When it comes to running a profitable auction business, one of the most important—but rarely tracked—metrics is “cost per lot.” This simple KPI measures how much it costs in labor to catalog each lot, calculated by dividing your labor cost by your “lots per hour” rate.

Here’s how it works: If your team catalogs 20 lots per hour and your fully loaded labor cost is $60/hour, your cost per lot is $3. Simple—but powerful. This number gives you immediate insight into whether your cataloging process is efficient and profitable. 

If you’re not already tracking this KPI, take a moment to think back to your last auction and estimate your cost per lot. Then run the actual numbers—be sure to include all the hidden costs like mileage, payroll taxes, and other incidentals. Was your estimate close? Higher? Lower? Drop a comment and let us know how your guess compared to reality.

Why does it matter? Because not all auctions are created equal. If you're spending $4 to catalog a lot that sells for $100, you're in good shape. But if you're spending $6 to catalog a $10 lot, your margin shrinks fast—and so does your bottom line.

Many auctioneers avoid tracking metrics like cost per lot—not because they’re lazy, but because they love what they do. Enjoyment of the auction process often overshadows the business side of things. But understanding these numbers doesn’t take away the passion—it protects it. By knowing your true costs, you can make smarter decisions, book better auctions, and ultimately keep more of what you earn at the end of the year.

We recently completed a small auction that involved moving items out of a garage, cataloging them, and then moving everything back in. Including all the setup, handling, and cataloging time, our three-person crew spent a total of 20.5 hours to complete 183 lots. At a labor rate of $30 per hour, that brought our cost per lot to $4.47.

Tracking cost per lot helps auctioneers make better decisions about which sales to take, how to price their services, and where to invest in efficiency. It turns your time into data—and data into smarter business.

Want to start tracking your cost per lot? Time a session, tally the labor, divide by lots. That’s your number. And it just might change how you run your next auction.