Your Auction Business & Taxes

by V. Raposo

Taxes is an issue when running an Auction Business. But is there a grey line when it comes to declaring it? It's really within reason if you're going to do a huge amount of it, a small amount is negligible. Some people want to have a small business for write-offs, you might want to consider taking it to the next level and be able to write off some of your expenses like your computer, office space, supplies, etc. Each state and each province has their own amount of sales you can do without declaring, & charging taxes. Check with your state to see what amount you have to do before you start taking taxes. The BC goverment (where I live) gives you an allowance of $30,000 before you have to charge for sales tax, that's for someone who legally has a business. There's definate advantages of having a business license, declaring your income and being able to have write-offs. That being said, legally you have to declare taxes if you're profiting from it. Are You Holding Onto Too Much Product? We all love to make money but after a while when you get too much product built up, you can start losing money. Why would we do that? What happens is we get in a mindset on the value we feel our items are worth verses, what we can get for them. That's why when purchasing items it's important to keep in mind that you make money when you buy, Not - When you Sell. But we also get into the territory where you feel you should get a certain price for something. And that's what we need to shake.... immediately. You need to be watching your products and if something isn't pulling in the money anymore, you need to blow it out. Product on the shelves is not money in your pocket.... it's out of your pocket. When we relate this to your eBay business, the same goes for what you have in your eBay store. Keep it fresh and alive. Have special offers, only for those who are buying an auction AND a store item. Make it something that they want and give them a deal. Blowout product that you've had for too long. This will give you money up right away and gets you product you can actually do well with. So, get out of the mind frame that to you need to make "X" amount from certain products, if they're not pulling it in, then "X" them out and move onto newer hotter products! About the author: Vera Raposo has been making a living with online auctions since 1997. With thousands of completed auctions under her belt, Vera is now sharing some of her best auction strategies in a free 90-minute interview at http://www.auctionstrategists.com/special

Professional Buyer's Use of Reverse Auctions

by Doug Luthringer

Some professional buyers are still wondering why they should take advantage of reverse auction technology. It is true that some items are not good to reverse auction, but some are very good opportunities for reverse auction. This article will give a brief look into the top five buyer rewards for using reverse auctions and how the buyer and their company can be more successful. First and foremost, reverse auctions are used to get the best available market price at the time of the bid. In many instances, a reverse auction will result in a lower price paid than traditional sealed bids or negotiations. While savings are sometimes difficult to accurately measure, and while some costs are "hidden" (supplier change costs, set up charges, etc), companies employing this technology in properly conducted reverse auctions are experiencing often 10% or more real cost savings. Whether you use the last actual price paid or bid price reduction, you can accurately track, report and post the results to all interested parties within minutes after the event is complete. This leads us into the next buyer reward which is process improvement. It is true that it may take more time to put together a reverse auction bid, but this preparation brings about a disciplined, thorough, and fair bid process and ultimately better supplier selection decisions. Reverse auctions require special care be taken to write accurate specifications and evaluate the true historical spend information which enable you to better forecast your demand to potential vendors. This process discipline will improve your productivity for future competitive bids because you will have quick access to the information in the future. Reverse auctions reduce the negotiation time from weeks to minutes. The cycle time is shortened which, in turn, will reduce costs and improve efficiency for both buyer and seller. In addition, you will be able to easily duplicate the bid package if you would like to run similar reverse auction events in the future. Another reward for buyers is bid transparency. Reverse auctions can be used as a transparent reporting tool for all bids accepted. This works especially well in the public sector where every penny is tracked and monitored. Online bidding systems can usually save all data for quick report generation at the click of a mouse. If needed, the live event can be viewed in real time by any interested parties from any internet connection or on a viewing screen in a conference room. Most reverse auction systems are web-based, allowing interested parties to log into the system and watch the event live from their desktops. The next buyer reward is increased organizational competitiveness. When you reduce costs and improve productivity, you make your company more competitive and therefore more able to attract and retain customers who seek price reductions. Streamlining your procurement process through online competitive bidding methods, such as reverse auctions and eRFX, will benefit your organization and your career. When you can show measurable results and easily report those results to management, both you and the organization will benefit. The last buyer reward for using reverse auctions that we will talk about today is extending your reach to new potential suppliers. When you use online reverse auctions, you can post the bid opportunity on your website which will attract more suppliers to compete for your business. You still must pre-qualify the suppliers, but the increased number of suppliers will increase the competition for your purchase, driving down bid prices. You can easily include more bidders via the streamlined e-procurement process. If you wish to open up your purchase to more can be difficult to identify new suppliers to create a competitive environment for a reverse auction. By posting your events online in a public format, more suppliers will be able to find you. Finally, you should treat reverse auctions as one tool in your procurement toolbox. Most organizations that currently do competitive bidding will be able to see the value of the reverse auction process and to recognize how it fits into their organization. And those organizations are saving time and money by doing them right. So don't miss the opportunity to connect and contract quickly with your suppliers by using reverse auctions. About the author: Doug Luthringer is a Client Development Manager at eDynaQuote (http://www.eDynaQuote.com) with over two years of strategy, implementation and training experience in online reverse auctions and over six years with online forward auctions such as eBay. Doug has also been invited to be a guest speaker to talk about how to properly use reverse auctions to small and medium size business, as well as university students.

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