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Online Reverse Auctions: What is it and where to do it
The concept of a reverse auction is nothing new. Governments and businesses regularly use a reverse auction method, or as they call it, a tender or proposal process to award contracts. Simply put, a reverse auction method is when government(s), business(es) or buyer(s) describe what they wish to purchase and invites sellers of the product or service to bid or compete for the contract. Normally, the seller who offers the best product or service at the lowest price (the closer to pennies on the dollar the better) gets awarded the contract.
Online reverse auctions are beginning to pop up throughout the internet. The reverse auction concept could become a great way to buy auction item(s) you want at a reduced price. Good reverse auctions should allow you the opportunity to place a request for a certain item (like a computer for example) and have sellers of that item compete for your business. In essence, the sellers become the auction bidder instead of you. You usually give a deadline date and time of when your auction will end. Sellers of the product are contacted by the online reverse auction and are invited to bid on the sales price of the item. As the sellers compete for your business, the bid price goes down. Under the online reverse auction system, you could save significantly as more sellers compete for your business. Also, you should have no out of pocket expenses if your reverse auction is not successful.
Good online reverse auctions do not charge fees for placing a request on their website. Also, good online reverse auction sites do not charge any bidding fees like what happens with Penny Auctions. The only fee you should pay is a buyer’s fee should your auction be successful. Normally, buyer’s fees reverse auctions charge range from 3 to 5.5 percent of the final selling price.
Where are some good Online Reverse Auctions to explore?
The only one I found that matched my no cost to bid parameter was Oltiby. Oltiby is a reverse online auction that deals primarily with electronics products. I like this online reverse auction site because there are no fees to join, no fees to post a request, you have a method to back out of the deal if you are not comfortable with the seller and you lose nothing if your online reverse auction request is not successful. If you are successful, you pay an auction fee ranging from 2 to 5.25 percent depending on the end price of the item(s) purchased.
The other online reverse auctions I explored charge you to see a bid on an item or charge you to place an order. You end up spending more on the bidding process than on actually buying what you want. If you find any others that do not charge bidding fees of any kind, I would love to hear about it.
If you want to try Oltiby out, I have an article that provides tips on how to shop safely online. I have used Oltiby once. I bought a Canon EOS Camera from Tiger direct (through them) for $199.95 total price. I did end up saving 60 percent on the price of the camera.
I believe the trend of charging you for each bid placed will end one day and be replaced with a buyer’s fee if your reverse auction is successful. I believe this because there is getting to be a lot of bad press on auctions that charge for bids. This bad press will lead to stricter regulations. These sites may even be considered more a gambling site than an auction site turning more people away from it. The best way to speed up this process is to stay away from any reverse auction site that charges by the bid. In my opinion, buying bids simply clouds the true value of your purchase and transforms the transaction from a product focus to a bid buying process.