Wine Auction vs Wine Merchant: Which is Cheaper?
Updated
Comparing the total cost of acquiring fine wine from a wine auction vs wine merchant requires a detailed understanding of all potential fees beyond the hammer price. An auction's hammer price might appear lower. Buyer's premiums, local taxes, shipping, and storage charges can significantly raise the final "all-in" cost. For instance, Sotheby's Global Wines & Spirits charges a 24% buyer's premium plus a 1% overhead premium on all hammer prices. Christie's London Wine sales apply a 25% buyer's premium. Zachys also charges a 25% buyer's premium, and WineBid applies a 17% buyer's premium. These percentages are added to the hammer price. Further taxes like VAT or sales tax often apply to both the hammer price and the premium, depending on the auction house location and the buyer's circumstances. Shipping and storage fees, which vary by provider and duration, also contribute to the final cost. Therefore, calculating the true landed cost is essential to determine which purchasing channel is ultimately cheaper for your specific acquisition.
What are the primary costs when buying wine at auction?
When you buy wine at auction, the hammer price is only the first part of your total expenditure. Several additional costs contribute to the final price you pay. These typically include a buyer's premium, various taxes, and charges for shipping and storage.
Buyer's premiums vary significantly between auction houses and sometimes by sale category. Sotheby's Global Wines & Spirits charges a 24% buyer's premium plus an additional 1% Overhead Premium on all hammer prices, as stated by Sotheby's. Christie's London Wine, Spirits and Cigars sales apply a 25% buyer's premium on the hammer price, according to Christie's London Conditions of Sale. Similarly, Christie's New York charges a 25% buyer's premium on the final bid price for wine, as detailed in Christie's New York Conditions of Sale. Bonhams UK charges a 24% buyer's premium for Wine and Whisky, Bonhams states. Zachys applies a 25% Buyer’s Premium unless otherwise indicated, according to Zachys' Conditions of Sale. WineBid charges a 17% buyer’s premium, as noted in WineBid's Frequently Asked Questions. iDealwine's auctions have a buyer's premium of 25.2% VAT included (21% excl. VAT) as of 02 March 2023. That will change to 25.8% incl. tax (21.5% excl tax) from 27 March 2026, according to iDealwine's General Terms of Service.
Which taxes apply on top of the hammer price?
Taxes are another crucial component. Christie's London states that VAT is payable on the premium and, for some lots, on the hammer price. For lots shipped to Jersey, GST at a rate of 5% will be due. Buyers with a registered address in India bidding via Christie's LIVE™ face an Indian Equalisation Levy Tax at a rate of 2%. That levy falls on the hammer price and buyer's premium. In New York, Christie's collects New York sales tax at a rate of 8.875% for lots collected or shipped to certain states. Bonhams UK adds VAT at the current rate of 20% to the Buyer's Premium. Zachys notes that sales tax is charged for New York Live Auctions and New York Internet Auctions. The State of Delaware does not impose sales tax on tangible personal property sold within the State for Delaware auctions. WineBid collects sales tax on all purchases except those shipped internationally or to specific Direct Shipper States. It calculates that tax on both the hammer price and the buyer's premium. iDealwine's VAT invoicing is dynamic, adapted to the client's status and shipping country. iDealwine charges customs and excise duties to non-EU residents.
Shipping and storage costs also add to the final price. Christie's London charges storage costs from the 90th day following the auction. Christie's New York moves uncollected property to a third-party warehouse at the buyer's expense if not collected within seven calendar days. Zachys requires wines to be collected within 14 calendar days, or it will transfer them to Zachys storage at the buyer's expense. WineBid provides a minimum of two months of free storage at Global Storage Network (GSN), with up to six months for Pro tier members. iDealwine accrues storage fees at a rate of €0.15 per bottle per day, taking effect on the 31st day following the order confirmation.
Here is a comparison of buyer's premiums and key taxes/fees for various auction houses:
| Auction House | Location / Category | Buyer's Premium Rate | Additional Fees/Taxes |
|---|---|---|---|
| Sotheby's | Global Wines & Spirits | 24% of hammer price | 1% Overhead Premium, local taxes excluded |
| Christie's | London Wine, Spirits and Cigars | 25% of hammer price | VAT on premium, sometimes on hammer price; GST for Jersey, Indian Equalisation Levy for India |
| Christie's | New York Wine | 25% of hammer price | Sales or use tax on hammer price, premium, and/or other charges; NY sales tax 8.875% |
| Bonhams | UK Wine and Whisky | 24% of hammer price | 20% VAT on Buyer's Premium |
| Zachys | General | 25% of hammer price (unless indicated) | Sales tax (NY auctions), 2% credit card processing fee |
| WineBid | General | 17% of hammer price | Sales tax on hammer price and premium (except international/Direct Shipper States) |
| iDealwine | Auctions (France) | 25.2% VAT included (21% excl. VAT) as of 02 March 2023; 25.8% incl. tax (21.5% excl tax) from 27 March 2026 | Customs and excise duties for non-EU residents |
How do auction house fees vary by location and value?
Buyer's premium rates can vary significantly based on the auction house, the location of the sale, and the hammer price of the lot. While some auction houses apply a flat rate for specific categories like wine, others use a tiered system where the percentage decreases as the hammer price increases.
Sotheby's, for example, outlines tiered buyer's premium rates across several locations. In New York, the United Arab Emirates, and the Kingdom of Saudi Arabia, the rate is 28% on hammer prices up to and including $2,000,000, as stated by Sotheby's. The same schedule charges 22% between $2,000,000 and $8,000,000, and 15% above $8,000,000. Similar tiers apply in Paris, Cologne, and Milan, with a 28% rate up to €1,750,000, 22% between €1,750,000 and €7,000,000, and 15% above €7,000,000. Hong Kong sales feature a 28% rate up to HKD 15,000,000, 22% between HKD 15,000,000 and HKD 60,000,000, and 15% above HKD 60,000,000. Singapore applies 28% up to SGD 2,600,000, 22% between SGD 2,600,000 and SGD 10,000,000, and 15% above SGD 10,000,000. Switzerland has rates of 28% up to CHF 1,600,000, 22% between CHF 1,600,000 and CHF 7,000,000, and 15% above CHF 7,000,000. For London sales, the rates are 28% up to £1,500,000, 22% in excess of £1,500,000 and £6,000,000, and 15% above £6,000,000. However, for Sotheby's Global Wines & Spirits category, a flat rate of 24% plus a 1% Overhead Premium applies to all hammer prices.
In contrast, Christie's London Conditions of Sale specify that for Wine, Spirits and Cigars, the buyer's premium is a flat 25% of the hammer price, rather than the general tiered rates for other categories. Similarly, Bonhams states that for Wine and Whisky in the United Kingdom, the buyer's premium is a flat 24% of the hammer price. That rate overrides their general tiered structure.
Here is a summary of how buyer's premiums may vary by location and hammer price:
| Auction House | Location / Category | Hammer Price Tier | Buyer's Premium Rate |
|---|---|---|---|
| Sotheby's | New York / UAE / KSA | Up to $2,000,000 | 28% |
| $2,000,000 to $8,000,000 | 22% | ||
| Above $8,000,000 | 15% | ||
| Sotheby's | Paris / Cologne / Milan | Up to €1,750,000 | 28% |
| €1,750,000 to €7,000,000 | 22% | ||
| Above €7,000,000 | 15% | ||
| Sotheby's | Hong Kong | Up to HKD 15,000,000 | 28% |
| HKD 15,000,000 to HKD 60,000,000 | 22% | ||
| Above HKD 60,000,000 | 15% | ||
| Sotheby's | Singapore | Up to SGD 2,600,000 | 28% |
| SGD 2,600,000 to SGD 10,000,000 | 22% | ||
| Above SGD 10,000,000 | 15% | ||
| Sotheby's | Switzerland | Up to CHF 1,600,000 | 28% |
| CHF 1,600,000 to CHF 7,000,000 | 22% | ||
| Above CHF 7,000,000 | 15% | ||
| Sotheby's | London | Up to £1,500,000 | 28% |
| £1,500,000 to £6,000,000 | 22% | ||
| Above £6,000,000 | 15% | ||
| Sotheby's | Global Wines & Spirits | All hammer prices | 24% + 1% Overhead Premium |
| Christie's | London Wine, Spirits and Cigars | All hammer prices | 25% |
| Bonhams | UK Wine and Whisky | All hammer prices | 24% |
What additional costs should you consider for auction purchases?
Beyond the hammer price, buyer's premium, and standard taxes, several other costs can impact the total price of your auction wine. These include storage fees, shipping and transport expenses, credit card processing fees, and potential VAT refunds.
Storage fees are a common consideration. Christie's London charges storage costs from the 90th day following the auction, unless otherwise agreed in writing, as stated in their Conditions of Sale. Christie's New York will remove property to a third-party warehouse at the buyer’s expense if not collected within seven calendar days of the auction. If lots are uncollected for 120 calendar days, they are stored at The Wine Cellarage, according to Christie's New York. The applicable terms and charges appear on their website. Zachys requires wines to be collected within 14 calendar days or they will be transferred to Zachys storage at the buyer's expense. WineBid offers a minimum of two months of free storage at Global Storage Network (GSN) for all customers. Collector tier members receive four months and Pro tier members receive six months, as per WineBid's Frequently Asked Questions. iDealwine accrues storage fees at a rate of €0.15 per bottle per day, taking effect on the 31st day following the order confirmation, according to their General Terms of Service. Proper how to store wine is essential for preserving your investment.
Who pays for shipping and transport?
Shipping and transport expenses are often the buyer's responsibility. Christie's London states that you must make all transport and shipping arrangements, though they can arrange packing, transport, and shipping for a fee. You are also responsible for determining and satisfying the requirements of any applicable laws or regulations relating to the export or import of any lot. Those requirements include taxes and tariffs. Christie's New York similarly places responsibility on the buyer for shipping arrangements. Christie's New York ships to New York, Florida, New Hampshire, and Wyoming. Specific quantity limits and fees apply for New Hampshire (12 9-liter cases or equivalent per year, 8% fee) and Wyoming (108 liters per year, 12% fee). International shipping to Hong Kong and London is offered. Zachys can assist with arranging packing, transit insurance, and shipping at the buyer’s expense and direction. You are responsible for any tariffs, duties, taxes, or other governmental charges that may arise. WineBid partners with Global Storage Network (GSN) for shipping services, with options and estimated rates available via their wine shipping calculator. iDealwine states that customs and excise duties are not included in the buyer's premium for non-EU resident customers and are charged in accordance with legislation. You are responsible for checking any authorisations and formalities required for exports and imports.
Which smaller fees should you budget for?
Credit card processing fees can add to your costs. Zachys charges a 2% processing fee for credit card payments. Christie's New York also notes an administration fee for all credit card transactions.
VAT refunds may be available for non-UK buyers from Christie's London if all applicable conditions are met. However, Christie's charges a processing fee of £35.00 per invoice to check shipping/export documents, which Christie's waives if its Shipping Department arranges the export.
Currency conversion rates are another factor. Christie's saleroom video screens and Christie's LIVE™ may show bids in other major currencies for guidance only. Christie's states they cannot be bound by any rate of exchange used. Zachys accepts payments in United States Dollars for US auctions and Hong Kong Dollars for Hong Kong auctions. For requests in other currencies, Zachys determines the currency exchange rate at its discretion. iDealwine's reference currency is Euros.
What are the risks and guarantees when buying at auction?
Buying fine wine at auction involves specific risks and guarantees that differ from retail purchases. Understanding these terms is crucial for protecting your investment.
A fundamental aspect of auction purchases is that lots are often sold "as is." Christie's London states that lots are sold "as is," in the condition they are in at the time of the sale. That sale carries no representation or warranty or assumption of liability of any kind as to condition. Christie's New York similarly notes that all property is sold "as is" without any representation or warranty. Zachys' Conditions of Sale state that all wines are sold "as-is," and WineBid's Frequently Asked Questions confirm that all purchases are made 'as is.'
What does an authenticity warranty cover?
Authenticity warranties provide some protection. Christie's London offers an authenticity warranty for wines and spirits. Christie's may issue a refund if the buyer satisfies it on two points. Within 21 days of the auction date, Christie's must receive written notice from the buyer. That notice must claim the lot was short or ullaged, or that a catalogue statement of opinion was not well founded. Christie's must also have the lots in its possession in the same condition within 14 days of such notice. Christie's New York has a similar authenticity warranty for wine, with the same 21-day notice and 14-day possession requirements. However, the buyer has no rights under this condition if the defect is mentioned in the Sale Particulars, the catalogue description was in accordance with generally accepted opinion, or the defect could only be established by an unreasonably expensive or damaging scientific process. iDealwine states that its auction organiser, International Wine Auction (IWA SARL), guarantees that wines will be authentic and conform to their published descriptions.
What allowances must you make on older bottles?
For older wines, specific allowances must be made for natural variations. Christie's London advises that buyers of old wines must make appropriate allowances for natural variations of ullages, conditions of cases, labels, corks, and wine. Christie's accepts no returns on that basis. Christie's New York further clarifies that corks over 20 years old begin to lose their elasticity, and that levels can change between cataloguing and sale. Old corks are also known to fail during or after shipment. Zachys echoes this, stating that buyers of old wines must make appropriate allowances for natural variations of ullages, conditions of cases, labels, corks, and expressions. Zachys adds that corks over 20 years old begin to lose their elasticity. iDealwine notes that information regarding wine levels, status of corks, capsules, and labels are only indicative, and the auction organiser cannot guarantee the condition of the cork. Furthermore, iDealwine cannot guarantee tasting characteristics for purchased wines. For more information on condition, consult our guide on wine ullage levels explained.
Regarding "bad" wine, WineBid explicitly states that "there is a small, yet inevitable percentage of ‘bad’ wine impacted by things like cork taint, imperfections during production, oxidation, and other factors which can’t be observed until the bottle is opened." By participating in their auction, you accept that all purchases are made "as is," and WineBid does not offer refunds or exchanges for such issues.
Finally, auction houses generally limit their liability for bidding errors. Christie's states that their written and telephone bidding services, Christie's LIVE™, condition reports, currency converter, and saleroom video screens are free services. Christie's is not responsible for any error, omission, or breakdown in these services. Zachys, its affiliates, and auctioneers state they have no liability for any errors, omissions, or failures related to the execution of any bids, including those resulting from internet or platform connectivity failures. WineBid notes that bids cannot be canceled and all sales are final. iDealwine states that placing a bid is an irrevocable and legal act, and once an order is placed, it cannot be cancelled or modified. They also state they cannot be responsible for technical difficulties preventing customers from placing bids. When you are ready to bid, our guide on how to buy wine at auction can help you navigate the process.
How do merchant prices typically compare?
iDealwine offers "Fixed-Price Sales" on its electronic platform, which do not require bids. For these sales, prices are indicated as all-inclusive of tax within the European Union, with VAT at 20% for Metropolitan France, and exclude shipping costs. Crucially, iDealwine states that "There is no buyer's premium to add to the indicated price" for these fixed-price sales. This contrasts with auction purchases, where a buyer's premium is always added to the hammer price, along with applicable taxes and other charges. When considering a wine auction vs wine merchant purchase, a fixed-price offering from a merchant or platform like iDealwine presents a more straightforward cost structure. The listed price is closer to the final amount you pay, before shipping and any specific customs duties for non-EU residents.
Determining whether a wine auction vs wine merchant purchase is cheaper ultimately depends on a careful calculation of all associated costs. The hammer price at auction is only one component. Buyer's premiums, taxes, shipping, and potential storage fees can significantly increase the final outlay. For example, a 25% buyer's premium on a £1,000 hammer price adds £250, before any VAT or shipping. Understanding these variable costs is crucial for making an informed decision. To accurately compare the total cost of acquisition, use our landed cost calculator and explore the latest market trends with our comprehensive fine wine market index. These tools help you assess the true all-in cost of your next fine wine acquisition.