Online Auctions - Are They Credible Businesses?

Are these businesses scams?

While there is always the potential for an online form of commerce to be a scam, the dangers that are inherent in these auction transactions are ever present. Issues like privacy, security and a lack of direct contact with the seller / buyer are ever present and, when the transaction becomes an international one, the dangers increase significantly. The best way to find a reputable, credible and viable auction platform is to evaluate each of the below listed areas carefully. The less than reliable platforms will be weeded out fairly easily if you will just do your homework

How do you test their credibility?

Here are some things you might like to look for when evaluating some of the online auction sites on the internet:

• Traffic volume and locality
• The prominent posting of their privacy policy that guarantees that the site will not sell any of your details, will not spam you, and will provide a secure link whenever you must enter credit card details.
• The site should have clearly defined policies and procedures in case disputes occur.
• The site should provide some sort of rating system for both buyers and sellers so that one can identify sellers who have not lived up to their end of the agreement.
• Look for clearly outlined fees and commissions. Most sites don't charge the bidders to participate outside of their bid amounts; however, for sellers there is frequently a minimal fee for listing items. There could even be commissions to pay when an item sells. Collect this information from different sites and compare them to get a picture of the fees and rates involved.
• The site should have some support services for escrow monies and services; PayPal for example. These are important services that protect both the bidder and the seller. They act as an intermediary, providing a more secure method for the buyer to pay for the product. The buyer pays the escrow service, a small service fee is deducted, it is held in escrow and then it is sent along to the seller to complete the transaction after the buyer has received the goods in acceptable condition.
• There needs to be an international payment and shipping option as well. Online auction marketplaces are world-wide platforms. This can become a concern for both buyer and seller if one or the other prefers not to participate in international sales.

James Wittering writes for LuckyBidder, an online auction site focusing on penny auctions.