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You already know that EBAY is the world's largest garage sale. It's a great place to find back-to-school bargains and a great way to earn income especially if you're in college, a retiree, or just want vacation money.

But do you know the best ways to save and make money on EBAY? This review shows you how in two parts: Finding Bargains and Making Money with an introduction on Individual vs Commercial Sellers. You may want to print this review rather than try to read it online: it's necessary very long because of all the tips I want to share with you.

INDIVIDUAL VS COMMERCIAL MEMBERS

This review discusses individual vs commercial members and how knowing which type you're dealing with changes your EBAY experiences. One is not better than the other. However, in general, your negotiations for concessions will more likely be successful with individuals. On the other hand, commercial members are more likely to treat your sales and purchases professionally, consistently, and efficiently.

The easiest way to distinguish one from the other is generally the number of transactions over time. A commercial member has a higher number of transactions but be sure and look at the time period for this number. For example, a member with 1000 transactions over ten years means an average of 100 transactions a year: an individual. On the other hand, a member with 1000 transaction in a month is likely a commercial member.

Another indicator is the number of types of items. If a member has a dozen auctions of the same item, he most likely bought the item wholesale and is selling it as a commercial retailer. Other clues are charging sales tax, being a Power Seller, and having a catalog website.

These are just general rules. Individuals can charge sales tax and commercial members can only sell one rare item at a time.

FINDING BARGAINS

Like me, your first experience with EBAY was likely buying something through auction. These tips will show you how to get the best value for your money when bidding.

Find the true price for the item you're bidding on.

The true price of an item is its bid price plus sales tax plus shipping and handling plus any miscellaneous fees such as insurance and money order fees. Many sellers (especially if they're individuals) charge no sales tax, no handling, and very low shipping and insurance. However, some sellers, especially commercial ones, like to pile on all kinds of charges so you may end up spending $15 or more for an item that you won for 99 cents at auction.

If these charges aren't explicitly stated in the listing, email the seller for info by clicking on Ask seller a question.

Make sure your item isn't on sale for cheaper elsewhere.

If you're bidding on a common item such as a current book or CD, make sure your item is not for sale at a cheaper price somewhere else. (Be sure and use the true price for comparison.) I find it funny that some auctions end with prices that are higher than retail, when the buyer could have bought the item discounted from somewhere else.

Easiest way to discover that is to type your item name into Google (www.google.com) and see if any of the hits list it on a shopping site or other auction site. Click on the site to check the price. If it doesn't show up in Google, try using the search engine of major shopping sites such as www.amazon.com or shopping.com.

Negotiate any miscellaneous charges.

With most individual sellers, no fees are set in stone. Most are willing to negotiate any charges such as shipping (for example, if you prefer cheaper charges on slower shipping). Commercial sellers are less likely to negotiate. It's best to email the seller before you bid, so you can base the decision to bid on what they eventually charge. However, don't be afraid to negotiate after you bid either.

Needless to say, you're more likely to get concessions with someone you've dealt with before. So, all things being equal, I prefer to buy from someone with whom I've bought or sold before.

Research the auction prices and rarity of collectibles.

If money is no object, you can skip this step. But for most of us, a budget constrains our collectible purchases. Even then, you're more likely to pay more for an item that shows up only once in a while then say, an item that's on sale every week. For example, I like to bid for Sears catalogs. Issues from the 1970s shows up fairly often, while those from the 1910s are extremely rare. I'll only buy the common issues if they're under $10, while for those from the teens get me bidding up to $100.

For most people, research involves only the Advanced Search option of EBAY: you enter the item name, select Search title and description, and enable Completed listings. This technique is useful for determining price and rarity of items sold only within the past month at most.

To discover sales from beyond the past month, use the Advanced Search feature of Google. Enter your item in quotes in the With All of the Words box. To find only completed prices, enter "ended" in the same box. In the Domain area below, enter "ebay.com" in the Only Return Results from the Site box. Then click the Google Search button.

Depending on the item, you're search results may span several previous months and will include listings, members, and other unnecessary hits. You can confine your research only to completed item listings, by only clicking on those results with a URL that begins cgi.ebay.com. If the listing for that item is not longer available on EBAY, click on Cached and Google will reveal its cached copy of the listing.

Offer to buy an unsold item from a previous closed auction

During your research, if you find your item unsold in a previously closed auction, email the seller and ask if he wants to sell the item to you. Sometimes, sellers don't want to go through the hassle of an auction and will accept your offer. Be sure and offer a price that's higher than the starting bid.

Check the seller's Feedback Score.

This little number is one way EBAY ensures that both buyers and sellers deal fairly. While the rating can be abused, I've found it a reliable way of judging EBAY aficionados. I only deal with sellers who have a 100% positive rating for 100 transactions or less. For more transactions, say 500 or 1000, I look for at least 95% or more, since it's hard to do a lot of transactions and not have some negative ratings. If necessary, I also look at the individual ratings within a member's profile to make sure the negative rating isn't based on something serious like fraud.

Negotiate an instant buy before the bidding begins.

If you want to avoid a war that bids up the prices of an item you want, email the seller directly and offer a price that is higher than the starting bid. Some sellers may accept your offer just to avoid the hassle of the auction. Be aware though that if your offer is accepted, your transaction falls outside the checks and balances of EBAY. While I've never had a problem doing this, neither buyer nor seller is protected by the site.

Ask the reserve price.

If an auction has a reserve price, save yourself time and frustration by asking the seller about the reserve price. Most will gladly tell you. If they're tight-lipped, I don't bother to bid. If the reserve price is higher than what you're willing to pay, there's no point in bidding. Otherwise, make sure your bid is higher than the reserve.

Bid at the last minute.

You don't want to tip your hand to other bidders by bidding early. Buyers are more likely to raise their bids if they know several people want an item. The more you catch other bidders by surprise, the more likely you are to get an item at a lower auction price. You can manually enter a bid at the last minute but this may fail due to poor timing or bad connections. A better method is to use one of the commercial bidding services (such as my favorite, www.esnipe.com) to bid for you at the last minute. For a low fee, they allow you to leisurely enter an item number, a bid amount, and how many seconds before the auction ends in which to place the bid. They then place any last-minute bids on your behalf automatically.

WARNING: Many sellers frown on this process of sniping. Be sure and read their listing terms carefully to make sure they won't invalidate any last minute bids.

Enter an odd number as your bid amount.

Never enter a round number as a bid amount. Most bidders enter round numbers and if two bidders have the same maximum amount, the earliest bidder wins. It's better to determine your maximum bid and then add a few dollars or cents to it (depending on the bid increment), so it isn't a round number. (For example, if you feel the item is worth $40, enter $41 or $43.) There's nothing more satisfying than winning item from your bitter rival by just a $1 or a few cents. (Conversely, there's nothing more frustrating than losing by a small amount.

Negotiate charges if you won several items from the same seller.

Presumably, you've already negotiate shipping charges as described in a previous step. But if you won several items from one seller, ask if he can combine all the items into one shipment to save on charges. You can even ask him to hold off shipping if you expect to buy several items from him within a week. Again, most individual sellers are likely to do this.

MAKING MONEY

If you need to sell something on EBAY, these tips can help you get the highest price for your item. I don't recall ever selling to a commercial buyer so these tips apply only to individual bidders.

Research the competition.

To avoid unrealistic price expectations, determine the fair value of your item by researching it as explained previously on Research the auction prices and rarity of collectibles. If you still cannot find pricing information, try contacting auction houses known for selling items similar to yours. Email them and ask if they've sold your item in the past and what it sold for. This at least gives you some idea of what to expect.

Describe your item thoroughly and accurately, including all flaws.

One reason for my 100% positive review is that my text descriptions magnify any and all flaws on my item. (If the flaws are serious, I describe ways to fix them.)

In my auctions of vintage wargames, I described every fold, tear, and smudge on the maps and the playing pieces. When the original dice was missing, I pointed out how easily replaced they were.
Buyers were then pleasantly surprised to find their purchase was much nicer or in much better condition than listed and said so in feedback.

Take good pictures.

If you don't want to spend money on expensive spotlights, take a picture of your item from several angles and under daylight. For example, when I sell model trolley cars, I take a side view, a front view, a back view, a top view, and a three-quarters view from one corner of the front. I take these pictures outdoors because the sun produces the best and most even lighting.

To avoid paying extra picture charges, I use Photoshop to combine those pictures into one, and upload the combined picture into EBAY. If you are proficient in HTML, you can store your pictures on an external site, and refer to those pictures in your HTML description.

Be sure and include a sense of scale with the item, such as a ruler, a dime, or even a hand. Sometimes size is the only external clue to a buyer whether an item is modern or antique. For example, if a turn-of-the-century Sears catalog is the size of a paperback, it's a reprint. Originals were the size of phone books.

Advertise your auction.

Don't rely solely on EBAY browsers to bid on your auction. Instead, advertise your item (with an appropriate link) in related newsgroups, websites, or even as a signature on all your emails. This is especially useful with collectible auctions, where many of my high bidders have come from other sites other than EBAY. The easiest way to find related sites is to put the title of your item into your favorite search engine and see what pops up. Don't forget to search in Groups and News as well.

When I sold brass HO models of Los Angeles trolleys by a Japanese manufacturer, I advertised in groups and sites for brass collectors, trolley buffs, Los Angeles, California history, train lovers in Japan, and of course, model railroaders. Most of my bidders came from these non-EBAY groups and one buyer had me ship his purchase all the way to Japan.

Contact bidders who've lost previous auctions of items similar to yours.

If your research reveals completed auctions of items similar to yours, click on the number of bids next to History. This reveals all the members who bid unsuccessfully on the item. Click on the Member ID and in the member profile page, click the Contact Member button. Then email the member information about and a link to your auction. I used this strategy when selling a complete multi-volume set of Arabian Nights by Richard Francis Burton and attracted many bidders who lost previous auctions of the set.

WARNING: This is technically against EBAY's rules and is considered spam. However, I have yet to receive one complaint about it in many years of using this strategy -- the folks I contact seem eager to bid on an item they just lost. See ladyconsumer's message in the comment section for some of the dangers of using this method.

Use a starting bid of 99 cents.

A low starting bid, especially without a reserve, generates excitement because buyers think they may get a bargain. You also save on the listing fee which is based on your starting price. I've never been disappointed with a 99-cent start and in fact, those items get more bidders and sell for higher prices than equivalent items with higher starting bids. If you go this route, be sure and advertise No Reserve or NR in your item title.

If you're nervous about losing money, add a reserve price but realize that many people (such as myself) reject items with a reserve price. One way around this is to prominently state in the description what the reserve price is. That way, bidders don't waste your time and their by bidding under that price.

Offer different payment and shipping options.

One way you and the buyer can save on charges is to be flexible with payment and shipping charges. For example, my book sales usually offer Priority Mail and Medial Mail as shipping options. However, my description also states that I'm open to other shipping options (some bidders have paid more for shipping than the cost of the book just to get it overnight.)

My standard payments options are PayPal or money order. However, I even accept personal checks from buyers with a 100% positive feedback, knowing they won't jeopardize that rating with a bad check.

Refund any shipping overages.

I usually add a little extra to shipping and handling to avoid losing money. Because I prominently state in my descriptions that I refund overages over a $1, I get almost no arguments from bidders. Needless to say, whenever possible, the refund check is included in the package I ship to the buyer.

Refunds are so uncommon that feedback mentions them with stellar applause.

This review is part of three_ster's Great Education Write-Off and hopefully helps new and old collegians to increase their cash flow.