E-mail: Name:

November 13, 2002

In this issue:
* From An Auction Gold Reader
* Link To Us
* FEATURE: How To Earn While You Learn: Consignment Sales
* Have Auctions Ruined The Collectibles Business?
* UPS Raising Its Rates
* News From eBay
1. A Giant “BOO!” To eBay
2. Selling 99 Cent Items This Week?
3. eBay's “Quiet Time”
4. Listing Designer Not Free
5. Guns Not Allowed, Rockets and Fighter Jets OK
6. 60 Minutes Dissects eBay
7. What Toys Are In Santa's Sack?
* News From Yahoo Auctions
1. Front Page Showcase
2. Holiday Showcase
* Need Some Holiday (And Every Day) Inspiration?

From An Auction Gold Reader

Longtime subscriber Sherry Gordon has written a Christmas book. She says, “Two Januarys ago (after our second Christmas in Idaho, away from friends and family - and office, and choral concerts, and glitz... all that had become usual), I was thinking about my own changed perspectives on holiday celebrations... and I suddenly felt compelled to grab a pen and clipboard and write things down for a book! I thought to flog it to literary agents - but decided it should just be - out there - to do its little bit of good in the world”.

And it's darn good, too. Some of my favorite parts are:

* Sherry has some excellent insights into “have to” gift giving ... you know - you will feel guilty if you don't, but you have zero inspiration and even less interest.

* I recently had to spend $2500 to have my old patio destroyed and a new one built. The old one had sunk and was causing water problems in my basement. When they dug it up, they found that moles had used the ground beneath as a condominium, and that's why it had collapsed. Sherry's book, believe it or not, has a recipe for mole repellent. Too bad I didn't know about it years ago.

* Recently, I saw a fairly small jar of “vanilla bath” at a store for $7.95! Too expensive for what it was. Sherry's book has a recipe that smells better, and is much cheaper.

* She describes acorn and dandelion coffee. Many southerners know about these because history tells us that is what many of our ancestors drank during the Civil War. Due to the Union blockade, there wasn't any coffee, and no Krogers to go to.

Sherry's book is a modest $14, and $1.40 of that goes to the Red Cross. A job well done, Sherry. Congratulations!

P.S. As I write this, I'm drinking Sherry's cappuccino! Yum.

Link To Us

Once again, Google has proven to be the top search engine on the web. And Google rates sites by their link popularity. So, if you have a website, and aren't a pornographic or adult website owner, let's trade links.

FEATURE: How To Earn While You Learn: Consignment Sales

Folks buy on eBay for two basic reasons:

1. The item is unique or hard to get
2. Price

Naturally, we would all prefer the rare item because we can make more money. But, finding and selling unusual items requires more specialized knowledge.

For example, there is a gold US coin that is currently selling for $406. But here is the title for this auction:

“1895 S $10 LIBERTY GOLD RARE! NGC AU 58 MS PQ”

I don't even understand what that means. My chances of effectively selling these coins aren't good, unless I take the time to acquire some specialized knowledge. But, how do I get this training? And how do I support myself while I am learning?

Here's a possibility ...

Terry Gibbs has made large amounts of money buying and auctioning antique trains. And he says that one way to learn one of these specialized fields is to do consignment for others. In this way, we have no investment, and can be paid to learn.

In our Feature article this week, Terry shares one of those “Uh, oh – what do I do now?” moments.

When you don’t know the value of an item, and you are not willing to risk your money on buying the item you can sell it on consignment and learn while you are selling. I sold a collection of farm toys a few years ago for one of my dad’s friends. Neither of us knew what the stuff was worth, and it was a favor.

In June of 2002, I sold almost $10,000 worth of trains and toys on consignment at a 30 percent rate. After fees and costs, I made over $2200 for fifty hours of work. That’s 440 dollars an hour. You can do this too. You can do consignment sales without an investment, so if you don’t have the seed money to go out and buy collectibles outright, you can do this and build a cash reserve so you can start buying items outright to sell them.

When you sell items on consignment you risk your name and reputation. You take these risks when you sell your own items, but you are in complete control of your actions. In order to lower your risks you need to get complete control of the items you are going to be selling. Here’s an example:

A few years ago, I offered 1350 dollars for a train set figuring I could sell it for between 1800 and 2000. The seller, a man named George, said he wanted 1800 for it. I figured I could pick up a few hundred without risking any of my fast by selling on eBay for the him. I took some pictures and went home and listed the train set on eBay. I did all the stuff I teach in my how to sell on eBay video. I had great pictures, I found the best category. I wrote an accurate and detailed description to give the reader all the information he might want. A week later the train sold for $1875. I told the owner I would charge him 15 percent so I had made 281 dollars less eBay fees for less than an hour of work. I was quite pleased with myself.

I had the buyer send me payment. When the payment came in, I called George to arrange to pick up the train so I could ship it. George told me he had decided to keep the set. Now legally, George and I had a binding agreement and I could have sued him in court and won. The problem was the eBay buyer was not going to wait six months while I got a judge to force George to hand over the set. I ended up sending the buyer back his money along with an explanation. The buyer was understanding, but I ended up getting nothing but aggravation from the experience. I vowed to learn from the ordeal.

Now I always take possession of the items. I tell the seller I have a special set up so I can take wonderful pictures, and if they continue to balk I tell them about George’s train. I refuse to sell anything unless I have possession.

You’ll need a contract with the owner of the item. It doesn’t have to be in writing, but a written contract is less open to interpretation. The whole idea of a contract is to avoid misunderstandings and conflicts. When everything is written out, there is less chance of confusion.

The contract should explain exactly what happens and how in plain English. Include the percentage commission, who pays selling expenses like ebay fees, a minimum selling amount if applicable, when payment is made to the owner, and everything else relevant.

I charge fees ranging between 10 percent plus selling costs to 30 percent and I pay costs. What I charge each person depends on the items and my relationship with the seller. For some sellers, I also charge an hourly fee for cleaning and sorting. Remember, I do this to make money. I have no desire to sell items for strangers unless I can make money.

Terry's new book about how to do consignment selling can be found at:

http://consign.auctionknowhow.com

Possibly the best part of the book is a contract that he paid a lawyer to draft. After all, we don't want to take the heat from irate buyers when we can't deliver on our auctions.

eBay has recently introduced their “Trading Assistant” program, and claims to have 14,000 members. I really have serious doubts that there are swarms of people contacting eBay looking for help in selling. If we are going to really make any money selling on consignment, then I suspect we are pretty much on our own.

Have Auctions Ruined The Collectibles Business?

Recently a friend of mine sent a link request to a collectibles site owner, and received a very cold reply. The writer angrily attacked online auctions, stating that they had “ruined” his market by degrading the prices. He might be interested in this story from the Online Auction Academy newsletter:

CBS Market Watch published a story not too long ago regarding collectibles and their popularity and values due to online auctions. Many experts (read: collectors/appraisers) are bashing eBay and similar auction sites because they are supposedly lowering the value of their favorite collectibles. While the average value of a collectible item commonly available on the market has dropped considerably due to the ease of finding it online, instantly, many items, just because of that, are selling like hotcakes now that they are more affordable.

Sure, Aunt Betsy's dollhouse might be worth less dollars now that the market has opened up to the Internet, but it won't take months to find a buyer for it - it could sell in hours or days instead. Most people would probably agree that they would rather spend $5 in fees and a few minute's time listing that dollhouse for sale (and selling it) than spending untold hours driving it around to "dealers" and running costly ads in newspapers to get the same result.

This confirms the advice I received from a multi-millionaire who has made his fortune selling thousands of antiques for the past 25 years. He vehemently told me that while he does indeed make less money per item than he used to, he is thrilled with eBay and online auctions for three reasons. :

1. The volume that he sells is so much greater that he is making much more money than before.

2. He spent enormous amounts of money on advertising – and even his own TV show – to sell antiques and he no longer has this expense. He has been able to cut way back on his employee payroll, too

3. His merchandise sells much faster, so he is able to spend more time searching and buying antiques than he was able to do previously.

So, are online auctions good for the collectibles market? I guess it depends on what you're selling.

UPS Raising Its Rates

On January 6, 2003, UPS is, sadly, raising its rates. Ground shipping will go up 3.9% and the surcharge for packages going to a home will increase 5 cents a package.

http://www.ups.com/content/corp/about/news/art4212.html

News From eBay:
1. A Giant “BOO!” To eBay

Members of the Auction Genius Course receive software entitled My Auction Manager, which is a wonderful system for managing all your auctions. One of the features is the ability to write your listings, and have them moved to eBay. This includes the ability to refuse bids from buyers with NEGATIVE FEEDBACK. Correction: this USED TO be allowed.

However, now eBay will reject all listings with this stipulation. Non-paying auction winners are a liability to all auction sellers. Buyers with negative feedback are more likely to fit this description than anyone else. We ought to have the right to refuse these people.

I cannot find any announcement of this anywhere on eBay, and emails requesting clarification have been ignored. Apparently they don't want us to know about it.

2. Selling 99 Cent Items This Week?

Until Sunday night, November 17, if you're selling items listed at 99 cents or below, you will get a 10 cent break on your listing fees, meaning you will pay only 20 cents, or 30 cents for a 10 day auction. This offer is good until 11:59:59 PM Pacific time.

This is good only for single quantity items – no dutch auctions or multiple quantity fixed price ones. However, if you list in two categories, the price is only 40 cents, rather than the regular 60.

To learn more:

http://www.ebay.com/promo/startlowpayless/ ?ssPageName=SM:AB01

3. eBay's “Quiet Time”

eBay has often made rule and feature changes during the holiday season – traditionally the hottest time of the year on eBay. This year, they have agreed to make no changes, so as not to confuse buyers and affect seller revenues. eBay states, however, that this does not include eBay Motors or international sites.

4. Listing Designer Not Free

In a move that should surprise no one, eBay is charging for their new “Listing Designer”. This is a template for an eBay listing. For samples see here:

http://pages.ebay.com/sell/designer-landing page/?ssPageName=SM:AB01

One of the secrets to auction success is keeping our overhead as low as possible. Ten cents may not seem like a big deal, but multitudes of these “little” charges add up. Locate some free templates, which are available all over the internet, or learn to write your own pages and avoid these charges. For more info on the templates:

http://pages.ebay.com/community/news/listingdesigner_faq.html?ss
PageName=CMDV:AB0007

5. Guns Not Allowed, Rockets and Fighter Jets OK

Since its earliest days, eBay has supposedly prohibited guns (defined as any implement which is designed to shoot a projectile), including BB guns and antique weapons. They are not allowed even if they no longer work.

BUT ... these auctions are fine:

* MIG 21: Classic Mach 2 Russian Jet Fighter: $231,100

http://cgi.ebay.com/ebaymotors/ws/eBayISAPI .dll?ViewItem&item=1871775187

* MIG 17 Jet Fighter Restoration Project: $29,000

http://cgi.ebay.com/ebaymotors/ws/eBayISAPI.dll?
ViewItem&item=1871929068

(Hey, if you've got nothing better to do this weekend, how about helping me restore my very own fighter plane?)

However, there's really nothing new about this. In our Museum, we have earlier auctions of a Hughes Aim-4D Falcon Missile, a Russian submarine and a Russian military patrol boat:

http://auctionknowhow.com/museum

Where in the world do sellers GET this stuff?

6. 60 Minutes Dissects eBay

In 1995, a San Francisco resident named Pierre Omidyar sat down at his computer and created a new web site. In honor of his city's bay, he called his site “eBay”. According to 60 Minutes, who did a recent story on eBay, Omidyar is now worth an estimated $4.5 billion! (Why didn't I think of that???)

Other interesting tidbits from the 60 Minutes story include:

* 50 million people use eBay
* Buyers spend an estimated $41 million every day
* eBay is largest site on the Web for the buying and selling of used cars, motorcycles and auto parts (a motorcycle is sold every 18 minutes and an SUV every 30 minutes)
* eBay's market value is now higher than that of Bloomingdale's, Macy's, Sears and Toys 'R Us combined.
* NASA shops for obsolete computer parts to keep the space shuttle running
* An estimated 150,000 people have given up their regular jobs to become full-time eBay sellers.
* Profits are up 70 percent in the last three months

http://www.cbsnews.com/stories/2002/10/30/ 60II/main527542.shtml

7. What Toys Are In Santa's Sack?

Naturally, toys are big this time of year, as Santa's annual visit draws nearer. Don't know which ones are popular this year? Perhaps the Toy Guy, Chris Byrne, can help you.

http://www.ebay.com/thetoyguy/?ss PageName=CMDV:AB0009

News From Yahoo Auctions
1. Front Page Showcase

Yahoo is offering a new service that is similar to eBay's - only cheaper. Ebay has a “front page featured” item category. What this means is that on the front page is a “Featured” category. In addition, users are rotated on to the front page of eBay at regular intervals throughout the day. The cost for this is almost $100, regardless of the number of days.

Yahoo is now offering the same option, but for $3/day, and are included in showcases in other categories for free. There are 6 items featured on the Yahoo front page, which can be really great, depending on the time of day. If your turn arrives at 3:00 AM, it isn't so wonderful. Yahoo doesn't have the traffic of eBay, but it's still one of the top sites on the net.

http://help.yahoo.com/help/us/auct/asell/asell-65.html

2. Holiday Showcase

Yahoo is heavily promoting its Holiday Showcase which will run until December 18. The cost is only 20 cents/day.

http://user.auctions.shopping.yahoo.com/showcase/holiday2

Need Some Holiday (And Every Day) Inspiration?

As you most likely know, I like to end Auction Gold with humor or inspiration. Here is a really beautiful page: (works in Internet Explorer only):

http://www.llangley.com/yoga/wisdom/rightnow%5B2%5D.htm