Tips for the beginning seller

I was doing some reading on selling online and found the following article. It has some great information for the beginner and I learned a couple of things.

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Beginner's Guide to Online Auctions

Auctions can be quite frightening for the newcomer. Although it may seem overwhelming, an auctioneer needs to know only a few things to start out on the right foot.

Registration
Registration is necessary for all online auctions. This process is usually very simple, and very secure. However, auctioneers must be at least 18 to participate in most auctions. To complete the registration process, you'll have to agree to the services terms of service or terms of participation. (Amazon.com Auctions calls it a participation agreement.) This information will outline the services dos- and-don'ts -- mostly the don'ts -- such as trying to manipulate prices, selling illegal goods, and other infractions. Use this agreement as a guide for any activity that comes into question.

Know About Fees
Although some online auctions are free, most charge some kind of seller fee. Most sites have insertion fees, or standard fees that are applied when the seller lists an item. These fees are usually very low but can vary from auction to auction. Other auctions may have value based fees or fees that are cut as percentages of the final sale. Whether an online auction uses one fee system or another, it is important to know how they will effect both the seller and buyer.

Know Bidding and Selling Rules
Auctions are rigorously structured, and rightly so. Therefore, it is important to know what your given role in an auction involves. It is important to know what kind of responsibilities both the buyer and seller have in the auction relationship. These may involve bid honoring, payment or shipping. Not only is it important to know these rules but it is also important to know what could happen if you break them.

Auctioning Tips
Like any form of online communication, Internet Auctions have their own etiquette. If an auctioneer fails to use this etiquette, he/she could find themselves losing a sale or at the short end of a bad deal. In general, basic online rules apply. It is important, however, to remember that auctioneers are not always trustworthy and that the buyer (and seller) must beware.

Seller Tips
* Keep It Serious: You wouldn't participate in an auction with haphazardly written descriptions and poorly outlined policies; buyers will expect the same from you.

* Keep it Concise: Avoid lengthy descriptions or worded sales pitches. Although these approaches might work elsewhere, they have no place in online auctions.

* Include a Photo: Photos add to authenticity. Try to include one if you can. Remember to keep it focused and relatively compact.

* Answer Questions: Include an email address and answer questions promptly and thoroughly. People will buy from sources that they can trust.

* Finish It Up: Don't drop your buyers at the moment of purchase. Be prepared for follow up emails and inquiries. You may have the sale now, but you might not in the future.

* Don't Be a Stranger: Don't keep yourself too anonymous. Anonymity creates suspicion and suspicion is the auctioneer's worst enemy.

* Ship it Right: Don't rip people off in the shipping. Try to bundle items together and package them properly.

Buyer Tips
* Start Low: It would almost seem like common sense but it's always a good idea to start bids low. Starting high usually backfires and ends up costing the buyer more than
it is worth.

* Pay Up: When it is time to pay, pay immediately and with the most efficient way. Nothing makes a seller more angry than late payment.

* Ask Questions: If you have a question about an item, don't be afraid to ask. Asking can lead to valuable information and develop better relationships.

* Keep at It: Monitor your auctions and don't leave them alone for too long. Leaving them alone could cost you a small fortune.

* Don't Go Too Far: Take it easy on sellers. They don't deserve being attacked with negative emails or other annoyances.

Auction Formats
There are three main types of auctions online. It is important to know how they differ and how auctioneers function within them.

Dutch Auction: This is an auction in which the seller lists multiple quantities of an identical item. With multiple items up for sale, multiple bidders can win. Also, one bidder can try to buy more than one quantity. All winning bidders pay only the lowest successful winning bid amount. This is different from a Yankee auction, in which each winning bidder pays his or her exact high bid.

Reserve Auction: This is an auction in which the item for sale has a reserve price. The reserve price is the lowest price at which a seller is willing to sell an item. Although the reserve price is not listed per se (the auction posting will be marked as "reserve met"), it can be extrapolated when a bidder bids at or above the reserve price. The high bid will automatically be elevated to the reserve price, providing the current high bidder with what the seller would agree to sell at.

Straight Auction: Also referred to as an absolute auction, this is an auction in which there is only one item up for sale, and there is no reserve price. The seller sets the opening bid and must respect the final price at the end of the auction.

Auction Lingo
* "As Is": Also known as "as is, where is" and "in its present condition." Typically, this is a sign that no return privileges will be granted.

* Bid Cancellation: The cancellation of a bid by a seller. During online auctions, sellers can cancel a bid if they feel uncomfortable about completing a transaction with a particular bidder.

* Bid History:: A historical list of all the bids made on a particular auction during or after the auction.

* Bid Increment: The standardized amount an item increases in price after each new bid. The auction service sets the increment, which rises according to the present high bid value of an item.

* Bid Retraction: The legitimate cancellation of a bid on an item by a bidder during an online auction.

* Bid Rigging: Fraudulent bidding by an associate of the seller in order to inflate the price of an item. Also known as shilling and collusion.

* Bid Shielding: Posting extremely high bids to protect the lower bid of an earlier bidder, usually in cahoots with the bidder who placed the shielding bid.

* Bid Siphoning: The practice of contacting bidders and offering to sell them the same item they are currently bidding on, thus drawing bidders away from the legitimate seller's auction.

* Bulk Loading: Listing a group of different items in separate lots all at once using an online auction site's bulk loading tool.

* Buying Up Lots: The practice of buying all quantities of an item during a Dutch auction. This is typically done for resale purposes.

* Caveat Emptor: The Latin phrase meaning "let the buyer beware."

* Cookie: A piece of information sent from a web server to a web browser that the browser software saves and then sends back to the server whenever the browser makes additional
requests from the server.

* Deadbeats: High bidders who fail to pay for the item they won.

* DNF: Discuss Newest Features board. This is one of the more lively, if not antankerous, message boards in the online auction community.

* Escrow: Money held in trust by a third party until the seller makes delivery of merchandise to the buyer.

* fdbk/fk: Feedback. One user's public comments about another user in regard to their auction dealings. Feedback comments cannot be removed or changed once submitted to an
auction service.

* Featured Auctions: Auction listings placed prominently on the home page and category pages of an auction service. Sellers pay for this prime placement.

* Feedback Padding: One user posting fraudulent positive feedback about another user and his or her auctions.

* Final Value Fee: The commission charge the seller pays to the auction service after his or her item sells.

FVF Request: Final value fee request.

* Grading: The process for determining the physical condition of an item. Different items have different grading systems.

* IMO/IMHO: The message board abbreviations for "in my opinion" and "in my honest (or humble) opinion."

* Initial Listing Price: The opening bid price a seller attaches to his or her auction.

* Insertion Fee: A fee paid by the seller to the auction site in order to list an item for auction,
calculated as a percentage of the opening bid or reserve price.

* LOL: Message board abbreviation for "laugh out loud."

* Lot: A single auction listing.

* Market Value: The highest price a property will bring in the open market.

* Maximum Bid: The highest price a buyer will pay for an item, submitted in confidence to an online auction service's automated bidding system to facilitate proxy bidding.

* Minimum Opening Bid: The mandatory starting bid for a given auction, set by the seller at the time of listing.

* NARU'd: A auction user term to describe users whose memberships have been discontinued. NARU is the acronym for "not a registered user."

* Neg: Short for "negative user feedback."

* Net Cops: Auction users who actively attempt to report instances of fraud, such as shilling or bid shielding, to online auction sites.

* NR: Short for "no reserve." This indicates in the item description line that the auction has no reserve price specified.

* Opening Bid: The seller's opening bid, which sets the opening price.

* Outbid: To submit a maximum bid that is higher than another buyer's maximum bid.

* Registered User: A person who has registered as a member of an online auction service. All online auction services require registration prior to buying and selling.

* Relisting: The relisting of an item by a seller after it has not received any bids or met its reserve price. Typically, the first relisting is free.

* Reserve Price: The minimum price a seller will accept for an item to be sold at auction. This amount is never formally disclosed.

* Retaliatory: The user term for retaliatory negative feedback, posted by one user in response to another user's negative feedback.

* S&H Charges: Shipping and handling charges.

* Secondary Market: The buyer market for secondhand goods. Online auctions serve the secondary market.

* Shilling: Fraudulent bidding by the seller (using an alternate registration) or an associate of the seller in order to inflate the price of an item. Also known as bid rigging and collusion.

* Sniping: Outbidding other buyers in the closing minutes or seconds of an auction.

* Starting Price: The mandatory starting bid for a given auction, set by the seller at the time of listing.

* Terms of Service: A legally binding agreement that outlines an auction site's operating policies. All registered users must agree to a site's terms before using the service.

* User Info Request: A request for a user's background information, which provides personal information, such as a phone number.

© 2005, Ipswitch, Inc.