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This chapter is from the book

Five Common Bidding Mistakes

You’ll learn some tips on how to be a better bidder in Chapter 9. But let’s take a moment and examine some of the things you can do wrong—actions that can either keep you from winning or cause you to pay too much.

Mistake #1: Bidding Too Early

When you’re interested in a particular item, it’s tempting to place your bid as soon as you read the item description. The problem with this is that as soon as that bid is entered, you’ve announced your intentions to other bidders—who might then react by placing even higher bids. So, right away, you’ve started a bidding war—which you could lose.

There’s really no benefit to bidding early in a long auction. So what if you place your bid on day one of a seven-day auction? The only bid that really counts is the one that’s in as the auction closes. Besides, when you bid early, the bidding price goes up faster. It’s better to hold off and place a later bid, one that other bidders won’t have as much time to respond to. Bid early, and you’re likely to either lose to a higher bidder or unnecessarily drive the price higher; bid later, and you’re more likely to win—with a lower bid.

Mistake #2: Bidding Too Low

If you really, really, really want to win a particular auction, there’s no point in being cheap. You think you can get by with a low-ball bid, so that’s what you offer. The problem is, if the item is really worth a higher price, someone else will bid that amount—and you’ll lose the auction.

It’s especially tempting to bid low when the seller sets an unrealistically low starting price. Don’t get suckered in by a low price early in the auction. If you think an item is really worth a particular price, bid that full amount. Remember, eBay’s bidding software automatically sets the current bid level for you, so you’ll never pay more than you have to—and if there’s not much bidding, you might actually end up paying a lower amount. But if you want to win, you have to bid high enough to beat all other bidders. Don’t be cheap!

Mistake #3: Bidding Too High

On the other hand, don’t be a dummy and bid an unrealistically high amount for something that isn’t worth that much. You’d be shocked at how many items sell for more than their fair value on eBay; a lot of buyers just don’t know what things are worth when they place their bids, and end up overpaying. Do your homework ahead of time, and find out what that item is really worth. Then place an appropriate bid—and don’t bid more than that. If you get outbid, tough; the item wasn’t worth that much, anyway!

Mistake #4: Getting Caught Up in a Bidding Frenzy

One reason that many items sell for too high a price is that it’s easy to get caught up in a bidding frenzy. If an item is popular and several bidders are interested, you’ll see the current bid price keep going up and up and up as each bidder tries to stay in the game. I know the feeling; when bidding starts to heat up, you don’t want to lose. So you keep placing higher bids, trying to stay a few dollars ahead of the other bidders—and end up bidding up the price way too high.

The solution to this problem is simple—don’t lose your head in the heat of the moment! Set a maximum amount you’ll pay for the item, and do not—repeat, do not—bid any higher than that amount, no matter how hot and heavy the bidding. It’s okay to lose one every now and then!

Mistake #5: Not Reading the Fine Print

You’ve found an item you want. The bid price is reasonable. You think you can win the auction, and get a pretty good deal, besides.

But when the auction ends, you get an email from the seller telling you that the final price is several dollars higher than what you expected. That’s because the seller added a shipping and handling fee to the selling price. Now, you should expect to pay shipping/handling; that’s your responsibility as the buyer, and you should factor that into your total cost of the auction. But many inexperienced bidders get surprised by this charge and end up with an unsatisfactory auction experience.

So make sure you know what the shipping and handling fee is before you place your bid. If the seller doesn’t include this fee in the item listing, email him with your ZIP code and ask him to estimate the fees to your location. And always be on the lookout for higher-than-normal shipping/handling fees, or other unexpected charges. You probably don’t want to pay $10 to ship a $2 item—especially if the actual shipping might be only half that. Although it’s common for sellers to include a "handling charge" on top of actual shipping charges (to pay for boxes, packing material, and so on), you don’t want to pay too much over the actual costs. Jacking up the handling charges is one way unscrupulous sellers make a little extra money on each transaction, and you don’t want to play along. Bottom line? Be sure to read the fine print before you bid—especially where it concerns shipping and handling charges.

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