A recent auction on eBay discussion on Joe's Chat Board elicted some worth deliberating upon in greater depth. The question is whether to stop an auction when you receive a high enough offer, or whether it is in your best interest to let the auction run its course. It is a problem that has financial and ethical components, and one on which I have definite opinions.
The auction in question had two extremely rare and valuable boxed lures, including a beautiful Rhodes Minnow lure and box and a black Shakespeare Evolution box. The auction was ended early for reasons that are unknown, but it does not take a brain surgeon to figure out that the seller received an offer high enough for them to simply pull the auction and sell it off eBay. This happens dozens of times a month in the antique tackle category and probably hundreds of times in total every day in all the categories on eBay.
From a financial standpoint, we will never know if this was a wise decision or not as we are not privvy to the offer. However, having sold over 3000+ auctions on eBay back in my days as a bibliophile, I have lots of experience taking offers on very rare books from eBay bidders. I never once stopped an auction early. Almost without exception, although many of the offers I received were generous, the final auction price exceeded the off-eBay offer. Taking into account eBay and PayPal fees and federal, state, and local taxes, I would surmise that in 90% or more of cases it was worth it financially to simply ride out the auction.
I will cite two personal cases. Around 2000, I offered a very rare late printing of an A.A. Big Book. I knew it was worth a lot but was unsure of how much--no on-line bookstore had a similar edition for sale. Within twelve hours, I received an offer of $250 to end the auction. Then $350. Then a guy called me on the telephone to offer me $500. I thanked him for his interest, and then told him I would not end the auction early. He proceeded to tell me he would not bid on the auction, and that the only offer he would make was the one on the table and I had to take it or leave it right now. The bidding stood at around $30 with about five days left. The temptation was tremendous to take the money and run. But I told him the auction would run its course, and then hoped that I would not regret it. I watched as the auction inched up as the time ticked by; with an hour left it was at around $75. But then the bidding went crazy and the book ended at around $800. So I made a good decision.
Another time, I was selling a very fine copy of an old book on California gold mining, another edition not found in any on-line bookstores so the value was impossible to calculate. I knew it was worth something but did not know when. I listed it and got offers within two or three hours for $100. I then had one gentleman offer me $200. I told him no. Then he offered $300. I told him no again. Finally, he offered $500 and a very detailed reason why I should sell him this book. I still said no. The auction ended at something around $350, and to the gentleman who had made the $500 offer to boot. So on this one I lost money.
All of this gets to the ethics of the problem. Is it ethical to end an auction early? Technically, from an eBay point of view, I believe it is against the rules to do so as it circumvents eBay's fee structure. From an ethics standpoint, I believe it to be unethical to end an auction early.
My stance on this, of course, will not change anything. People will always end auctions early in an effort to make more money and avoid paying eBay fees. I think they are making a mistake. I believe that the great majority of the time, people would make more money by letting auctions run to fruition than ending it early.
Unless the owner of those lures in the eBay auction made five figures or more from their offer, they left a lot of cash on the table in their effort to sell these lures early and avoid a hundred bucks in eBay fees.
-- Dr. Todd from Milwaukee, Wisconsin
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