If the web has been the great equalizer for frustrated writers who had difficulty getting their message published, online auctions have had the same effect on closet entrepreneurs. Online auctions allow just about anyone with internet access to put up nearly anything for sale, and have it available to a worldwide audience for bidding. This virtual yard sale has led to some auction fans changing their careers to become full-time online auction merchants.
The providers of the various online auction services have made it very easy to post items for sale and to bid on them. All that is normally required is to register as a user (a free process), and for sellers to fill out a form for the items they wish to offer.
A small fee is charged by the auction site for each item offered. This fee is frequently refunded, or a second auction is offered at no cost, if the item doesn't sell.
Bidders browse the offerings, which are sorted by category, and enter their bids by filling out another online form. The system notifies users by e-mail when they are the high bidder on an item, when a previous bid has been topped by another user, and when the auction has closed and what the results were. The buyers and sellers then contact one another by e-mail to arrange the final sale.
Some great bargains can be had via online auctions. I needed a wide-- anglecamera lens but the cheapest one that I could find retail was priced at $280. Searching the auctions on the Amazon.com site for "wide-angle Pentax K-mount" keywords, I found a seller in Arizona that had an entire set of Pentax lenses for $150. His camera body had been stolen and he had replaced it with a model that took different lenses. I was the only bidder, and the sale was complete within a few days. I sent him a check, and he sent the lenses, professionally packed. I wound up with three high-quality lenses, plus an assortment of filters and other accessories, for less than the retail store cost of one lens.
There was a chance that I would be sold a box of bricks, or nothing at all, and have no recourse except to travel to Arizona and hunt down the scam artist. Fortunately, frauds perpetrated via online auctions have been extremely rare. eBay, the first and the largest online auction site, reports fewer than 30 complaints of fraud per one million transactions - a fraud rate of less than 0.001 %. The chance that a retail merchant will shortchange you is probably greater than that.
For pessimists and skeptics (which includes most cops), there are safeguards available. Amazon.com's auction service was new at the time I made my purchase, and they offered a free "insurance" policy for all transactions below $250, guaranteeing against fraud. Insurance is still available on most auction sites, although there is typically a maximum insured loss of $2500 on any single transaction, and there is sometimes a small charge. Transactions on eBay are automatically guaranteed against fraud by Lloyds of London, up to a loss of $200, minus a $25 deductible.
There are also escrow services available that act as a go-between for the buyer and seller: once an auction is complete, the participants agree on the use of an escrow service and the buyer sends payment to the escrow service. Because most escrow services accept credit cards, this also allows sellers without merchant credit card accounts to sell via plastic. When payment has been received, the seller is notified by the escrow service to send the merchandise. When the buyer receives it and reports that he is satisfied, the escrow service pays the seller, and the transaction is complete. Escrow services charge a small fee (less than 5%), based on the purchase price of the item.
What Can I Buy (or Sell)?
You can deal in just about anything. The evolution of the online auctions sites have caused some merchandising rules, mainly because of problems created by the offering of certain sensitive merchandise. …