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Just a comment or two on the use of reserves. As a dealer
who sells quite a few items via the internet auction circuits,
I am aware that reserves are a necessary and important tool.
So as not to lose money, if an item is selling during an
auction crash, or if the item gets overlooked by the buyers,
we must in some cases use reserves.
But, I have a problem with reserves that are set far above the
minimum bid. I believe a reserve should be set at no more than 3
times the opening bid, in fact twice the opening bid works very well
in most cases.
It is very discouraging to make numerous bids, hoping to get the
item for a fair price, only to reach your limit and still not
make the reserve. After a half hour of re-bidding on 2 or 3 items,
a buyer becomes fatigued and usually will NOT go on to other items.
He or she just wasted a great deal of their bidding time.
I have seen items started at $10- and the bids reach $6000- with the
reserve still not met. Just as when you use the search engines,
you will usually not go through more than 2 or 3 pages before you
quit. If a buyer needs to get say $500- for an item, and he starts
it for $200-, the bidders will generally be able to have an idea
of what the reserve will be, and decide whether or not to take the
time to bid. The buyer will view and bid on many more items, to
everyone's benefit.
I also think the auction site should be set up to allow a bid that
does not reach the reserve, to advance to the maximum that the buyer
has bid. If an item is starting for $10- and the reserve is $100-, why
increase bids by $1- or $5- each? It wastes time. Instead as in the above
case the reserve is $100- and the buyer bids $75- the bid should be taken
right to $75- 1 bid versus 10 or more.
The proxy bid will still protect the buyer. If he had
bid $150- he would have the item for $100- unless another buyer
bids more. I sometimes start items at the price I need to get,
without a reserve so the buyer doesn't have to guess at what he
will have to pay. It can scare the buyers off if the item is a
high priced article, but usually works well for low to moderately
priced items. If we make it easier for the buyers to bid, than
everyone wins.
or send comments to the author, Ed Duer
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