Interested in finding the right auction for the items you wish to own, or have an auction of your own for a local charity? You will need to understand the different types of auctions available and how to manage your way through to win that item. Now that we have discussed primary auction types for bidders reference, lets discuss secondary auction types.
Secondary Auction Types:
Buyout auctions: These are auctions with a set price for the items up for bids. The bidders can accept the buyout price anytime during the auction ending the bidding immediately. If there is no buyout auction placed before the end of the auction, the winning bid goes to the highest bidder. Important to note- buyout options may either be permanent or temporary. With temporary buyout options, once a bidder has placed abid the buyout option is no longer available. With permanent buyout options, the buyout option remains the same throughout the auction until the close of bidding. With these permanent buyout options, the buyout price can fluctuate depending on the preset rules of the auction or the decisoin of the seller. Get all the necessary information at the start to avoid problems and confusion.
No reserve auctions: Or Absolute Auctions, these are auctions where the items up for bidding will be sold regardless of the price. These types of auctions attract larger crowds because there is a high potential for getting items at much lower than cost prices. Yes, bargains galore. However, with more bidders comes more competition, which may eventually lead to paying more. Always set your own highest bid price befor ethe bidding starts, it’s easy to get pulled into the excitement.
Reserve auctions: In this type of auction the seller reserves the right to accept or reject the winning bid. The set reserve price is known to the auctioneer, but not necessarily to the bidders. The set reserved price can be fixed or discretionary. Discretinary meaning that the auctioneer decides whether or not to accept a bid depending on the winning bids price. If you are a seller, a reserved auction is best and safest for you to get the worth of the item, but keep in mind that these types of auction usually don’t attract as many bidders.
Silent auctions: This is much like an English auction listed in Primary auction types. Bids are written on pieces of paper, and at the predetermined set end of auction, the highest bidder wins. Most commonly used for charity events where there is less overhead such as the price for hiring an auctioneer. This is more profitable to the charity. Similar to sealed bid auctions.
Top Up auctions: Much like silent auctions, these types of auctions are commonly used for charity auctions. Except the bidder must pay the difference between their bid and the second lowest bid whether they win or not. In this type of auction only the winning bidder does not pay the top up fee, they just pay for the item. These types of auctions garner a lot more money going to the chosen charity, but does loose some of the excitement of placing a bid.
All Pay auctions: Similar to Top up auctions in that bidders must pay their bids regardless of winning the item. The highest bidder wins the item, but all bidders pay. These types of auctions are commonly used for academic persuits as well as political affiliations where bids are listed as political contributions.
Reverse auctions: These auctions are performed backwards. Meaning the purpose of this auction is to drive the price down for the bidders’ advantage, not up for the sellers.
Walrasian auctions: In this type of auction the auctioneer takes bids from both the buyer and seller for multiple goods. The auctioneer either raises or drops the proposed price depending on the bids of both the buyer and seller. This type of auction ends when there is a balance in supply and demand.
Having this list as a quick tutorial will undoubtedly save you time, and frustrations in the wide world of auctions. There is a lot of work involved in both bidding and selling through an auction and having the right information before you go will help you to enjoy the event without confusion or loss of money. Get out there and start bidding.
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