By Jeff Clerk

You’ll notice a lot of individuals out there composing articles about penny auction sites, there advantages and disadvantages and certain articles claim that they are scams. To that point I’m writing to share with you some information with visitors that points out what you should take notice of must you participate in penny auctions.

Additionally I would like to mention that just like various other opportunity out there, there are good internet websites that really make a positive change and, admittedly, there are some site owners that find a way to give everybody else a bad reputation. You will need to make that decision by yourself. However, I can let you know there are several very good and honest sites online that will help save you a great deal of money on items that you want. You just need to find appropriate ones. With that said, I do want to show you about things that you should watch for in a dishonest website.

First of all when you find a new penny auction site, take a look at the prior auctions that have shut on the website. Especially observe the winners. You may notice the same individuals winning auctions most of the time, especially if the listings they constantly win are larger listings. This could be a sign that the auction holder has something unethical taking place backstage. Remember auction computer systems are computer programs and can be programmed to make sure that they generate enough money to cover the cost of something before they let the item sell. This is actually a way of “shill bidding” where the auction owner has someone or simply the program itself putting in a bid the item facing the shoppers until they make enough cash to cover the things and their cost. This may cost the customers something on the pay-per-bid sites due to the fact that each time they have placed a proposal it costs the consumer 60 cents or more. Therefore the auction master makes the money at 60 cents on every bid and doesn’t have to supply the merchandise since he was in fact the winner. This really is a con and by law it is regarded as racketeering.

Another option to choose this kind of action can be to figure out at what point the price of an item is paid for and then watch several auctions to see if they just get over and above this figure and then end. I will present you with an example. Say you actually are involved with an auction sale for a one hundred dollar store card and every auction bid takes the price up 1 cent. However, each bid cost the customer sixty cents to buy it. In order for the auction manager to break even he will need the price to reach $1.67.

Here is how you are able to learn this price point for each auction that you are participating in. Have the cost of the item and divide it by the cost of a bid. In this example it’s one hundred divided by .60 that equals approximately 167 bids to generate the one hundred needed to pay for the price of the item.

At this point the cost of this item has already been included in the bids placed. But, that is only if real customers are bidding against each other for a particular item. If there is a piece of software or individuals paid by the auction house bidding against just one customer, you, they’ll likely need to get 2 times that. So the public sale will likely not end till it reaches above $3.34 to cover the cost. Now $3.34 seems like an outstanding final price for the item, however be aware if you are in a bidding struggle with a bot and the item is won at $3.34 you have invested 60 cents times 167 bids or one hundred plus the final auction value of $3.34 for the hundred dollar store card. You actually didn’t save any cash at all.

Never assume all systems use this type of auction, nevertheless there are some unethical ones out there that do. That will be why I love seat based auctions because I am certain what my costs are going to be in advance.

Read my alternative useful resources about penny auctions to discover more on the sites, also take a look at http://www.pennyheavenonline.com for a legitimate chance to win an auction on a seat based site. Happy Bidding