Thread: a serious axe

I have never understood, and this is not just confined to razors, why Ebay sellers place high reserves and low starting prices. if a seller wants to make $400 (as might be the case with this razor), why does the seller not just start the bidding at the reserve price or put a BIN?

I understand that Ebay sellers want to get higher numbers of bids because it (1) increases interest and (2) might help it show up higher in search results (such as sort by number of bids). But at the end of the day, doesn't it put a damper on bidding once bidders see that there have been 41 bids, and a $365 price with reserve not met?

Even worse, it seems that reserves could prevent a bidder from actually paying a higher price to buy the razor. Let's assume that the highest bidder right now has his max bid entered at $500 (with the reserve at $400). Now, the problem here is that this bidder could not win the auction until a second buyer bid him up to the reserve threshold. At the same time, the reserve not met could discourage a second bidder from even trying to outbid the first one.

Originally Posted by Bordee

If a seller wants to make $400 (as might be the case with this razor), why does the seller not just start the bidding at the reserve price or put a BIN?

I was JUST saying this to a couple people!

WHY OH WHY don't people set the starting bid at the LEAST amount of money they will take?
All the bids before are USELESS and it just me off!

Preach it, Chevhead. I totally agree !!!

Originally Posted by Bordee

Even worse, it seems that reserves could prevent a bidder from actually paying a higher price to buy the razor. Let's assume that the highest bidder right now has his max bid entered at $500 (with the reserve at $400). Now, the problem here is that this bidder could not win the auction until a second buyer bid him up to the reserve threshold. At the same time, the reserve not met could discourage a second bidder from even trying to outbid the first one.

I thought if this was the situation, the person bidding $500 would get the razor at $400 because they bid past the reserve. Is that not what happens?

That is not the way it worked the one time I bid on a reserved item. It did not go so it will be back around for a third round i'm sure.

Originally Posted by TwistedOak

I thought if this was the situation, the person bidding $500 would get the razor at $400 because they bid past the reserve. Is that not what happens?

That's not how the reserve works. The reserve has to be exceeded via actual bidding, not by the winner's maximum bid that is being offered.

By way of example, say that an item is listed at $1 and has a reserve price of $500. Imagine that there is only one bidder who makes places a maximum bid of $1,000. The bidder's offer only moves the auction price to $1 (the item would be listed as $1, with 1 bidj). The only way that this item could get hit the reserve price is if a second bidder placed a max bid for at least $500.

Now, let's use the same facts and have the second bidder place a max bid of $500. The auction would move from $1 to $500 and the reserve would now be met.

So in short, you can see by this example the pitfalls of the reserve system. The first bidder is willing to bid more than the reserve price, but cannot even pay over the reserved price because the first bidder needs a second bidder to move the auction price.

A much savier seller would at the very least set a Buy it now price above the reserve price. Here, if the seller placed a $750 BIN price, our buyer who was willing to pay a max of $1000 could actually pay over the seller's reserve price without needing a second bidder to move his first bid up.

thanks for the long, detailed explanation. I understand what you were describing, I just thought a reserve acted almost like a bidder.

Wouldn't that edge stick out from the bottom of the scales?

For the guy that accesses this thread 3 months from now when the ebay link is gone .......... ;

Jimmy, I was going to do that but glad you did. And as for the guy that bid a 1,000 and didn't win,,,,,I would have contacted the seller and asked what he wanted for it. Simple solution to an other wise confusing situation. The reserve price is sort of a joke to me. When ever I see a listing with that I just click away. I figure, here is a guy that wants waaaay to much and is willing to try anything to get it.