Auction Terminology Common Terms

Auction?
An auction is a public sale in which the price is determined by bidding, and the item is sold to the highest bidder. To participate in an auction means to bid to obtain an item. The person who offers the highest bid wins the right to purchase the item at that price.

Bid
A bid is the offer of a specific amount of money on an item for sale. The bidder competes with other potential buyers, keeping in mind that the buyer with the highest bid is obliged to complete the purchase with the seller. Hence, a bid is the price you, the bidder, are willing to pay for an item up for auction.

Win
The person with the high bid is the winner of the auction. If you win an auction by placing the winning bid, you can then purchase the item at your winning bid amount.


Automatic Bid
It allows you to decide the maximum amount you are willing to pay for an item. This way, your bids will be automatically increased by our software to the next acceptable bid increment should someone outbid your initial bid. Also, the Automatic Bid always wins in the event that someone ties your maximum acceptable bid!

Reserve price
It is the minimum price that you, the seller, is willing to accept for the item. This amount is set by you before the auction starts, and is never disclosed.


Start price
It is the starting bid of the auction. The starting bid price is normally set 10% to 20% below the reserve price in order to encourage bidding. If you do not wish to have a reserve price, then the start price is the minimum price you will accept for an item.


Bid increment
It is the amount by which each bid increases. You, the seller, sets this amount. We recommend that if the reserve price (the minimum amount you are willing to accept for your item) is high, the bid increments should be large, and vice versa.

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