Reserve Prices: So, Whaddayah Do When. . .

[joeintexas]

I have bought several guns on sites like gunbroker but like so many others I skip over the reserve auctions, I just don't have time to mess with them. I know what I will spend going in on any certain gun and if the current bid isn't shown I figure its more than I'll spend anyway and just move on.

 

[Marine Corps Air]

Here's my impression of the strategy. Bought far too many firearms on GB & GA. This is not to say that the Sellers are not misinterpreting the goals.

My experience has been that some Sellers set the starting price at some low dollar amount, i.e. $100.00. Set the posting for fourteen days. However, if the Seller has $800.00 in the firearm, he/she should not sell for $100.00. It's also very difficult to determine what Buyer interest will be during that fourteen days, or if the Seller wins the "GB Lottery" by having a "Newbie" or "Bidding War" happen. Most of us have see a final selling price significantly higher than the BIN price!

As an example, in the situation above, if it were me, I'd set the "Reserve Price at $1,000.00 to cover my cost, plus the GB fees, make some Profit, etc. I'd set the BIN at $1,250.00 or so to approximate "market value", whatever that is, for the Buyer who just absolutely has to have it before the fourteen day period expires and to guarantee that no one else wins the auction.

To BlueRidgeBoy's point, I don't believe that Buyers should ask what the "Reserve Price" is. That's "bad smoke" or stupidity on the Buyer's part. In a few cases, when I have made an initial inquiry of the Seller (before I bid), some Sellers have disclosed the "Reserve Price". A Seller has that option, for whatever reason the Seller chooses.

Bill

 

[b_san]

I am sorry that I did not make myself clear. The seller has the option of removing or lowering their reserve. If they lower their reserve to below my bid and no one outbids me I have to either buy the item or get a non-paying bidder black mark on my account. As long as my bid is high spending the money elsewhere would put my privilege to bid at risk. At least that is the case on eBay. I'm assuming Gone Broker is the same.

It's not, once a bid has been placed on a GunBroker auction, the listing can't be changed, it only canceled if it hasn't met the reserve.

I have 2 reactions to hidden reserve auctions on GB: 1) I ignore them or 2) If it's something I'm really interested in, I'll email an offer to see if the reserve is reasonable to my expected value. Sometimes I've grabbed nice guns at reasonable prices as everyone else had skipped over them and the seller was happy to sell at his reserve price.

TLDR: Reserves kill auction interest.

 

[Absalom]

Expressing disdain for reserve auctions has been a hallowed ritual here for many years.

But as with any pet peeve about a practice in a functioning, entirely voluntary free market, it's entirely pointless.

Based on my observations, very few private sellers place reserves on GB. It's almost all commercial sellers. And it has been their practice for some time.

So skipping over auctions with reserves may work for you, and seeing how many people seem to agree here may give you the illusion that reserves somehow are a bad idea for sellers.

Apparently, they work for sellers, since they keep doing it. And selling the guns they need to sell to stay in business. And that is that.

 

[LVSteve]

Expressing disdain for reserve auctions has been a hallowed ritual here for many years.

But as with any pet peeve about a practice in a functioning, entirely voluntary free market, it's entirely pointless.

We have a winner!!!

 

[JH1951]

Getting people involved in your auction is the key. Involved is bidding or watching. Reserves turn some people (not all) off and away. Fewer participants typically means fewer bids, and less money at the end of the day. If you really want bidding activity, and bidders invested in the auction, you must invest in it too with faith. Faith in this case is faith in the auction site being the right place, and your listing being done exceptionally well with description and pictures, and being able to convince folks you have a good reputation (a fair amount of good feedback) - as an example on GB check out the listings by the Woodlawn Boys...... Also, faith that you are going to land on your feet with respect to price by receiving a fair market value, and starting the bidding at $0.01 with no reserve. If your expectations are beyond what a fair value for your piece may be, you likely need to set a reserve and not have the piece sell because you chased away buyers and the price was excessive.
How many times have you seen a GB auction go below market value if the listing was placed in the right spot, had a very good description, and had a bunch of nice clear pictures showing all details? By the same token, how many times have you marveled at the excessive prices some of these well presented pieces brought?
And again, success in this arena needs faith on both sides. The buyer needs to be convinced that you are a reputable seller. I have backed away from many online purchases due to lack of good feedback for the seller. So, as with your reputation around where you live, an auction site reputation takes some effort to build. I would not make my first auction listing one for my most prized piece..... that is inviting disaster.

 

[Minorcan]

I buy at a lot of auction sites. I will bid and buy an item with a Buy It Now option. I freely bid on items with no Reserve. I totally ignore items with a Reserve and most times will not even read the description. It's my choice.

When I first started with auctions I would follow items a Reserve. My thought was I could learn about values and such. What I found is in almost all cases the Reserve was significantly more than the value of the item. This was recently proven again when a brick and mortar gun shop I buy from (several guns this year) also list on GunBriker. I went to the shop and saw several guns I was interested in buying. I went to his GB site. The guns I was interested in were up for auction. In each case the Reserve was 10-15% more than what his prices were in his store and his Buy It Now price was 15-25% more than his store price. Now, in some ways, this is good for him, the seller as someone somewhere may pay his price. But for many buyers they just won't bid. I noticed that he rarely sold the guns with Reserves even after many weeks or months. I went back and asked him for his best in store price on one of his listed guns. He cut the price by 12%. The Reserve would have cost me 27% more than the real value.

The moral is, I don't waste my time or money on items with a Reserve.

 

[gregintenn]

I find that good pictures, an accurate and honest description, and a starting price of one cent and no reserve will fetch the most money for an item.


If you don't want to tell him your reserve price, don't.


I've asked questions about items with a reserve, and many times, without asking for it, the seller volunteered the reserve price.

 

[jag312]

I bid on a gun on Gunbroker. I didn't meet the reserve, and I was the only bidder. The gun was relisted. I contacted the seller to see if in the event that no one bid on it, could we come to some deal on the gun. We split the difference between my original bid and the reserve. The seller is happy. I'm happy. I'm waiting for the gun to arrive.

 

[H Richard]

There is one very prominent seller on Gunbroker that specializes in S&W's, and high grade high price ones at that. His auctions are always no reserve with a penny start price. He sells a lot of guns and gets a good price.

 

[Sevens]

Expressing disdain for reserve auctions has been a hallowed ritual here for many years.

But as with any pet peeve about a practice in a functioning, entirely voluntary free market, it's entirely pointless.

Based on my observations, very few private sellers place reserves on GB. It's almost all commercial sellers. And it has been their practice for some time.

So skipping over auctions with reserves may work for you, and seeing how many people seem to agree here may give you the illusion that reserves somehow are a bad idea for sellers.

Apparently, they work for sellers, since they keep doing it. And selling the guns they need to sell to stay in business. And that is that.

You write that intellectual piece and post it in a discussion ignoring the absolute obvious -- that this thread was opened by a private seller that uses a reserve and given all the feedback in this discussion... could perhaps possibly suspend that practice of his, while you assure the rest of us that voicing our disdain has no merit?!

Haha, your next post should be your own 5-star review of this post. A true "expert" endorsement!

 

[k22fan]

Answereing the original question ...

I do not sell so I would not be asked the question, but "Whaddayah [B.R.B, not me] Do When ... people on auction sites send you emails asking you to tell them your reserve price?" Since disclosing your reserves works against your selling philosophy, reply writing you do not disclose your reserve prices. Regardless of price or anything else, it will be a cold winter in hell before I bid on a sellers stuff if they will not communicate with me. If they will not respond to questions there is good reason to believe they will not resolve any problems that arise completing the sale. I am not the only shopper who takes that precaution.

B.R.B. did not originally ask if it was wise for him to continue setting reserves. He will not get bids from me or many other members who replied here if he does but that does not answer his original question.

 

[Skwirl]

An auction with a reserve gets me to look at the current bid. If the reserve not met, and close to what I'd pay, on to the next
A reserve, or buy it now defeats the purpose of an auction.

 

[Absalom]

You write that intellectual piece and post it in a discussion ignoring the absolute obvious -- that this thread was opened by a private seller that uses a reserve and given all the feedback in this discussion... could perhaps possibly suspend that practice of his, while you assure the rest of us that voicing our disdain has no merit?!

Haha, your next post should be your own 5-star review of this post. A true "expert" endorsement!

So if I understand your convoluted construct correctly, you are accusing me of sabotaging everybody's cunning plan to persuade the OP to stop using a reserve price? Well, somebody forgot to send me that memo, or I would have gotten right with program!

But since the cat is out of the bag, I'm just going to repeat the obvious: Sellers keep using reserve prices, so those reserves are obviously not the killers of buyer interest which many folks claim they are.

 

[Sevens]

The best sellers NEVER use them.

And no, read again as you definitely FAILED to get my point. You boldly said that everyone's opinion is whatever, and useless when shared in this or any discussion. You're mistaken.

 

[Bullseye 2620]

Here's what GB itself has to say about reserve prices:

Reserve Price auctions are often unpopular with bidders because the Reserve Price is hidden, and they must bid until they meet or exceed this price. We recommend you set your Starting Bid to the least amount you will sell the item for, and let the bidding begin at that price. When priced fairly, the item will probably sell for a higher price than your Starting Bid.

I think that is probably good guidance.

 

[llowry61]

BRB - I don't even look at auctions with reserves. I have purchased many guns over the internet and agree with a comment above. Respectfully respond to the seller and advise that you do not disclose your reserve.

I also agree with the strategy of GB that you posted. It seems to be the most transparent approach. Something about reserves just turns me off.

My 02 FWIW.

L

 

[Jack Flash]

Sounds like a self-correcting problem. If BRB finds his hidden reserve auctions end satisfactorily, then why change? If instead they attract very few buyers, he may want to consider dropping the hidden reserve price.

 

[HOUSTON RICK]

IF I want something then I put in what I am willing to pay and let the chips fall where they may. If someone has the time to sit around and outbid me by $1.00. I let them have it, If you want to use a reserve price for any reason that makes no difference to me. I figure when some asks your reserve price, they are asking "What is your best deal?". No harm in telling them what you are willing to sell something for.

 

[straightshooter1]

I skip over the auctions with Reserve Prices, too. It seems to me to be a waste of my time.

If I bid and did not meet the Reserve, then I'd have to keep checking on the auction to find out (1) if the
reserve gets met and (2) then whether the price now is one that I could live with and whether i want to bid again.

With no Reserve, I bid what I am willing to pay, and leave. I might check the item as it nears the end of the Auction, or I might not.

I never bid on auctions on Ebay as most of the time, for the things I buy, there's a Buy It Now price that is cheaper.

Bob