Buying and Selling Through Online Auctions

Lately, auction houses have joined the ranks of the hottest places to pick up bargains or unusual items on the Net. Not only are online auction houses great places to pick up new and used merchandise ”and especially hard-to-find collectibles ”but the bidding process can be a lot of fun, too. eBay, at www.ebay.com (see Figure 15.10), might be the most popular online auction house now, but there others, including the following:

• Yahoo! Auctions ” auctions.yahoo.com

• Amazon.com Auctions ” auctions.amazon.com

• Auctions.com ” auctions.com

• Butterfield & Butterfield ” www.butterfields.com

Figure 15.10. eBay, a popular online auction house.

Also, you'll often see links to auctions on retail sites. You can bid on an item you might otherwise buy outright , and maybe save a bundle.

How Online Auction Houses Work

Although you can usually view the items up for auction without registering, you typically must register with the auction house ”a quick process of filling in an online form ”to bid on items or to sell an item. Once registered, you can use the search tools or categories on the auction house's page to browse for items to bid on. Note that most auctions go on for several days, and some go on for a week, so it's not necessary to sit in front of your computer for hours to join in the fun.

The auction house usually has no role in the actual financial transaction between seller and buyer, so a secure page is not really necessary. Typically, if you win an auction, the auction house emails both you and the seller to notify you about the win and to give you each other's contact info . After that, you and the seller have a set period of time in which to contact each other to arrange payment and shipping. Many sellers who use these auction houses are commercial merchants who can accept payment by credit card via email or telephone. Some individual sellers might require that you pay by money order or personal check.

eBay features a Feedback forum (see Figure 15.11) where buyers and sellers can post positive and negative comments about their experiences with each other. Before buying, you can always check out the comments others have made about the seller to determine whether that seller is a safe person to do business with.

Figure 15.11. Some auction houses have feedback forums so you can see what others have to say about a person before you do business with that person.

To minimize the risk on bigger-ticket items, auction houses offer links to escrow services that make purchasing a little safer for buyer and seller (for a fee, of course).

The buyer pays the escrow service, not the seller. The seller does not ship anything until he knows that the escrow service has the buyer's money. When the buyer informs the escrow service that the item has arrived, the escrow service pays the seller.

Bidding Tips

If you want to try, here are a few important tips:

• Always check out the feedback about a seller before bidding to make sure the seller is reliable.

• Before you bid on an item, always search the Web or other sources to see whether the same item is for sale elsewhere and for how much. That way you can be sure not to bid more than you would pay for the same item elsewhere. (Try a shopping agent for this.)

• Check out any payment terms in the listing. If no terms are listed, use the links provided to email the seller and ask what forms of payment the seller accepts (check, money order, and so on). You might want to think twice (or use an escrow service) before dealing with a seller who accepts only money orders, which is the second riskiest way to pay by mail after cash.

• Don't get carried away. In the heat of the auction, it's easy to get caught in a bidding war and wind up paying way too much for that Elvis candleholder you think you simply must have. Decide the most you're willing to pay and stick to it. If you lose, there will be other auctions.

Selling Tips

If you're interested in trying to sell something online, here are a few quick tips:

• Be honest ” Don't overstate the importance or worth of the item you're trying to sell. Don't call it an antique unless it is one. Don't call it one-of-a-kind and then sell another one next week.

• Be realistic ” Everyone thinks his or her own stuff is worth more than it is. If you have something that's worth more to you than it would be to anyone else, that's a keepsake. Why sell it? Keep your minimum pricing reasonable.

• Provide a picture ” Descriptions are great, but most people want to see the real piece. A high-resolution photo will help drive your price up.

• Send it quickly ” As soon as you receive payment, send the item you sold. It'll ease anxiety for the buyer, and help drive up your rating on the auction service.

• Check other means of selling ” Sometimes, the newspaper or online classifieds are still the best way to sell an item.

Using a Payment Service

Online payment services like PayPal (www.paypal.com) and Billpoint (www.billpoint.com) offer secure transactions that can allow you to send or receive a payment instantly. All you have to do is set up an account at one of the services, and you can start using it to buy and sell.

The payments are processed rapidly , and the security of the transaction allows the merchandise to change hands more quickly.