| I have never really given much thought to the subject | | | | A note should be added here about the term "reserve |
| of online auctions. Recently, I had the opportunity to | | | | price:" This term applies in all the above methods of |
| research this subject and was rewarded with some | | | | auctions. There are two types of auctions: Reserve |
| very interesting information. | | | | auctions and absolute or non-reserve auctions. |
| Online auctions are, quite simply, a platform or process | | | | Reserve auctions: a minimum bid (or reserve bid) is |
| or method that has been developed to provide bidders | | | | established. If the bidding does not reach the minimum, |
| for products and various services a way to purchase | | | | there is no sale. The reserve prices can be kept |
| from sellers over the internet. This type of business | | | | secret if desired but, if no bids are above the reserved |
| transaction is accomplished through various types of | | | | price, there will be no sale even though bids have been |
| auction software. | | | | placed. |
| Types of Online Auctions | | | | Absolute or non-reserve auctions: these auctions have |
| The three main types of internet auctions are limited to | | | | no reserve prices. The sale is guaranteed as long as |
| these categories: | | | | there is a single bid placed. |
| - Person-to-person auctions - these offer the most | | | | Advantages to Online auctions versus traditional |
| significant diversity in the goods available for sale and | | | | auction houses |
| value. For the most part, you would be dealing with | | | | Online auctions business platforms have a number of |
| individuals in these transactions. But, beware of the | | | | advantages over the traditional auction houses. |
| companies who dump their wares, whole inventories, | | | | - Auctions and sales can take place 24 hours a day, |
| into an auction and set the reserve price for very near | | | | seven days a week |
| the retail price. | | | | - There are no geographical limitations |
| - Commercial auctions - as the name suggests, this | | | | - Large number of buyers who have diverse interests |
| method involves companies who are openly selling | | | | - Transaction costs can be lower because the item |
| their products in this format. Surplus materials and | | | | does not have to be moved until it is sold. Moving the |
| products, equipment that has been reconditioned and | | | | item only once can save significant money depending |
| discontinued items are being marketed. | | | | on the size of the item. Online auction business model |
| - Real-time web casts - these are live auctions that | | | | is an interesting concept born of technological prowess |
| are being broadcast over the internet. Bidders can | | | | to market goods and services. Where else could you |
| place their bids either from the auction location or via | | | | buy a big screen TV for $50 located in Germany from |
| the internet. Pre-registration is almost always required | | | | the comfort of your living room in the United Sates? |
| to participate. Reserve Price | | | | We've come a such long way! |