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ShoppingSpot > Features > Auctions 101

Auctions 101

SOLD to the young lady sitting behind the black MacBook.

No need to thumb through the Christie's catalog or wave hand signals at the gentleman behind the podium. All you need is your computer, an Internet connection and some common sense to venture into the world of online auctions. Whether you're after silver candlesticks circa 1870 or a domain name, you'll probably find it on one of the many auction sites.

Going, Going, Gone

  • eBay
    The behemoth of the exploding auction niche, eBay touts 5.6 registered users and more than 3 million items for sale. The company has been rained on by the media with stories of babies and body parts for sale, but eBay states clearly that sales of drugs, stocks, Government IDs and yes, human parts are indeed prohibited. Buying items on eBay is free, but if you want to sell, you'll pay a listing fee that is determined by the opening value, reserve price or category of your item. If you listed a Snoopy Sno-cone Machine for $5.00, you would be charged $ 0.25. If you'd like to sell a plot of land in North Platte, Neb., you'll pay a $50.00 listing fee.

  • Auctions
    Where would an e-commerce extravaganza be without Amazon? In addition to purchasing books, videos, toys and music, you can auction here. Again, no fees for buyers. However, sellers pay a $0.10 per item listing fee and a closing fee, which is a percentage of the winning bid price.

Play It Safe

Ready to buy or sell a hot item? Follow these auction safety tips.

How to Buy

  • Pay by credit card when you can. If you never receive the merchandise, you can contest the charges with your credit card issuer.

  • Check on the seller's reputation. If you can't, consider it a red flag.

  • Avoid impulse buys. Auctions don't always deliver the best price. Do your research first to determine fair market value. PriceWatch is a good source for this. See also ShoppingSpot's Comparison Shopping.

  • Determine who will pay for shipping and return policies.

  • If you bid at a person-to-person auction and win, you will probably be asked to send a personal check to a stranger. Look for sellers with a clean history. Ebay offers a "Feedback Forum" where buyers and sellers can post comments about a seller, which form the seller's "feedback rating." The higher the number, the better chance you're dealing with an honest individual. But the system isn't foolproof - sleazy sellers sometimes give themselves false praise.

  • Make sure you bid carefully, you most likely will not be able to withdraw.

  • If a deal seems too good to be true, it probably is. Pass it by.

How to Sell

  • Create an honest, but attractive description of your item. Use pictures if possible.

  • Price your item to sell, but not lower than you are willing to sell for.

  • If you are willing to spend a little extra, consider boldfacing your listing or paying for additional exposure on the auction site.

  • Respond to all inquiries about your item as soon as possible.

  • Once the auction ends, get in contact with the bidder as soon as possible.

  • Once payment or other terms of the agreement are met, fulfill your portion of the agreement by delivering the auctioned item.

If you are weary of buying items from a complete stranger, online auctions might not be for you. However, some escrow sites will act as an intermediary between auction buyers and sellers for a small transaction fee. If you win, you pay iescrow first, the seller ships you the goods, you approve the sale, and iescrow pays the seller.

Speak the Speak

  • Dutch Auction
    Term used to describe an auction of two or more identical items that allows all buyers to purchase the items at the lowest successful bid.

  • Reserve Price Auction
    An auction where the seller sets a "reserve price" or the lowest price he or she is willing to sell an item for. This amount is generally higher than the minimum bid. In order to win the auction, a bidder must meet or exceed the reserve price and have the highest bid. If no bids meet the reserve price, the transaction will not take place.

  • Shilling
    When the seller of an item bids up their own item or asks another person to do so. This is a practice looked down upon in the auction community!

  • Sniping
    The practice of placing a bid in the closing minutes or seconds on an auction. Pretty sneaky practice, but there are ways to avoid getting burned by snipers. See eBay's description of Proxy Bidding and try this tutorial and test bid.

Report Fraud

The following sites keep an eye out for fraudulent vendors. If you've been burned, report your incident. If you don't want to get burned, visit these sites before partaking in the process.

Happy bidding!

   --- S. Benes

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