Reserve price auctions

In a reserve price auction, you’re able to set an undisclosed minimum price for which your item will sell, thereby giving yourself a safety net. Using a reserve price auction protects the investment you have in an item. If, at the end of the auction, no bidder has met your undisclosed reserve price, you aren’t obligated to sell the item, and the high bidder isn’t required to purchase the item.
For example, if you have a rare coin to auction, you can start the bidding at a low price to attract bidders to click your auction and read your infomercial-like description. If you start your bidding at too high a price, you might dissuade prospective bidders from even looking at your auction, and you won’t tempt them to even bid. They may feel that the final selling price will be too high for their budgets.
Everyone on eBay is looking for a bargain or a truly rare item. If you can combine the mystical force of both of these needs in one auction, you have something special. The reserve price auction enables you to attempt — and perhaps achieve — this feat.
The fees for a reserve price auction are the same as those for a traditional auction with one exception. eBay charges between $1.00 and $50.00 for the privilege of running a reserve price auction. If the reserve price is $200.00 or more, the reserve price fee is 1 percent of the reserve price (with a maximum of $50.00). When your item sells, your reserve fee is refunded. The reserve price auction is a safety net for the seller, but often an uncomfortable guessing game for the prospective bidder. To alleviate buyer anxiety, I recommend that you put reserve prices in the item’s description. This allows bidders to decide whether the item will fit into their bidding budgets. You can’t use the reserve price option in a Dutch auction.