Ethics at the Top Two Auction Houses Essay Example | Topics and Well Written Essays - 5750 words

Ethics at the Top Two Auction Houses - Essay manakinThe value for money stretches from a few hundred dollars (e.g., wine) to millions in expensive paintings. (CEC 7)The auction sale of private collections may be held either with a reliable motif, under a class of the commodity, or the arts genre or given time period. In 1996, Sothebys sold at auction the estate of Jacqueline Kennedy-Onassis as a collection, while other ordinary dealings were categorized in Old Master Paintings or Jewellery. Sothebys fiercest competitor, Christies also hold such glamorous, multi-million-dollar auction events, as the richest of richest of men kindness such occasions. (CEC 7)Although both auction houses hold regular auctions at their subsidiaries throughout the world (Rome, Geneva, Zurich, Amsterdam, Milan, Melbourne and Hong Kong), high-profile auction events are generally held at their London and New York headquarters. (Ashenfelter & Graddy 3-25)The auction houses, which learn items to be auction ed (on a consignment basis), handle each necessary arrangement for the event, including planning, design and distri exclusivelyion of high-class brochures, advanced publicity as well as viewing opportunities. To facilitate sales, merchandise are sold individually (called lots), even large collections are separated and auctioned as a single item. As seller of the consignors items, the auction house manages all the account procedures bills the buyer, remits the consignor the money after the purchase of the merchandise, minus the commission, taxes and other expenses.The commission is computed within the hammer price, when the item is settled to the lovely bidder. Regarded as sellers commission or vendors commission, a certain percentage is taken from the consignor. The buyers premium, or a percentage from the hammer price is also charged to the buying public at the auctions (CEC 8).A percentage of the hammer price, called the buyers premium, is also charged to people making purchases at auctions. This practice was initially introduced in the main auction live of these two auctions giants, sometime in 1975-only a few weeks from each other. Both firms made several changes on this practice through the years (independently from each other), but eventually both of their practices became similar.Auctioneering is not the only source of income of these two firms as both are engaged in other commercial activities, such as offering loans against the security of works of art. Nonetheless, the main sources of revenues remain the buyers premium and vendors commission. (CEC 8)The turgid exercise of auctioning fine arts produce a discriminating product market place effect other than conventional ventures of selling or buying the items that serves the purpose of assessment value, based on the following (CEC 8). Firstly, clients consider the great importance of consigning their items at auctions due to the high standard of publicity for the merchandise. Likewise, consignors ac hieve the highest possible