With the introduction of the new Penny Auctions, there have been speculations and critical reviews that made some think that’s it’s a faulty way of doing business and others thought its beneficial so lets give it a try. The truth is that the bidding websites have their benefits and risks.
We would enumerate some benefits and risks for Penny auctions that have manifested the thoughts of the public.
Benefits:
· There is a minimal fee that is charged for these auctions. These charges filter out competition to the buyers who are serious enough to bid for the product.
· Online auctions provide convenience to the customers that they can shop online and they don’t have to worry about the traffic or the crowds in the mall.
Risks:
· The name can be a bit deceiving. The name Online Penny Auctions might sound like a dollar store which it is not. So we have to get our stats straight. Penny auctions seem like its cheap and the stuff that is being sold is being sold for peanuts so people might jump in thinking that it’s a good deal. Who wouldn’t? Despite how it sounds, the mechanism has to be studied.
· The next risk is the miscalculation of the cost. On penny auctions every bid cost a minimal amount say $0.50, so every bid you are posting is costing you 50 cents. The total end price of the product must be added with these costs and that’s how much you got the product for.
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