Some six months after Sotheby's, Christie's and Phillips raised their respective buyers' premiums to 15 per cent for the first pounds 30,000-bid on most items, Bonhams confirmed that it will keep its rate down to 10 per cent. Paul Whitfield, deputy chairman of Bonhams, suggested that this had been a contributory factor in the 20 per cent increase in business so far this year.
But he added that for bidding above pounds 30,000, when the premium charged by rivals returns to 10 per cent from 15 per cent, 'our advantage . . . (at present) begins to diminish. In order to maintain our competitive advantage, we have decided that . . . vendors entering lots which individually sell for more than pounds 30,000 will only be charged 5 per cent commission'.
Explaining the decision to undercut the firm's rivals, Christopher Elwes, managing director of Bonhams, said: 'Total deductions at Sotheby's, Christie's and Phillips are now markedly higher than at Bonhams. In the case of a pounds 40,000 lot, the net difference in deductions would be pounds 3,500, a thumping 58 per cent more than Bonhams'.
George Levy, a leading furniture dealer, said: 'Bonhams are to be congratulated. Clearly it's a price war. Vendors are likely to sell their artefacts under pounds 30,000 through them, realising they'll be 10 per cent better off.'
Bonhams said that its 'more favourable' rates had already convinced several regular clients of the other auction-houses to consign items to Bonhams instead. Such clients include the seller of an important Samuel Palmer drawing, which will be auctioned this July for an estimated pounds 20,000 to pounds 30,000.
Jeremy Delmar-Morgan, of Teather & Greenwood, stockbrokers specialising in art, said: 'It's a brilliant tactical move.' And Mr Whitfield said that Bonhams would be prepared to negotiate levels with vendors: 'We are not saying that 5 per cent is rock bottom.'
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