BUYING FROM AUCTIONS AND RESELLING
All successful businesses are based on the simple principle -
buy something cheap - then sell it at a mark up. Simple, in
theory - but rarely simple in practice. One of the major
entrepreneurs 'headaches' can be where to get goods to sell
at a cheap enough price to allow a large enough profit.
Fortunately, there is a way that problem can be solved -
easily. Quite simply, auctions offer you the chance to buy
all sorts of goods at under market value. It's then a simple
matter to resell them, perhaps immediately, at in excess of
market value. A clear, quick profit!
Auction buying is not just an aid to those already in
business. There are many cases of people who do nothing but
buy 'anything' at auction and resell for a profit. Just
consider, it only needs a few items bought/sold a week with a
few hundred dollars mark up on each to build a considerable
income. You can be an auction entrepreneur in just part time
hours.
Of course, auctions are still shrouded in some mystery.
That's what helps to keep the undetermined away from the
profits. But, they are generally simpler to follow than they
were. With a few visits you can be quite experienced at
'snapping up' bargains at auction and reselling for an
immediate gain.
Really, it matters not what you buy. Just consider an
auction as a place where you can get things for a lot less
than they are worth. That's nothing short of an instant
money making opportunity!
Sheer Potential
The great thing about auction trading is that you can
actually prove the potential to yourself before actually
spending anything. Just go along to a few local auctions.
Auctions are mainly a quick way of selling goods for vendors.
And, they are also a way of selling things where any other
techniques e.g. press advertising would be difficult.
Because of this the prices are invariably far less than
market price. Auctions are rarely an attempt to get more for
an item than it is really worth, despite appearances to the
contrary. But, of course, you would always guard against
being over charged.
Discounts at auction vary according to the type of goods
sold, type of auction, type and number of crowd - even things
like the weather. In some cases auction discounts have been
quantified at as much as 80%! Rarely would the saving fall
below 10% - but a reasonable ready accessible saving would be
20-30%.
Quite simply, the auction potential means you might buy an
item (say a car) at $2,000 one day. Then, the next day sell
it for at least $2,400 to $2,600. That's a considerable,
instant profit for hardly any word - a way of making very
quick extra cash.
How to find an Auction
Auctions are held the length and breadth of the country
almost every day of the week. So, there will always be a
chance to make money. It's not always obvious which are the
best to attend though, and this will need some market
research on your part.
There are directories available listing auctions and
auctioneers. But, the cheapest way of finding them is to
look in the Yellow Pages at your local library. Check the
index to see what different categories 'auctions' might fall
into.
It is wise to visit auctions before you even consider buying.
Because, although they offer the same service they do work on
different principles. Check, by observation, that the
auction is fair. Auctions are, of course, working to get
highest prices for sellers - but they should not be biased.
Good auctions should display goods prior to the sale for
inspection. And, they should issue a catalogue or list of
what is on offer. The buyer accommodation should offer a
clear view of the auctioneer during bidding. More
importantly, the rules of the particular event should be
displayed on site - and followed by staff at all times.
Do ensure the auction you attend is fair to all buyers, and
not favoring the 'regulars'. Also that the price is not
artificially inflated by the auctioneer - it should be the
demand that sets the price. Most auctions are honourable
organisations, but there could be exceptions!
Do stay behind after an auction has finished. This gives a
chance to see if those who have bought are pleased with their
purchases - or if any 'little disputes' arise. A good guide
to finding the best, most honest and most profitable
auctions.
Successful Buying at Auctions
When you have gained a little experience at auction you can
venture to make your first deal. And, there's no reason why
it should not be very profitable.
Do remember that most auctions demand cash on sale. So, take
an appropriate amount with you. If this is risky ask for a
bankers draft at your bank. This is really a check that
cannot be stopped and most auctions will take them.
At auction, goods are sold in lots. So, you will need to
decide which interests you. It is a good idea to select
'substitutes' in case your choices are bought by someone
else.
To start bidding, the auctioneer will normally set a price.
This could be far too high - or far too low. So, wait until
a few bids have followed. You can then decide whether the
price will allow you sufficient sale margin and start your
own bidding. Each bid may rise in $1, $10, $100 or larger
units. So you have to keep a check on the total carefully.
There is a good deal of showmanship involved in auctioneering
and you'll certainly need all your wits about you. Perhaps
the main aim is to ensure you only buy at good low prices.
Fall out of bidding if the price is getting too high.
Although experienced bidders may make strange signals to the
auctioneer there is nothing wrong with making your bid quite
clear. You can pick up the 'tricks' that others use in the
future.
When the bidding slows and the appropriate sum is reached the
auctioneer will proclaim the classic 'going, going, gone'!
When the hammer falls the item is sold at the final price.
Most auctions will demand a cash deposit at the fall of the
hammer. The only exception being if they require all bidders
to register and lodge a deposit before the auction. The
balance must be paid and your purchase removed within a
certain time limit.
Note that auctions operate on a 'sold as seen' basis and
rarely give refunds. Only a few give a guarantee against
faulty goods. So, bid enthusiastically, but with care taking
professional guidance as appropriate.
For best results you should arrange to process and resell
your purchase immediately. Don't sell at auction though -
the profits won't be enough. Best profits are perhaps to be
found through newspaper advertisements.
Then - when you've cashed your purchase in and made your
profit why not reinvest the proceeds in an even bigger
auction deal?
Some possibilities
Following you will find a list of the proven opportunities
auctions offer:
- Cars. One of the biggest auction money makers - huge
discounts. But, do buy carefully as you have little
protection against faulty cars, although most auctions have
warranties against stolen cars. Follow all vehicle
regulations - a car dealing licence may be needed in some
areas.
- Household effects. Ideal place to start in auctions,
buying up household items. Often valuable items can be
bought for pennies on the dollar in 'product lots'. Sometimes changes to pick up
antiques.
- Stock. Bankrupt trade stock, discounted lines, etc. are
frequently sold off by auction. There are good opportunities
here to buy up lines and then offer to traders or sell via
market stalls etc.
- Tools/Plant. Items from the trade are frequently sold off
by auction. This may include new and used items which can be
bought up and then sold back to the trade. Do check items
offered as, with many other auctionites, it may be up to the
bidder to check whether they are working or not.
- Farm Stock. Another popular auction line. But it is
probably not suitable unless you have some experience in this
area.
- Property. A real potential winner with huge discounts
available on property of all types. Do take legal advice,
and advice from a surveyor/valuer though.
- Art and Antiques. Offers profits to beat them all. Needs
a little study of the business - but there are smaller
markets you can try and succeed in. Not all auctions sell
'old masters' for millionaires only
Always remember of course that auctions do not always fall
neatly into categories. Some may be a combination of several
types - or completely new auction lines. Just keep your eye
out for any auction - because it's almost always a chance to
enjoy huge price cuts!
Auction Success
Auctions are a unique opportunity in a way. Because, unlike
other ventures you can't guarantee a certain trade week in
and week out. Remember though, this means your income is
limited by virtually nothing!
It does not matter how little you know about auctions - or
what you buy. Simply consider them as a way of getting
attractive merchandise at very low prices indeed. A source
only open to the most enterprising of people.
'Buy cheap, sell dear' is a principle that means nothing less
than complete success. Exploit that principle and let
auctions make money for you.
