Saving and Making Money with Online Auctions
by Nikki Willhite
www.allthingsfrugal.com
A guide to helping your budget with online
auctions
I love eBay. I have never been to a public auction, but I spend
a lot of time on ebay. I have been selling on eBay for a couple years now. I
have also purchased a dozen or so items.
There is an incredible variety of items put up for auction on
ebay. I must admit that every so often I type "grand piano" in the search box,
and drool over the Steinways! These pianos usually have multiple bids on them,
and sell for well over 5 figures.
Ebay is a great place to both save and make money. If you are a
crafter, it is great place to sell your crafts, year round. I have sat at a
craft fair all day. I about went crazy! It is so much easier just to list your
items, and let the Internet do the work.
You may also have items around your home that are of value that
you may wish to sell. The key to selling anything effectively is research. You
need to browse around the site. See what other people are selling. Read their
remarks. See how many bids they have had on their items. Track them and see if
and how high they sell.
As far as buying things, you don't want to get carried away!
However, there are incredible deals to be found. Try searching for things like
children's clothing, toys, jewelry, collectibles, books or whatever you need.
The secret to winning auctions is to come in at the end and make
your bid. See how much time is left, and then put in your bid 5 minutes
beforehand.
People also do what is called "secret reserved bids". Let me
give you an example. Say you were interested in a large lot of children's
clothing. There is a current bid on it for $4.50. You wait until the last 5
minutes, and put in a bid of $5.00 (the next increment up). The computer tells
you that you have been "outbid". This means someone else has put in a higher
bid.
Every time that you put in a bid under the secret reserved
price, the computer will put in the next bid for the other buyer, until the
reserved price of the first bidder has been reached. If this other person has a
reserved bid of $10.00, you will have to bid higher than that to beat them.
So, coming in the last 5 minutes may not be enough time if you
have to keep bidding to get above a reserved bid. If you really want something,
you can determine the highest amount you would be willing to pay for it and put
that in. Then, if you are still outbid, you just forget it. Or you can put in a
reserved bid yourself. Your bid will show as the next incremental bid, and you
won't have to pay the full reserved price unless other bidders raise the price.
One thing to watch for is the postage. I never buy anything
unless the seller states how much they want for the postage, or else they say
"buyer to pay exact mailing charges" or something to that effect. Then, I can go
to the US Post Office website and use their calculator to figure the approximate
cost:
http://www.usps.gov/
Unfortunately, most people only ship to the US, because of the
costs involved.
Another type of reserved bid is set by the seller. They may list
the starting price as $4.50, but if it says "reserve not yet met", this means
that they have set a price that they will not sell below. Unless the bids on
their item reach that price, it will not be sold.
Safeguards
There are several things you should always do when buying to
protect yourself. One of them is to always check the feedback of the seller. It
will give you the comments of other buyers. People who do business with
regularity on eBay work hard to build up a positive profile. If they have a good
history, you will have more confidence in the transaction.
There are also safeguards when you use ebay's checkout, and pay
with a service like Paypal. I have been using paypal for a long time. It is a
wonderful convenience for the sellers and buyers. You can pay with an electronic
check or credit card. The seller receives the payment right away, and you
receive your merchandise quickly
Sellers are protected in several ways.If a buyer refuses to
follow through on the sale, eBay will contact them for you. If they still don't
pay, eBay will refund your listing fee. They also take 5% of the selling price
and that will be refunded also. If your item doesn't sell the first time, you
can relist it, and ebay will refund the listing fee if it sells the second time.
You have access on your selling page to all the people who have
bid on your item. If the winner of the auction does not follow through, you can
also contact the other bidders and ask them if they would like to buy your item
at the price they bid.
To Protect all Buyers always post feedback about your
transaction. When you register with ebay, you have a section called "my ebay".
This is where a record of your transactions is kept, and you post your feedback.
Buyers who don't follow through receive a warning. After two
warnings, they are banned from ebay.
Occasionally I have a buyer who claims to have never received
their merchandise. I contact other people they have dealt with to determine
their credibility. There are a few "bad seeds", but they are usually pretty
discernable.
Use this tool to pick up some extra money. It can be fun, both
buying and selling. Be warned, however. The average person who visits eBay
spends 45 minutes there! It can take up some of your time. Have a look, and see
if it might be something that will help your budget.