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News Article
Manion’s owner “all in” despite fiscal problems
KANSAS CITY, Kan. – In February 2006, a press release entitled "Three Years After Tragedy, Manion’s Auction is Back on Top," was released to business publications throughout the country.

However, today some consignors with Manions would argue the business is anything but "on top."

The Better Business Bureau has given Manion’s an F rating and the Kansas Attorney General has 25 complaints filed against the firm.

The press release - distributed by PR Leap - recalled the May 4, 2003 storm which devastated the Kansas City Metropolitan area, including the facilities at Manion’s International Auction House.

"Today, Manion is as good as new - new facilities, new equipment and most recently, new ownership," the release continues. "Jody Tucker acquired the company from Ron Manion in 2005, and he’s taking the company in a different direction."

"We’re getting a lot of new consignment and selling more than ever," an employee is quoted as saying. "It’s an exciting time (to) be working with Manion’s."

But , the press release did not mention that when Tucker - a former CEO and partner of a software development company – bought Manions, the company was losing more than $1 million a year, and was in arrears to consignors for more than $2 million, by Tucker’s own accounting.

And – from a fiscal standpoint - things do not appear to have gotten any better.

During the past four years, the Kansas Attorney General’s office has received 25 complaints, "mainly from consignors who have not received the revenue from sales," according to Gavin Young, a spokesman for the AG’s office.

All 25 cases are still considered open, and investigation and attempted resolution of these accounts are still ongoing, Young said.

The Better Business Bureau has given Manion’s its lowest grade, an "F," based on 44 complaints filed against the company during the past three years. Most of those complaints were regarding "billing or collection issues," according to BBB documents. Of the 44 complaints received, 27 were closed as "resolved" during the past year.

But it’s on the Internet where complaints against Manion’s are the most scathing. Several consignors maintain they have never been paid, months after their items have sold; others maintain it has taken more than a year to receive their money.

"It’s not that people aren’t being paid," Tucker told AntiqueWeek. "It’s just that it’s taking too long … we’re not stealing people’s money. We’re a struggling company. We’re having problems, just like a lot of companies now."

Tucker admitted that the company was "behind several million dollars."

Tucker said he knew back in "early 2005" when he was buying Manion’s - at the time one of the largest online auction houses in the world specializing in historical military collectibles - that there were "payoff issues."

"In 2005, it was a wreck financially," he says. "There was the tornado, and that set them back on just about every level. But, I thought it was a turn-around situation, and I still - today - think it can be turned around."

Tucker has a longtime affiliation with Manion’s, having worked in the summer of 1985 while still a high school student for Ron Manion when the business was operated out of Manion’s home.

Tucker has publicly acknowledged that he "personally put money into the company and borrowed additional funds to try and shore up the company operating losses. In subsequent years, I cashed in my 401k and sold the majority of my personal collection to keep cash coming into the company."

But, now the money has dried up, he says. "I can’t get a bank to talk with me," he said. "We used to have lines of credit … now, that’s gone. Money is tight."

In January 2008, Manion’s created a "List It Yourself" service, based something on the eBay concept, where consignors could list their own items. It was one of "new directions" that Tucker instituted in attempts to make the business more solvent.

But yet, the business is still playing "catch up" with consignors.

Tucker confirmed that revenue from current auctions is being used to pay consignors from auction events several months ago. That includes auction results from dealers, estates, "List It Yourself" services and single consignors, he said.

"It’s pretty much across the board," he said.

Admitting the company’s best year was "a loss of $63,000," he acknowledges there were a lot of problems when he "bought in" Among them: the company’s overhead was too high, the existing inventory was overvalued, and consignors were using sales to make purchases. Sales volume at Manion’s has decreased considerably also, he adds.

But, little of that washes with consignors who put their trust into Manion’s Auctions.

"Your consignment fee for an auction is 20 percent. Anything above that is the consignor’s money … not yours," writes a poster from the Wehrmacht-Awards, a web forum devoted to collectors of the German Wehrmacht (1935-1945) era. "You do not have the right to invest it any way you feel … you are taking that money to make payroll for employees, pay bills, etc."

Several posters accuse Manion’s of operating a Ponzie scheme, an illegal operation that pays investors from money paid by subsequent investors, rather than from any actual profit earned.

"I don’t mind constructive criticism but when people on this and other forums call us a Ponzi scheme and imply that we are stealing and making money off consignor’s money, it’s time to set the record straight," Tucker counters. "The company has not made a single penny since I’ve owned it."

Young, at the Kansas Attorney General’s office, says there is no subjective point at which the government will act.

"We can take a variety of steps," he says. "We can take a heavy-handed approach and go for seizure of assets, shut down the business, that type of thing. But, then we risk our goals of protecting the consumer … we do that and we recover 20 cents on the dollar, or something like that. Our first goal is to protect the consumer, and we can’t do that by putting the business out to pasture."

Like many other consignors, Matthew Roth of Bloomfield, Colo., has experienced the "erratic and slow payments" from Manion’s. His problems, he says, predate Tucker’s purchase of the firm right up to the first of this year.

Roth deals mainly in small military collectibles, primarily World War II-era material. He is a member of the Wehrmacht-Awards forum, and an active presence at militaria shows and other events.

Roth admits that he pulled back on sending his best material to Manion’s and - perhaps unlike the average consignor - he wasn’t particularly in need of immediate payment following an auction.

"I had my problems with Manion’s, but I called and spoke directly with Jody Tucker," he says. "And I think he was open with me, and we tried to figure out some ways of resolving the problems. A couple months ago, he switched me to a new consignor name and we set up a new program."

In April, Roth consigned 194 items; May, 134; and in June 51 items. Manion’s has made good on his auctions, he said, within the agreed-upon 30 day terms.

"I think Jody’s really trying," Roth says. "A lot of these problems existed before he bought the business … Manion’s was known as just a pile of trash (reproductions and fakes), and Jody has cleaned that up … I know that’s a quicker fix than money problems … I think things are improving, and I think he may turn this thing around … though, it’s not a quick fix and he has lots of fences to mend."

7/2/2010
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