Can You Win Using BIN?

Can you win using the Buy-It-Now option on DealDash.com?

Answer: No, but you can prevent yourself from being a loser by using BIN. That’s right. If you do the math, and you figure out at what point, you would be better off using BIN, then you will at least break even.

Let’s say you bought all your bids on sale for 15 cents each and you are bidding on a $50 gift card. At what point would you be over-bidding? It’s important to know this information ahead of time. If you continue to bid above and beyond the value of the auction, you have reached the point where you will lose even if you win, but how would you figure that out?

First, you would divide .15 (cost of each bid) into $50.00. You will come up with about 333. That’s a good starting point. But you must also remember to consider the closing cost of the auction. To learn the total cost of winning an auction, you must add the cost of the bids used, plus the closing cost of the auction. You do not want the total cost to be more than the retail value of the auction.

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For example:

  • On a “Free-to-the-winner” special feature, you can place all 333 bids before going over the total value of the auction because there is no cost to the winner. At that point, however, you are better off using BIN to purchase the card and get all your bids back free because placing any bids beyond that would put you over the full value of the $50 gift card.
  • On a “50-percent-off” special feature, let’s say the auction closes at $40. That means you will have to pay $20 (half) of the $40. Now you would take $50 (value of the gift card) minus $20 (final closing cost to you) and get $30. Then you divide .15 (cost of each bid) into $30. Therefore, you would learn that you do not want to use more than 200 bids in the auction or you would be over-bidding. If the bid is up to that amount and you have already used 200 bids, you are better off doing a BIN.

Remember, one thing worse than losing an auction is by over-bidding the total value of the auction and becoming a losing winner.

Submitted by: Barbara L. Sellers

 

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