The difference between the ebay scenario and H&S scenario is everyone is NOT playing under the same rules!
In the ebay scenario, we are all playing under the same rules - no buyers premium!
When H&S places a bid in their auctions (as HOC) and does NOT have to pay the buyers premium they are at an advantage over the other bidders. When you make a bid in an auction, you like to believe that the other bidders are making the same considerations as you: bid amount, buyers premium, any other fees - essentially, do I feel comfortable at this TOTAL price. When HOC makes bids they do not have to consider these other variables: H&S $200 bid = $200, other bidder $200 bid = $239 (with buyers premium) - those are not the same amounts; therefore, thats an advantage!
When H&S increases the bid amount, they directly increase the buyers premium; therefore, directly increase their profits - even if they dont win the item. Its a conflict of interest.
In the ebay situation, the seller (with the new user ID) can make a bid and increase the amount. The other bidders are playing under the same rules: seller $200 bid = $200, other bidder $200 bid = $200 - same amounts, no advantage gained. The seller does have a conflict of interest in this case because he likely is charging the individual who consigned the item a fee (higher it sells for - higher fee amount); however, in this case, the seller is taking more money from the consigner - NOT the other bidders.
I see numerous people spinning this a variety of different ways and using different comparisons, but this is a conflict of interest. Any auction company that bids on its own items should have it clearly listed right under the buyers premium - "we bid on our own things and dont have to pay buyers premiums!"
An.dy Ke.nn.edy
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02-22-2012, 08:07 AM
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