There has been quite a few penny auctions that have popped up online. Sites like Beezid, Bidfun, and Quibids are just a few of the sites. They advertise picking up items at a fraction of the cost. It sounds so alluring but as they say, the devil is in the details. And in this case the truth is right at the door. When you sign in the first thing you will need to do is purchase bids. When you go to purchase notice how much you paying for the number of bids you are getting. I have used Quibids and the cost last time I was on there was 60 cents for one bid. In other words you are spending 60 cents to buy a penny to bid with. You are probably saying that is a bit much. These sites wouldn’t make it if they were giving this stuff away for penny’s on the dollar like they claim you are buying it for.
Here is how this really works. So going with the price you pay for a bid at 60 cents, consider the iPad they show in the commercial that someone wins for $21.92. Your basic iPad 2 with 16GB of memory is costing about $340 as I saw this past Christmas at a store. In order to look at how much was actually paid for that iPad we need to take the $21.92 and convert it to the true amount that was spent. We know that $21.92 is 2,192 pennies and that is the number of bids made. Now take 2,192 times 60 cents and the total is $1,315.20. You see how it works. The company bought the iPad, if they paid full retail for $340 and collect $1,315.20 through the bids that were placed. The made almost 4 times that amount they spent. Now not all of the bids cost 60 cents. There are bid vouchers you can win. Also, some of the products you can bid on come with so many free bids, too. But be not deceived, they are making money.
So now the big question is, how I can make this work to my advantage. First, don’t think you can squirt the system. You can win items and only pay a few bucks for them, but the real big items are hard to come by. I have won several items where I maybe paid a total of $10-15 for them with the shipping, but most of those items were won in the late or early morning hours. I won a Ginsu Knife set with block for our kitchen and total after the bids and shipping was $12.46. They said the retail price of it was $129.95 so I would say I did pretty well. There are a couple of other items I have won,too, for small amounts. But don’t get hooked thinking you can make it big by doing this. It can become addictive just like gambling with all the same pitfalls.
One more thing, many of these sites have an option where if you are not the winner you can pay the difference of your bids at original value subtracted from the MSRP (Manufacturer Suggested Retail Price). For example, your bids are 60 cents and let’s say you place 20 bids, equivalent to $12 dollars. The item’s MRSP is $35, so you can pay $23 plus shipping to get the item. Again, the MSRP is a higher price, usually, than you would pay at Walmart or Target, so it still works in their benefit. If you see an item you want to bid on, check out what it would cost to purchase it online or at the store. Then look at what they have it priced on the site and make a more informed decision if you want to try for it. If you are willing to spend money to take a chance at being that one lucky bidder, than good luck.