Thursday, 8 March 2012

Online Auction

What are online auction sites?

Online auctions are generally just like real life auction houses. A seller of an item lists it for so many days and then the bidding starts. As long as the reserve is met the person with the highest bid wins, pays for the item and then you post it to them.

What are the costs when selling on online auction sites?

Online auction sites will generally charge you a listing fee (a price to list the item) and then they will take commission from the sale. Usually this is about 2.4% but the value will depend upon the price the item sold for and the auction site you are using. Additionally if you are allowing your buyers to pay via online payment methods such as paypal, there will be additional charges to you as a seller for the payment handling and if the buyer was outside your country then currency exchange fees may also be charged on top of it.

As a seller on online auction sites you are expected to also post the item so postage and packing costs you will also need to pay. However if you listed the auction correctly the seller will pay for the post and packing of the item.

What are the costs when buying on online auction sites?

Generally you do not have to pay the auction site to bid on an item (although there are some online auction websites which do charge you to buy bids). Usually the only costs a buyer on an online auction website will incurr are the final sale fee and cost to post the item.

For example:

If your winning bid is of £20.00 GBP and and the postage is £1.50 to post the item.
It will cost you £21.50 in total.

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