneers who work in your region and are available on the date of your event. While most benefit auctioneers work regionally, some top professionals travel cross-country to present at big events.

Step 2: Conduct Interviews

Interview each of the qualified auctioneers, check credentials, and follow references. Most reputable benefit auctioneers can share a highlight video that will further support your evaluation of their skills.

When interviewing an auctioneer, you need to:

• Understand the auctioneer's style. Can they serve as effective brand ambassadors for your organization?
• Ensure the benefit auctioneer has performed many such fundraising auctions as you are planning.
• Ask for statistics on how successful they are at performing the fund-a-need.
• Describe a challenging situation your organization has faced in regards to a past event and ask the auctioneer how he or she would have approached it
• Know what other services an auctioneer will provide besides taking bids.
• Ask how the auctioneer is compensated. You will find a wide combination of flat fees, commissions, bonuses, and service premiums. The best structure will depend on your organizational preferences and the event size.

Step 3: Cost-Benefit Analysis

The final step in hiring a benefit auctioneer is to analyze which auctioneer will get you the best return on your investment. The structures for compensation of auctioneers also vary widely, with options including a flat fee, commission, bonuses, or service premiums.

The better structure will depend on your organizational preferences and the size of your event. If your auctioneer operates on a commission basis, it's advisable to request a cap on their total compensation. Measure what you expect to yield in benefits from the candidates you have interviewed against the information on costs and decide which best fits!

Are Nonprofits Asking All the Right Questions?

Experience is the most essential part of all you must consider if you will go for a top-notch charity auctioneer. Make sure you ask the following questions and do your homework:

Can you give me a list of references?

Hiring a benefit auctioneer should be treated like hiring someone to work for your company. You want to go through an interview process. Specifically, you will want to ask for a list of the last 10 auctions they conducted, complete with the name and phone number of the contact person for each event. Then, follow up and determine if the benefit auctioneer met or exceeded their goals.

Getting good reviews from the clients and referring to benefit auctions conducted in the last four weeks indicates they are an active and successful benefit auctioneer. However, if their auctions are sporadically spaced and only held a handful of times each month, it should raise a big red flag.

What similar organizations have you worked for?

The organizations with which an auctioneer has previously worked would give a very good idea of the kind of organizations they have experience working with and, hence, how similar or dissimilar they would be to your charity and its goals.

What does your average auction earn? How does that relate to what the event earned before that auctioneer began working for the organization?

Be prepared to have a reasonable expectation of the average amount you would like in donations from each donor, and find out if the auctioneer has any experience with these types of numbers.

Are you strictly a nonprofit market benefit auctioneer?

This is a vendor area where it's critical to have an auctioneer who knows nonprofits. Even though for-profit and nonprofit auctioneers share many similarities, running a live charity event is very different from managing a for-profit event, requiring a specialist.

What type of consulting do you provide, and is it covered in the fee?

Knowing the charges and services in advance will help you understand the role of your auctioneer before and during the event. Make sure you do your homework to get the best value and maximize the profit from your fundraising event with a professional charity auctioneer!

Maximizing Your Charity Auction: Integrating Online Auctions with Your Event

Charity auctions conducted online can be a bit tricky. You will need to decide if your online auction is a part of another fundraising activity or a standalone event.

Mixed Auction

Start all auction items online. When an item reaches the "buy-it-now" price, it is considered sold. Everything that has not reached the "buy-it-now" price gets put into a physical silent auction at your event. Use the highest online bids as the starting bids for the physical auction. Note: This method is complicated. It requires a lot of work for the nonprofit, but it can also yield higher bids.

Online Auction

Take your auction completely online. Encourage all donors to view the items in the auction and then bid from the event website. Open a week before the event, close at midnight the following Saturday.

Split Auction Into Online and Live

Split the auction into two parts; half online, half at the event. Again, you would open the online auction a week before the event and close it a week after. Keep your online auction open for a minimum of two weeks if your auction is an independent process from your event. Create pomp and circumstance around the opening and closing of the online auction- emails, social media, tweets, and announcements.

Reach out to your donors in every way imaginable to ensure they know the auction is happening. As you might expect, 80% of the bidding is done in the final days or even hours of the campaign. Step up your outreach efforts to capitalize on last-minute bids. Most online auction software sends automatic reminders when a donor has been outbid or the time is running out on an item. This is an excellent feature, but do not depend solely on the automated messages.

What About Emcees?

Some events have an emcee as well as an auctioneer. The emcee will introduce speakers and also read each live auction item's title, catalog number, and brief description. After the emcee introduces the item, the auctioneer will start taking bids.

Ideally, the emcee should be a volunteer within your organization or a local celebrity. Just remember that you want someone with stage presence who is liked by your supporters. Whether or not you have an emcee depends on the talent you are working with and the skills the auctioneer possesses.

Frequently Asked Questions

Do people other than donors get a tax deduction for donated auction items and sponsorship?

All monetary and property donations are tax-deductible. Be certain to mail out a contribution acknowledgment letter to your donors.

That letter will include your organization's name, a description of the item, and a statement that nothing of value was given in exchange for the donation (or estimate the value of what was given). The donor can estimate the amount of their donated item so that it does not have to be furnished.

Contributions in the form of services provided or using property for vacation rental time are considered non-deductible as opposed to cash donations and donated property.

Are tickets and auction purchases eligible for tax deductions for attendees?

Tickets and auction purchases are generally deductible as a charitable donation to the extent that the amount paid exceeds the fair market value of the item purchased.

You would just need to provide the fair market value of the ticket on your ticketing page and catalog, as well as the fair market value of auction items on bid sheets.

Should we be collecting sales tax on our tickets and auction items?

Generally, yes. It would be best to charge whatever sales tax applies to ticket and auction item sales. Just because your organization is free from paying sales tax does not mean it's free from collecting it.

Is auction income taxable?

Sometimes, your auction proceeds are considered Unrelated Business Income (UBI) because they were generated in a way not substantially related to your tax-exempt purposes.

Many conditions depend on whether you owe this tax, such as the frequency you throw such a fundraiser. Your accountant will need to be consulted for your particular situation.

What are the record-keeping requirements for nonprofits?

Keep records of all contributions and purchases for at least five years in case of an audit or a later look-up.

Choosing the Right Auctioneer: Enhancing Transparency with Paybee

Hiring a great auctioneer for your charity fundraiser isn't easy—it requires research and due diligence. Start by determining if they have any relevant licensing requirements and fees, and once again, ensure they understand the purposes and goals of your event. The use of tools like Paybee truly enhances transparency in this regard. Take your time; potential candidates should be checked for their experiences, reputation, success rates in recent years, and certification. By doing these things right, your charity fundraiser is sure to be a success and will always be on the minds of your guests- leaving a lasting impression.