Without Bidding.

The most common Dutch auctions are actually a combination of two auction types: theyre multiple-item fixed price auctions (Dutch Buy it Now auctions to you and me). This just means that you can offer more than one of an merchandise at a instant for a fixed price.

This is very powerful if youre selling something small in large quantities. You can just say how many of the item you have, and the Buy it Now auction will stay there until its duration is up or all the items have been sold.

Buyers arent limited to only buying one product at a time, either: they may enter how many they want and then just click Buy it Now to get them. If youre selling small things loose, then this might be really good - instead of selling them in packs of 50, you might sell 24 to one person and 95 to the next. It lets buyers save money by buying exactly what they positive need , and it lets you offer them the flexibility to have as many or few of an merchandise as they want.

With Bidding.

Dutch auctions can also be done by bidding, but the process is rather complicated. Buyers bid a price and say how many items they want, and then every one pays the lowest price that was bid by one of the winning bidders. Lets say there are 10 of an merchandise for sale. Anne bids $5 each for 4, while Bob bids $4 for 6. Anne will get her 4 and Bob will get his 6, but they will both only pay $4.

Heres another example. If there are 5 items for sale and Anne, Bob, Carol and Dean want to buy 2 each, then obviously someone is going to lose out. Whoever bid the lowest will only get one of the product. If Anne bid $5 each, Bob bid $4 each, Carol bid $3 each, and Dean bid $2 each, then Anne will get 2, Bob will get 2, Carol will get 1 and poor Dean gets nothing. So then: how much they pay for the items?

Starting to sound like a particularly evil math problem, isnt it? The answer is that all the people will pay $3, as Carols bid was the lowest one that won anything. If you have trouble getting your head around that, then dont worry - many people else does too! Thats why Dutch auctions with bidding are so rare.

In fact, even eBays normal one-merchandise auction format has all sorts of problems, not least of which is auction sniping. Snipers are buyers who come along at the last minute to bid a few cents more than the highest bidder and win the merchandise . Your buyers will find this infuriating - and youre the only one with any power to help them out by stopping it. The next e mail will show you what you might do.