Traditionally, auctions are associated exclusively with the artwork of old masters. With the expansion into other luxury collectors items such as wine it’s worth knowing a few things about how wine auctions operate before you take part.
A household name is Sotheby’s on New Bond Street that sets standards for others to follow a similar format. As a matter of fact, you don’t even need to be present to bid and there’s always an auction around the corner.
Who should collect wine?
Lovers of wine and spirits are diverse – 90% of those who collect and sell wine at auctions are individuals, who have collected with passion over the years.
Why sell? It is better to consign bottles to auctions, rather than let them perish and oxidate. Auction is a good way to make a profit that can be reinvested in a new winery.
Here’s what you should know before you attend:
1. Know What You Want
Determine your objectives. Are you filling in gaps in a pre-existing collection or are you looking to increase your cellar inventory? Do you want to only invest? What regions do you want to concentrate on? This is a saturated world so have an idea of what you’d like to achieve by attending.
2. Look at the Catalog
Auction houses will offer catalogs in advance and know the difference between the wines. Wines kept in professional or home temperature- and humidity-controlled storage are preferable to collections housed in natural or “passive” cellars, because the latter are often subject to temperature fluctuations, which can affect wines adversely. Pay attention to ullage levels, as the air space between the cork and the liquid is a barometer of a wine’s health.
3. Know the Price Tag
Cross-reference retail prices and estimates. Wine Spectator.com’s Auction Price Database is available as part of an online membership and covers approximately 10,000 cellar-worthy listings, serving as a gauge of the “going rates” at auctions.
4. Don’t Expect a Bargain
Auctions are usually based on previous hammer prices for the identical wine. You can’t expect going into an auction and getting a good deal. Typically, all wine at an auction has a reserve which refers to sum agreed upon between the consignor and the auction house below which the wine cannot be sold and is set somewhere between 80 and 100 percent of the low estimate. Not all wine an auction will be sold. Also, be prepared for the auction to move quickly so make your decisions quickly.
5. Consider a Test Run
Auctions can get emotional, especially because they can move quickly and be fast paced. The best way for a first-time auctiongoer to get the hang of the live-auction process is to attend a sale with no intention of actually bidding. Auctions are typically free to attend with a small fee of presale wine tastings. Observe the bidding floor so there are less surprises for when you’re ready to partake.
How do you bid?
Everyone has their own personal bidding style. Just like with any other auction – some raise their paddle at the outset of a lot and lower it only when they have secured the item or when the bidding exceeds their spending limit. One method that’s found effective for high-priced wines is to enter the fray at the very last minute, when the high bidder thinks he has secured the prize. This tends to throw off the person who thought the lot was going to be his or hers.