Online Auction Tips
If you've never participated in an online auction before you might be a little hesitant. Auctions are fun and can be quite exciting (if not addicting). Today's Online Auctions make it even easier to enjoy the auction method of buying from the comfort of your own home, or practically anywhere. To help you out we've provided a few tips, follow these and you'll soon find yourself not only comfortable with the online process, but loving it!
Know Your Auction Company! Ensure that your auction company has a good reputation for being fair and ethical. The best way to determine this is to ask around. As in all professions there are good and not so good. Find out how long the company has been in business, if they are a member of professional organizations such as the National Auctioneers Association or the State Auctioneers Association. Another way to determine this is to attend one of their previews / inspections and ask questions. Are they easy to understand, courteous, is there staff professional?
Know The Terms! Terms of each auction house are posted (or should be) on their web sites and auctions. Is there a "buyer's premium" added to the final bid price? Are credit cards, personal checks, accepted? If you're not shipping, when do items need to be picked up, are there reserves on any items? Get this information in advance of participating in the auction, and if you're not sure - Ask.
Attend The Preview / Inspection! Most auction houses have viewing dates and/or times prior to the auction. Come early and inspect items of interest thoroughly -- most items are sold "as is, where is". This means that there is no refund or return of the item if you are not happy with it, or if there is damage to it that you didn't notice. Be sure to preview every item you plan to bid on, and if you're not sure - don't bid.
Ask Questions! Most auctioneers and staff are very helpful to beginners. Ask about anything you don't understand or any concerns you have. Things you should always know include: when and where is the pick up, if shipping - the process, are any extra charges (premiums, sales tax) are added to the bid, are buybacks (defined below) allowed, and what methods of payment are taken.
Determine your price limit! It's possible to get caught up in the bidding excitement. Determine -- in advance -- your limit on specific items, and stick to it! (Remember, taxes and buyer's premiums are added to the final bid).
Be sure to know where the auction is - today's online platforms (Proxibid, AuctionZip, Biddspotter, HiBid, Bidwrangler) host hundreds/thousands of auctions. It is now easier than ever to be redirected to different auctions with similar merchandise (sometimes a little too easy). This is important for shipping / local pick ups - making this mistake could have you buying furniture on the other side of the country with no way to get it!
Get your login set up early - if new to the platform, get your login ready before the closing day of the auction. Typically it's a simple strait forward process, but if something doesn't go right you'll have time to get it resolved before the auction ends.
Place some bids before closing day - another way to make sure you're ready to go before the auction closes is to make some small bids. This makes sure your account is good to go and also "marks" items for you as you look back at the auction catalog.
It usually takes one to get the hang of it! You've got your account, placed a few bids, got your questions answered - you're ready to go. Relax and enjoy the auction - after that first one you'll think there's nothing to this!
SOME AUCTION TERMINOLOGY
Buyers Fee / Buyers Premium
This is an additional cost to the buyer that is applied above the amount of the bid price for the item. This is a very common practice with online auctions and has more mixed use with live auctions. This is used by auctioneers for the additional costs of online hosting fees, photography and set up costs, advertising, credit card fees, and additional compensation. Simply take the amount of your bid price and add the buyers fee / premium % to determine your total cost. Example you bid $100 with an 18% buyers premium - you will owe $118.
A lot number is the numerical number of that item (or group of items being sold together). Synonymous with catalog number, It is typically the sequence number for the items in the auction - ie. Lot #1 is first followed by 2,3 ...
By the piece or times the money
This is a typical method for selling sets of items such as chairs. If four chairs were being sold "by the each" or "times the money", the bid price is for one chair however you are buying all the chairs so that bid price is multiplied by the quantity. For example if you are the successful bidder on a set of four chairs being sold - "by the each" or "times the money" and you bid 20 dollars - you have purchased all four chairs for a total of 4 * 20 or $80. This is usually indicated in the bidding display area.
A group of items grouped together and sold as one "lot" The phrase box lot is used as the group of items is usually organized in a box or cardboard flat. Note that box lots are typically not inspected or have the same level of damage detail called by the auction company.
"As is, Where is"
This means the item is sold in the condition that it is in - with No warranty, No guarantee, No statement of authenticity, and no returns.
A buyback occurs when the owner or consignor of the item bids and/or buys it back at auction. These are not usually known by the audience. Buybacks are allowed by some auctioneers and not others.
A reserve is a minimum amount the item will sell for on an item. If the item does not sell for the "reserve" amount, it is not sold. These are handled differently by auctioneers also. Some state them upfront, some sell the item and if it doesn't reach the reserve, they inform the high bidder with the option to buy at the reserve price. If the buyer declines, the item is not sold.
A minimum bid that will be accepted for an item. This is typically the online starting bid unless a reserve is applied.
The increment is the amount between the current bid and the next bid. The bid increments usually increase as the value of the item increases. For example our items typically start at $1 with a bid increment of $1 until the item reaches $25 and then the increment changes to $5, when the value reaches $100 it changes to $10, and continues to increase as price points are met. These will change automatically during the bidding process, but there is usually a link to see what these increments are in the auction catalog in advance of bidding.
Soft Close / Extended Bidding
A "Soft Close" or "Extended Bidding" simply extends the bidding time on an item if a bid is placed in the last 2 minutes. All bidders will then be given an additional amount of time to place another competing bid, just as you would at a live auction in person. This will continue until no bids are placed for 2 minutes - This allows all participants to have an equal and fair chance of bidding. Extended Bidding is used by almost all online auction platforms.
Collusion is actually against the law. Collusion is an unethical auction practice done by buyers by making an agreement with other bidders to not bid against them for whatever reason.