Basic Rules.

Basic Rules.

Online auction provides a convenient place and cost effective method of doing business for both buyers and sellers. Buyers can inspect the goods being sold virtually, and without leaving the confines of their homes or offices, or wherever they can access the internet. It also provides sellers an unlimited market where they can sell their wares without lesser operating costs.

However, internet auction should be viewed with caution as some sales made through online auctions have been known to be characterized by fraud and transaction irregularities such as, but not limited to shipment delay or no shipment at all, inferior product quality and payment problems.

Online auctions are pretty much the same as regular auction except that the latter is done through the internet and without the physical presence of buyers and sellers as well as the goods to be auctioned. A traditional auction can be quite stressful, particularly when you have to physically bid for the products you want. Online auction is more relaxing as you can do it alone and without disturbance.

How can sellers initiate an online auction? Online auctions may be done between persons and business enterprises, or between persons who auction their items to their online buyers. Online auctions between persons are done after the seller has registered in an auction site. Registration is required before the seller can show his wares for bidding. A fee is also required to be paid by the seller, when he placed items for auction.

Just like in traditional auctions, the seller may specify a minimum bid or price for the auctioned item which he may or may not disclose. The seller may also have the items auctioned for a limited period only. When the time for the bidding is up, the bidder who offered the highest price wins the auction. However, if the bid price is below the minimum bid set by the seller, then he may choose to close the auction without any winner.

After the auction, the seller and his buyer can make arrangements, usually through emails or instant messengers, as to the manner of shipment and payment of the auctioned goods.

Payment for auctioned items is usually done through credit cards, checks, or by money order. Auctions sites also avail of payment services through Papal or Direct Wire Transfers. Other auction sites make use of the escrow system, one of the preferred methods of payment due to its safety features. Under the escrow system, the buyer deposits the payment to an account or escrow service, and the payment is only released to the seller when the seller has received the item and approves it.

Online auction buyers should be careful in joining online auctions particularly if they are not so well versed with the process involved. To make sure they are not duped, buyers should:

1. Familiarize themselves with two or more auction sites and compare which rule or process is better and safer.

2. Look for protection offered by auction sites like insurance for undelivered items or if the items delivered are below the standards promised by the buyer.

3. Make sure they know the items they are buying, its description, present market value and other characteristics.

4. Scrutinize the seller and make sure the seller is legitimate. Be wary of sellers who suggest negotiations outside the auction site. Check the seller's feedback and rating, and if possible, get his contact details.

5. Determine the options you have in the shipment and delivery of the product, and whether or not the seller offers free shipment of the product.