Forums: Discussions for entrepreneurs and small business.

I think knowing the true source of the products is important. If you were to auction off some loot, you might be in for trouble with the authorities.

Chris - I am working on starting up an online auction service much like ebay only localized. I have been doing a fair amount of digging online for information pertaining to this topic. From what I have found it depends on the state/territory in which you plan to start the service. Some states like South Dakota require an auctioneers license to operate an online auction house, however it appears that there is a loophole for those that only provide a platform for users to auction their own items, although if they wanted to get particular they could stick you with a fine for acting as an auctioneer. The only way I can see around this is to set your fee structure up in such a way as to eliminate "consignment" type compensation. Say a per item listing fee or per item sold fee could be assumed to be a consignment fee by some definitions. I would have to do a lot more research before I could feel confident enough to say for sure but I think ebay gets around the auctioneer stipulation in all states. If you want more information about the plan I have for my auction site please drop me an email and we can talk.