Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Microcap & Penny Stocks : Bid.com International (BIDS) -- Ignore unavailable to you. Want to Upgrade?

To: donkeyman who wrote (28572)	4/29/1999 1:14:00 PM
From: Cameron	Read Replies (1) \| Respond to of 37507

I didn't get a chance to watch the USA auction but I was tuned in for the majority of the Canadian one last night. I don't know how comparable they were but from a financial point of view, I think that the Canadian one highlights the potential for the dutch auction system from a purely financial point of view. The following are a couple observations. 1) I only had a strong sense of the wholesale cost on 3 items which were auctioned. On these 3 items, bid.com earned gross margins of 25%, 56% and 100% respectively. I don't know what they would have brought in a regular auction but these figures clearly exceed their normal GP significantly (ie. by a factor of 5 on average). This is BIG... BIG.... BIG...... 2) It was interesting to see how they set their pricing. Basically, they set their opening price at the suggested retail price and their bottom price at the wholesale cost.... as the clock ticked the prices came down. This methodology is appealing to consumers in that they should be able to get a price below what they would pay full retail (although there was one laptop that sold almost instantly so not much savings). It also guarantees a positive gross margin for the company. Basically, every item has a reserve bid equivalent to the wholesale cost. I thought it was very interesting to watch. Definitely a win-win for both consumers and bid.com.