The Word On Silent Auctions[ldots].

[ldots] and when a live or combination event is a better option.

You've decided to hold an auction--now what? Should it be silent (an opportunity to bid on a variety of items) or live (with an auctioneer)? Should it be a dinner event? Should your auction coincide with your annual meeting? Flow do you allocate revenue generated from the event?

The answers to many questions were discussed on ASAE's Executive Management Section e-mail list. The following excerpts from the exchange can help you plan a lucrative and memorable auction.

Thinking it through

While both types have their benefits, a silent auction may be easier to host than a live one--especially if your organization is new to this. "If you haven't conducted an auction before, get help from someone who has been through the whole process of getting auction items donated and keeping track of them, making displays and bid forms, and cashiering," suggests Teresa Mathis, executive director of the Washington Association of Criminal Defense Lawyers, Seattle. "You're trying to set up a retail operation, but with no set prices, for one evening. If you aren't organized, what should have been a fun event for members can turn into an evening of frustration."

Mathis, whose association has a small auction with about 100 items, suggests planning well in advance, because collecting auction items takes time. "If you're planning on lots of items, you need members who are willing to get the donations," she points out. "We make it clear to board members at the time they get nominated that they will be expected to help. We also provide training at a board meeting on how to solicit auction donations. This only takes 10 or 15 minutes, and it has [greatly] increased board participation."

Mathis also advises researching early in the process your state's laws regarding auctions. In Washington, for example, nonprofit organizations don't have to collect sales tax on auction purchases if they have two or fewer auctions per year. Knowing this kind of information in advance can save time and can prevent headaches down the road.

Achieving results

Kim Howard, former executive director of the Association of Specialists in Gleaning and Restoration, Millersville, Maryland, reports positive outcomes in the past several years of running silent auctions at annual conventions. "We had tremendous success the first year, netting $15,000, which we kept for the association," she says, adding that associate members are usually happy to donate items. The auction is held in the exhibit hall to promote interest in exhibitors' booths.

Howard cautions that without a concerted marketing effort, members can lose interest. She offers the following suggestions for running a rewarding silent auction.

* Promote the event well before and during the convention.

* Remind exhibitors not to bring a donated item unless it can be carried home. Use a picture or an empty product container to show it off [if it's too large to carry home].

* Be firm with bidders; many will want to write down a last-minute bid, which can lead to unwanted haggling.

* Enlist a staff member or volunteer to watch the items to prevent an attendee from walking off with something.

* Consider creating different levels of donation based on retail price (e.g., gold, silver, and copper) so attendees have some idea of the items value.

Laying the options on the table

The American Hotel Foundation, Washington, D.C., also conducts silent auctions in conjunction with major meetings. However, as President Douglas Viehland, GAL, suggests, a combination of silent and live auctions is an effective and profitable approach. "We used a live auction at one of the meetings for a number of years, and dollar for dollar it was more successful than the silent auction," Viehland says. "Due to a change in format of the national meeting, we no longer do an evening event that lends itself to a live auction. The best is a combination--some silent and some live."

Viehland, who says the proceeds from his organization's two silent auctions each year net about $128,000, suggests following these guidelines when planning an auction.

* Find sponsors who will pay anywhere from $5,000 to $10,000 to have their logo on the catalogs, bid sheets, and other promotional materials to boost proceeds.

* Have members donate themselves for purchase by allied members. The American Hotel Foundation (AHF) has a CEO category at their auctions. The hotel executive donor treats the winning bidder to lunch, dinner, or a round of golf.

* Work with other groups. AHF worked with the Hotel Association of New York City to offer "Weekends and Dining Packages in New York," and has made similar arrangements with other associations.

* Start minimum bids at 33 percent of retail value. Viehland suggests establishing 10-percent bid increments, but advises leaving room for flexibility.

* Create "branded" categories. At its last auction, AHF created a category for an allied member who manages parking garages at hotels and restaurants. This member donated hotel and dining packages on behalf of clients.

Another executive who encourages associations to explore the idea of live auctions, or a combination of silent and live events, is Joe Keefhaver, executive vice president of the National Auctioneers Association, Overland Park, Kansas. "Why not bring in an auctioneer to sell the top 20 or 30 items, then put everything else in the silent auction?" he suggests. "Some organizations hold the auction in conjunction with a banquet to which they charge admission. That's an added source of revenue."

Mathis's organization takes this approach, holding its auction at a holiday party with dinner and dancing. "We have a short live auction during the dinner featuring between 15 and 25 of the best items," she says. She cautions that professional auctioneers keep things moving at a fast pace, and volunteers may not be able to sustain the same level of energy. If handled correctly, however, the benefits can be substantial.

"You'll make more money on live auction items," Mathis points out. "Live auctions are also fun. On the other hand, a silent auction can be pretty unobtrusive at an event planned for another purpose."

Profiting from experience

Even if you decide to go with a silent auction rather than a live one, getting help from the outside is still a good idea, Keefhaver agrees that a professional can provide considerable assistance in planning the event. "We have a number of members who can serve as consultants, advising groups on how to solicit items, comply with sales tax laws, plan the evening event, and handle record keeping," Keefhaver explains. "I suspect the auctioneer's fee could easily be covered by the increased sales total." To solicit help, he recommends visiting www.auctioneers.org and clicking on "find an auctioneer."

Mathis's organization realized the benefits firsthand. "Our income went up when we started using a professional benefit-auction auctioneer," she says. "It was well worth the money we spent to have their help with suggestions for good items and procedure, help with forms, and live auction skills."

Jane Eisinger, assistant editor of ASSOCIATION MANAGEMENT.