Auction vs Buy it Now
Before selling any item, the seller has to make a choice. Do they want to liquidate the item as soon as possible or do they want to hold to maximize profit?
Option 1: Liquidate as fast as possible (Auction)
NOTE: Assume that at the end of the auction, the buyer actually pays. eBay doesn't do a good job at requiring buyers to actually pay but it is what it is...
If a seller decides to liquidate the item as soon as possible, they would place the item up for auction. For this example, let's say that that auction is set for 7 days. This means that the buyer is guaranteed to be paid at the end of the auction. Here are the PROS/CONS of this:
PROS
You are guaranteed to get your money at the end of the auction. This means that you don't have to wait around for an "X" amount of time to get it.
CONS
Interested buyers may not have time to react to the auction if it's set to sell within 7 days. For example, if a potential buyer decides to start collecting your item but chooses to do so after your auction ends, then you missed your chance to offer your item to that person which may have resulted in a higher bid.
If the item isn't doing well at making impressions, the listing is prone to eBay sniping. This goes back to not reaching collectors who simply are not looking for your particular item at that current period of time.
Option 2: Maximize profit (Buy Now)
If a seller doesn't have financial restrictions that would be forcing a fast sale, they may choose to list the item at market price (eBay's Terapeak sales tool is really good for this). This means the buyer could wait weeks, months or even years before selling the item at an optimal price. Here are the PROS/CONS of this:
PROS:
The seller has a potential to maximize their potential profit on the item.
The seller has a longer time attracting potential buyers over a larger span of time.
The seller has an opportunity to reach to sudden market changes. As an example, if I had a PSA 7 Base Set Charizard listed well above current Market Vale (currently between $275 - $335 USD) and the "COVID Pokemon Boom" happens overnight, my card has now automatically adjusted without any seller input.
CONS:
The seller needs to be educated in previous sales data and not current listing prices. Often times, sellers won't take this into account.
The seller put too much capital into the item and is trying to make up for it with a higher listing price. This may result in your items being extremely overpriced and deter potential customers.
Option 3: Maximize profit w/ built-in market monitoring (Buy Now w/ OBO)
Personally, I believe this option to be the best since it takes traits from both option 1 and option 2. At the end of the day, a sale occurs when both the buyer and the seller agree to a fair price. If a buyer uses option 2 to establish a price, they can immediately calculate their bottom dollar value and use that as their lowest "Or Best Offer" price. That way, potential buyers looking for auction prices of your item can still have a shot at it by offering the seller a counter offer. Here are the PROS/CONS of this:
PROS
"Or Best Offer" allows the seller to react to market changes without having to constantly update their initial "Buy it Now" price.
Offering an "Or Best Offer" option allows potential buyers to feel that they are getting a good deal (as long as it's above your configured bottom dollar value).
The seller has an opportunity to reach to sudden market changes. As an example, if I had a PSA 7 Base Set Charizard listed well above current Market Vale (currently between $275 - $335 USD) and the "COVID Pokemon Boom" happens overnight, my card has now automatically adjusted without any seller input.
CONS
Quarterly, you will need to update both your "Buy it Now" and "Or Best Offer" price.
With the increase of supply (PSA cards specifically), "Buy it Now" prices will not be as effective due to the increase in sellers needing to liquidate their items as soon as possible. Holding onto all of that money over the course of 6-12 months (some even longer) was a burden that some sellers couldn't afford.
Since we're in a buyers market, buyers are willing to wait for auction prices since there will be a consistent flow of items up for auction.
