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The Sotheby’s Debt Soap Opera

Patrick Drahi
This is an overdue change given Sotheby’s extensive network and services, but it also masks a bolder move: Sotheby’s has announced it will stop giving its best clients some of the house’s fees. Photo: Christophe Morin/IP3/Getty Images
Marion Maneker
April 23, 2024

Sotheby’s recently announced new fee structure officially went into effect yesterday. For the sales in May, the auction house is charging 26 percent on all bids up to $1 million; 20 percent on $1 million to $4.5 million; and 13.9 percent thereafter. But for anything signed up after yesterday and sold after May 20th, Sotheby’s will charge a much simpler 20 percent up to $6 million and 10 percent thereafter. To make up for the lost 6 percent for bids up to $1 million, Sotheby’s will now enforce its vendor’s—or seller’s—commission of 10 percent on all lots up to $500,000. 

The new structure ostensibly accomplishes a few objectives. Sotheby’s would appear to be cutting prices in a slowdown, inducing buyers to bid more by mollifying their sticker shock over the house’s fees. Bidders have already lost patience with the add-ons that come on top of the hammer price. At Sotheby’s, it starts with a 27 percent commission—26 percent plus a 1 percent overhead fee—and then the buyer adds local sales tax and some hidden costs like shipping. The house is also hoping to shift some of its fee burden from the buyer to the seller, for whom it also provides significant value. On some level, this is an overdue change given Sotheby’s extensive network and services, but it also masks a bolder move: Sotheby’s has announced it will stop giving its best clients some of the house’s fees.