Scores of businesses have been altered by the presense of auction sites.
How does one handle the eBay effect? You can:

A) Bask in eBay’s afterglow.
B) Hide from the Nuclear Rays, or
C) Let your own soul glow…?

Our company, Vibrant Technologies, buys and sells quality used servers, storage and networking hardware and we have observed the thick of the eBay effect. We’ve mostly chosen not to go with option A in that we don’t market very many products at auction. We also would be daft to ignore the effect that eBay has had on the marketplace, so we aren’t avoiding those nuclear rays, either.

Instead – you’ve got it – we’ve let our souls glow. No, I don’t (necessarily) mean like Eriq LaSalle did in 1988′s Coming to America. (I admit it though, I did write this post primarily so I could include the YouTube video.)

[youtube]ceankEaPBP8[/youtube]

What I do mean is that we’ve chosen to stand out, and take advantage of our strengths. We’ve realized that many of the basic services surrounding our products are often missing when you go to buy at auction, and we’ve built upon those.

1) Quality, tested and warranteed equipment.
Many items sold at auction are offered as-is without warranty – or DOA warranty at best. Vibrant offers at least a 30-day warranty on our equipment, so the client knows he is getting a quality product and that he has plenty of time to install and test it.

2) Easy Payment Options.
For many people, PayPal or even Credit Cards aren’t good options – especially on larger orders. We offer several payment methods; for corporate clients and established resellers, we offer net terms and the ability to send a PO as well.

3) Speedy Delivery.
Call us today and get it tomorrow. The process of buying something at auction can take days (or weeks) depending on how responsive (or unresponsive) the seller is.

4) Trust.
This has been our biggest trump card. We have successfully done business since 1998 specializing in basically one thing, used IT hardware. We have a great track record and the references to prove it.

Perhaps things will change again and we’ll explore models where we work more with eBay, but for now, we think we have a valuable product / service package to offer our clients. And it’s working well for us as we continue to grow. (And glow).

(This was the final installment of our eBay article series.)

You want to get full value for your excess IT hardware, right?

The following guidelines are useful whether you’re planning to sell “IT” on eBay, another auction site or to a remarketer for trade-in.

1) Test and Assess
Make sure you know exactly what you have. A slight change in the processor speed of a server, for example 900Mhz versus 1.2Ghz, could mean a difference of hundreds or even thousands of dollars in final value. Confirmation that your system is in good working condition can also reap you 2 to 10 times as much in value.

Test your system and if possible list a printout of your positive boot-up somewhere online or within the auction. Otherwise, offer a short warranty or guarantee against DOA to give the buyer the assurance that they are aquiring a working item. If you can also print out a configuration diag, this can be a great assurance as well. Most importantly though, don’t just assume you know your configuration based on an original bill of sale; check it out for yourself. System configurations are often upgraded from the original date of purchase.

2. Valuation
Setting a starting bid near what you want to get for it, but not for more than what similar items have sold for is a good idea. Don’t get what you want for it? Poll some resellers of that item that you’ll find from a Google search and see if you’re way out of the ballpark. Sometimes “buy-it-now” prices and online website prices are way above what the active market is trading at.

3. Use Keywords in Title
This is pretty straightforward but so many sellers don’t take advantage. I know that when I go to eBay that it’s definitely no fun to dig through hundreds of listings in a category, so I just go to the search option from the get-go. I would imagine that loads of other people do, too. Don’t spend too much real estate on the adjectives, go for lots of good hearty product nouns. They’re good for you.

4. Go Premium
I’m hesitant to ask people to spend more money for a listing, but when I’ve upgraded to a premium service such as listing in multiple categories, adding a subtitle or being featured in a category, I have to say, I’ve seen some pretty good results. I only do this for items that I really want to move out of inventory badly or on high dollar offerings.

So, good luck and if you don’t want to hassle with eBay or you’re not getting what you want, you can always give ol’ Vibrant a holler (or an email would work, too).

(Article 4 of 5 in our eBay article series.)

eBay can be a fantastic place to find great deals on IT Hardware in appropriate situations. We can’t deny that. In certain cases, even we have taken advantage of great deals on eBay – for an item we couldn’t pass up for our stock, or an obscure part we couldn’t find.

So first, I’ll list four situations in which eBay is a good move. I’ll follow it below with our seven tips for finding “IT” on eBay.

When eBay makes sense for IT
1) Low-end items: tranceivers, cables, internal connectors, etc…

2) Obscure items: your current used server vendor doesn’t have it, so maybe you’ll get lucky by searching the auctions.

3) Time: you have a lot of it. Sometimes eBay purchases can get really, really drawn out.

4) Comparison: you want to make sure you’re getting a good deal. If you need some type of comparison before buying from another vendor, this can give you some leverage. If the numbers are close (say 25%), you’re probably already getting a good deal from your vendor due to the value-adds. If it isn’t close, forward the link to your rep and it may help you get a better rate – or they’ll be able to explain what in the listing diverges from their offering (apples to oranges and all that).

Seven Tips to Finding “IT” on eBay
1) Communicate with the seller before the auction closes.
The “ask seller a question” button is your friend. It allows you to get answers to any questions that you might have about an item before you buy. Even if no burning questions come to mind, I still like to use this feature to make sure I’m dealing with a real person, and to gain some insight into how helpful of a seller they’ll be.

2) Check the freight cost.
Sure, a Sun E450 server looks like a great deal at $150 on eBay. But don’t get stuck buying it before you find out it is shipping from Australia and freight will be four times the purchase price. IT systems can be hefty, and accordingly, so can the freight. If there isn’t a flat fee listed or a way to calculate freight, then ask the seller for assistance.

3) Do a background check.
A surface level check can be done by looking at the number of previous sales and reading buyers’ feedback. I’m usually not comfortable unless I see at least 15 to 20 previous transactions with genuine feedback – not generically created. If the dollar amount is over $1000, I’ll look for a history of closer to 100 transactions or more.

4) Background Check 2.0: Go Deeper.
Trusting the seller is so important, that sometimes we have to look even further. If I don’t feel comfortable after examining the seller’s eBay history, then I might get a little bit more creative. I will contact them and ask them for some information about their business. If they happily submit information and give legitimate information to back it up (non-P.O. Box addresses, references, etc…) then I’m much more confident. Also, check to see if they mention their business in the listing and look it up on your favorite search engine.

5) Make comparisons off eBay.
Find something listed on eBay, but you’re not sure if it’s the best deal? Google it and you’ll find respected businesses (see Vibrant) that carry it. You’ll often find similar pricing, with warranties and customer service built-in that you wouldn’t get at auction.

6) Ask for a better deal.
Viewed an auction that didn’t sell? Ask the seller if they would lower their price for you and re-list it as a “buy-it-now” auction at your agreed upon price. You can also barter on shipping costs, or ask them to use your shipping account and not charge a fee. Some don’t go for it, but asking never hurts.

7) Buy-it-Now is not get-it-now.
Always check to make sure the lister still has the hardware, and what the lead time will be. I’ve found that sometimes companies or individuals post renewable listings, then forget about them. In the meantime, they’ve sold the item and no longer have it. If they do agree to fulfill the order, it can take weeks or months to receive the delivery – due to their need to source it. I used to think “Buy-it-now” was automatic, but now I always double check.

If you take heed of the above advice, and find yourself in the right circumstance, eBay buying experiences can save you money – as long as you’re willing to take the steps needed to safeguard the transaction.

(Article 3 of 5 in our eBay article series.)

To continue the discussion of how eBay is affecting the used IT Hardware marketplace, I’ve undertaken the following case study.

I performed a “title and description” search for the phrase: ws-c3524-xl-en, which is a very commonly traded Cisco Switch Feature. More precisely, it is a 24port 3500 Series Cisco Switch.

Here is the raw data:
————————————————————–

Search: ws-c3524-xl-en
Results: 39
Listings by professional network resellers: 7
eBay Buy-It-Now Range: $229 – $5500
Median Buy-It-Now Price: $349
Non-eBay Wholesale price: $325
End-User Used Price range: $350 – $400
Original Retail List Price: $2995

# of Sellers named “A Sauceful of Secrets”: 1
# of Sellers featuring a dancing “Taz” in their listing: 1

————————————————————–

Observations:

1) Used Cisco isn’t far off of eBay Cisco
Even at the low-end of the range (and keep in mind that is in Europe), you aren’t saving that much money to buy from an often unknown source. A used switch will be professionally cleaned and tested and come with a 90-day to a 1-year warranty.

2) Professional / traditional Cisco resellers are trying to leverage eBay
While there are professional resellers listing here, they don’t stand out because their prices are so middle of the road. One company isn’t even close, posting at almost 20 times the median price! Perhaps professional Cisco remarketers would do well to better promote their quality advantages in listings to gain an edge. I’m sure many buyers want to make sure they are buying legitimate, quality hardware.

3) eBay Amusement = Distrust?
There’s probably a time and place for spastic Taz icons and names like “A Sauceful of Secrets” as amusing selling advantages, but it starts to look unprofessional when you’re slinging high-end networking gear.

I give Taz a thumbs down for being overly cheesy and the word “secrets” in a used Cisco switch sale makes me a bit weary with all of the counterfeit junk flying around. Ancient Cisco plant secret, huh?

(Article 2 of 5 in our eBay article series.)

Everybody from the press to your aunt (who just made some serious bank on her antique teacups) seems to have a place in their hearts for eBay. But for those in the following five industries, eBay has caused a bit of stress for those who have failed to adapt to its influence.

1) Computer / Server Hardware
It was 4:00 PM on a Thursday afternoon and it had been a long week. One of my best clients called in regarding a Cisco Switch I had quoted him earlier that month… “I really want to pick this up from you, but my manager searched this on eBay and found it for 10% cheaper. Can you come down a little?”

Luckily, we sell used Cisco and typically have comparable pricing to eBay. If we were a manufacturer or a new reseller, our price probably would have been off by 50% or more!

Manufacturers, resellers and remarketers have all faced price pressure from our clients who compare us to eBay. The fact is, you’ll (almost) always receive enhanced assurance and added value by working with a reseller and forming a long-standing partnership. Nonetheless, it has become imperative that IT Hardware resellers take extra measures to add services, resources and trust.

Back to the example above. My client forwarded me the auction listing for the used Cisco switch. It turned out that it didn’t include power cords and slot-covers and it was offered “as-is” without any warranty…

We got the order Friday morning.

2) Jewelry Industry
Sell an old diamond ring to a storefront jeweler, and you’re bound to get much less than you could reap in an online auction. On the flipside, the jeweler is losing a sale to the person who purchased the used gem. While there are concerns about authenticity and the fact that many like to see a diamond or other jewel in person before purchasing, eBay often still wins out.

Take the following snippet by an online jeweler directly from an eBay review page:

“There was a time when consumers went to what they thought was the ‘source’ (the New York Diamond District) for their diamond purchases, however, over the years, those who want to keep up with the competition (in New York) have actually opened eBay stores and conduct auction events in order to move their merchandise quickly (especially during non holiday seasons).”

Many jewelers have adapted by creating their own eBay stores and others instead decided to focus on the high-end of the market and market their expertise and prestige.

3) Flea Markets
The Flea Market circuit has had to feel the pain of the online marketplace. How would you feel about sitting in the rain, trying to sell vintage road signs and painted hubcaps when you know you could just list them online instead?

I think the flea market is enough of an event to retain most faithful shoppers, but many of those visitors check eBay pricing from home before they head out. Thus, not even the flea market tables can escape the price pressures of eBay.

4) Coin Dealers
Before 1995, there were millions of coin collectors, but only a handful of true coin dealers throughout the world. When eBay came around, the industry was turned on its head.

Individuals are buying coins at online auctions with little education in the process. Some coins might be listed at ridiculous prices online, making them terrible investments. Collectors have reported that lower-priced coins tend to sell for more than they’re worth, while higher price coins lose their value as the miseducated masses become coin “dealers.”

Those coin dealers who have become relentless online marketers have built quite a strong tool to market their products outside of their local shops and road shows. eBay is a huge marketplace for them to draw in buyers to their inventories.

5) Professional eBay Sellers
Ironically, many of those who initially gained so much selling at eBay auctions were unable to adapt to increased competition, changing markets and increased listing fees – and ended up having to go back to their traditional jobs.

In a Salon.com essay, Doomed by eBay, Claudia O’Keefe recounts her success, then eventual failure as an eBay seller.

“It was a beautiful dream, but a stupendously arrogant one on my part. I fell under the giddy, deep drink of individual Internet commerce, and it has to stop.”

In the end, even the everyday auction sellers have felt the eBay effect.
———-

Truth be told, the open marketplace is terrific for the consumer. But most of these markets have felt great pains because they end up essentially being the middleman. However, the leaders in these industries have either learned to adapt to the new marketplace, or have built up added value and assurance to their products.

Later this week, we’ll discuss what Vibrant is doing to add value for our clients and become a leading reseller of servers, storage and networking in the eBay era.

(Article 1 of 5 in our eBay article series)

eBay has changed the remarketed server industry and it can’t be ignored. We certainly haven’t ignored it from a business perspective – we’ve actually decided to embrace it, and cover it here on our blog.

While eBay has been a terrific way for many people to make money off of their old Star Wars figures and Teddy Ruxpins, it has also changed the way markets like the used server/storage/networking industry operate. Many server resellers would prefer to ignore how eBay has changed our marketplace. Whether it’s acknowledged or not, the fact is, we have all had to adjust to it in one way or another.

Here are some of the topics we’ll cover in the coming days:
* Five markets altered by eBay
* Case study of used IT hardware on eBay
* How to buy IT equipment on eBay
* When and how to sell IT hardware on eBay
* How we’ve adjusted to the eBay effect