posted on February 11, 2001 01:28:55 PM
As I'm sitting here writing descriptions this popped into my head.
Here is something I think the site could offer its members, buyers and non-members.
A section to help identify what you have. Such as antiques or collectables.
Like a reference book right on the site. It could be added to as we went along.
It could have what to look for in identifying marks such as some of your glassware. It could point out what to look for in the real thing or a fake. An informed buyer will be a much happier buyer.
And it may discourage anyone from trying to pass fakes off as the real thing.
And we could have a chat room also just for questions about such things. Post a pic to have someone help identify it.
This is an area that would greatly interest and help me, as I can't afford to go out and buy every reference book on the market.
Something to think about for services the coop may want to offer.
I'm not saying an appraisal site...just something to help us know what we have or what we are about to buy.
It also would be great for doing description, we can better inform our buyers as to what they are purchasing.
Maybe provide a link in our auction to the "reference book".
posted on February 11, 2001 05:29:46 PM
powerhouse, your questions regarding the membership and when in the planning process they acquire their "voice," are legitimate. Indeed, most readers probably have similar questions.
posted on February 11, 2001 06:00:45 PM
For Powerhouse and 1022:
What is the difference between a for-profit and a not-for-profit co-op?
Non-profit co-operatives are usually found in the housing, healthcare and childcare sectors. They do not distribute shares, although they usually have other member requirements such as committee involvement. Non-profit co-ops use surplus to enhance services and do not distribute profits to members. Co-op enterprises (profit-generating co-ops) generate surplus profits which can be used to strengthen the co-op by expanding the business and/or shared among members.
AND
Is a co-operative non-profit?
Although the primary goal of a co-operative is not to maximize profits but its service to members, a co-operative must, nevertheless, generate sufficient revenue to cover expenses and ensure its growth. After securing, in a general reserve, the capital needed to finance the expansion of the business, any surpluses remaining are returned to members.
Beyond this basic requirement, and in accordance with certain existing federal and provincial legislation on co-operatives, a co-operative may decide not to distribute any surpluses and therefore, in some situations, will meet the definition of a non-profit organization. There may, therefore, be two kinds of co-operatives:
for-profit co-operatives: those in which members may redistribute any surpluses of the enterprise among themselves in the form of returns proportional to their business transactions with the co-operative during the fiscal year;
not-for-profit co-operatives: those in which any operating surpluses of the enterprise may not be distributed to the members and must be returned in their entirety to the co-operative's general reserve. (For example, housing, day care, health and other similar co-operatives.)
_________________________________________
There's lots more info out and I'm expecting a call from a Co-Op professional by Wednesday.
posted on February 11, 2001 06:07:27 PM
Here you go, Jamie, ask and you shall receive...
The short answer is very little if anything, none in this context... The long answer follows...
Is there a difference between 'nonprofit' and 'not-for-profit'?
Summary: Both terms are frequently used and frequently seen. There is no firmly established distinction, though some people have strong preferences between them.
What is the difference between a nonprofit and a not-for-profit?
Several replies to this query are correct in the notion that there is no perceived difference between the two terms. Legal statutes even refer to the two terms as being synonymous. But the *practical* legal definition (as established by the wise and beneficient people at the IRS) does make a distinction.
"Not-for-profit" refers to an activity, for example, a hobby (like fishing).
"Nonprofit" refers to an organization established for purposes other than profit-making. Note here that nonprofit does not necessarily mean "charitable."
For example, a "nonprofit" organization can be an association of people who like fishing (though the activity does not have to be not-for-profit).
Legal folk and academicians tend to use the "nonprofit" term, whilst fund- raisers (such as the National Society of Fund Raising Executives) tend to use the "not-for-profit" term. Generally, this does not cause problems since everyone within the sector knows what everyone else means.
There is some feeling that "not-for-profit" more appropriately describes the organizations in this sector to the general public. IMHO, I feel that the use of this term in this manner introduces a layer of complexity on top of the "legal" defintion that only serves to confuse the general public. For this reason, I prefer to use the "nonprofit" term when I speak of organizations that operate without purpose of profit.
Also note that the use of the term "non-profit" with the dash in between the letters. There is no implied or distinctive definition attached to this word (as far as I know). I have noticed the use of this term to introduce concepts or explain technical aspects of organization when an audience is *not* familiar with nonprofit operations.
Everyone has a preference. But not everyone can cite a reference.
posted on February 11, 2001 06:16:23 PM
To the people that question whether this can ever happen, because of the diversity of the group: I imagine the transportation workers (and others) felt like this before there was a union.
It can happen, because it's been done many times before. -Jim
If the point of your question was to try to make a distiction between not-for-profit and non profit for the purposes of establishing this Coop, I'm afraid it won't work. Even though there might be subtle distinctions, both types of organizations are covered under the IRS' exempt tests which you've seen so far. a Coop with an auction site won't pass...
non-profit corporation
n. an organization incorporated under state laws and approved by both the state's Secretary of State and its taxing authority as operating for educational, charitable, social, religious, civic or humanitarian purposes. A non-profit corporation (also called "not for profit corporation" is formed by incorporators, has a board of directors and officers, but no shareholders. These incorporators, directors and officers may not receive a distribution of (any money from) profits, but officers and management may be paid reasonable salaries for services to the corporation. Upon dissolution of a nonprofit corporation its assets must be distributed to an organization existing for similar purposes under the "cy pres doctrine." In order for contributions to the corporation to be deductible as charitable gifts on federal income taxes, the corporation must submit a detailed application (with a substantial fee) for an Internal Revenue Service ruling that it is established for one of the specific nonprofit purposes spelled out in the Internal Revenue Code.
posted on February 11, 2001 08:07:42 PM
Oh yessssssssssss the infamous smiley glitch responsible for all sorts of fake merriment, I've heard of it but never met it in person until now...
posted on February 11, 2001 09:39:41 PM
I have read all of the posts (or as much as I could without dozing off (- about the formation of a coop and the potential tax implications thereof. I think that a lot of this discussion is superfluous at this time. I am a tax accountant (sorry, non-profits are not my area of expertise) with approx. 20 years experience in the field. As we say in the tax world, "Taxes are not the dog wagging the tail." In other words, the tax effects resulting from the type of business organization employed are totally subordinate to the economic viability of the business. Don't get caught up in the IRS tax code as it details the requirements for nonprofit tax status. People can (and do) spend their entire careers analyzing and debating tax law. If this thing is viable, a good tax attorney will easily be able to point us in the right direction.
In my opinion, what needs to be done first is the enlistment of a knowledgeable business leader outside of the auction community. I mentioned in a previous post about getting assistance from the SBA. As I recall, there are retired executives that can review business plans, provide advice, etc., for free. In addition, a co-op organization may be able to provide someone to guide us through the process.
I read the platform...my questions/comments are as follows. Please keep in mind that these are my opinions, you can and probably will disagree with some or all of them:
1. First and foremost, any discussion of fees, different membership categories, etc. in my opinion is like me buying a car tomorrow for my 2 year old son so he will have it when he drives in 14 or so years. It's nice to read about someone's (or some group's) thoughts about what fees should or could be charged...just not appropriate whatsoever at this time. Ditto for different memberships, types of products that will be allowed to be sold, feedback issues, etc., etc.
2. Whose proposed platform is this? Does the platform represent all of the different groups out there who are hosting message boards (the defacto "leaders" of this movement at this time)? What I see are several different groups all claiming to be the "coop auction group". We need to speak in one forum. Having the coop auction movement splintered (as I perceive it to be) plays directly into the hands of ebay. My suggestion is that the different "owners" of the message boards come to an agreement on a centralized posting site. Any individual posting about a coop auction on another site should not responded to except to direct that person to the coop site. Above all, we need to be organized and unified.
3. "And that the site needs to fill the needs of all members and not just the ones with the most resources or who have the most to gain from it. The fact is that $500.00 per month is more important to a single mom making some money to make ends meet than $100,000.00 dollars per month for a company like Disney."
This line troubles me...in my opinion, it is no business of the coop auction whether $500 per month is more important to anyone than $100,000 would be to Disney. It is difficult not to insert a type of "class warfare" into ones thinking...it is always easy to beat up on the big companies (I like to do that too!). The truth is (IMO again) all should be welcomed and the auction fees, benefits, etc. should be designed to be as fair as possible to all (not to say that some will feel that there are inequities...that is a given.) Be careful about including potentially inflammatory comparisons into any correspondence. BTW, the reality is that if Disney decided to put its surplus items on the coop auction, we would all be doing cartwheels.
4. Again, I read a lot of "we" in the platform...who exactly is "we"? Is it just Jamie's group...or is it Twinsoft's group, or is it both groups, or some other group? Does anyone have a comprehensive list of potential members? If so, what is being done with this. What is the security measures in place (I know a lot of us do not want ebay to know who we are, at least not yet)
5. In rebuttal to your denial of leadership...you are one of the individuals that people (IMO) feel are at the head of this whole endeavor temporarily. Either accept that or move to the sidelines quickly. Sorry if you or anyone feels that I am being overly critical. This leadership vacuum makes the enlistment of the business leader I mentioned previously all the more crucial.
I have worked for several major corporations (GE, GM, CIGNA, etc.) over the years. I feel that I can analyze a business situation and pinpoint what the essential elements are.
I am very, very interested in making a co-op auction a reality...the future of my collectibles business probably depends on it. I would gladly join in paying a membership fee (or whatever you would like to call it) to get this thing started, and would also be willing to donate a little time. However, until there is someone at the top who is knowledgeable about the process that will need to be undertaken and with the stature/business acumen to make this thing a reality, I will not be taking an active part in it.
Dave
[ edited by auctionfool25 on Feb 11, 2001 09:41 PM ]
What's needed here before a leader is someone (leader or otherwise) or a group to set forth a clear mission statement about where a leader would be leading us TO without talk of fees, taxes, or anything else like that. Then if enough people can get behind the concept, I do think Dave would probably make a fine candidate, among others who would also...
posted on February 11, 2001 10:17:33 PM
Well of course, but I don't see anyone stepping up to the plate.
Jamie & twinsoft both said they didn't want the leadership role.
All you guys seem to be doing is spinning wheels and repeating the same thing 10,000 different ways.
If you all are working on this behind the scene then I guess thats all well and good.
So tell me just WHO will be stepping up to the plate and when?
posted on February 11, 2001 10:23:09 PM
Hahaha Packer, don't ask me, I just got here 3 days ago myself, and I don't even really know what's in front of the scenes, much less behind them... All I know is that apparently like most every other seller, I feel an eBay boot pressing on my neck harder and harder as the days go by...
posted on February 11, 2001 11:50:03 PM
Ok, Maybe this is a little off base... but,
I think we should create an AUCTION CHAMBER OF COMMERCE.
That would get our members organized, have insurance (medical, dental, etc.) options. Chambers of commerce are also not for profit organizations.
In addition the auction site could be developed as a benefit for the On Line Auction Sellers Chamber Of Commerce.
This would be the same end, but by different means.
I agree with dMan. That there are sites already who can serve our needs. If we get organized through a Chamber Of Commerce we could have some weight behind what we say. We could ban together and use these free sites until we see that we can turn a site around.
I think the voice of many is much more powerful that the voice of one or two.
Just an idea....
In addition to that I would like to add... It is very difficult to follow this discussion the way it is set up. We need to have one central place where each issue is discussed and decided upon rather than discussing 20 issues in one thread.
posted on February 12, 2001 01:05:01 AM
AuctionFool, you raise points that directly address the main problems we all have been experiencing. I can only speak for myself. I am interested in discussing co-op ideas with anyone. I am not a leader. I don't represent anyone's opinion but my own.
I would like to speak to the question of big businesses in the co-op. I have nothing against big businesses. My concern is that big companies pumping lots of money into the co-op will have a de facto greater power, despite "one man, one vote." Disney doesn't need a co-op. Little mom-and-pop sellers being squeezed off eBay do. And no, I wouldn't be doing cartwheels if Disney or any other big company decided to sell through the co-op. I make no apologies for that, nor do I think it is wrong for a sellers co-op to be biased towards small businesses. I believe one of the goals of a co-op should be to help those who need help.
<<... you are one of the individuals that people (IMO) feel are at the head of this whole endeavor temporarily. Either accept that or move to the sidelines quickly.>>
I'm sorry but that statement really bugs me. That is a completely unfair criticism. "Either lead or get out of the way" makes a target out of anyone who is trying to help. If you think you can do a better job, then go ahead. But don't claim others are standing in your way because it simply isn't so.
I intend to keep doing what I have been doing all along - to bring up the idea of a sellers co-op as an alternative to eBay. I am no one's leader and I am not in anyone's way. So kwicher bitchin'.
Some great stuff. I'm going to deal with Dave's post briefly here. Dave, please repost this on our message board and we can go into this more deeply.
-----------------------------------
"I have read all of the posts (or as much as I could without dozing off (- about the formation of a coop and the potential tax implications thereof. I think that a lot of this discussion is superfluous at this time."
I agree. A good tax accountant can do wonders for any company. And if the co-op had to be a for profit that simply budgeted itself so that it had little profits it would be a similiar effect. And no, I'm not saying we have to go that route.
"In my opinion, what needs to be done first is the enlistment of a knowledgeable business leader outside of the auction community."
Well, we need to have a group with something to offer to bring in a qualified person. That means money and momentum. We have to work to get to that point.
"1. First and foremost, any discussion of fees, different membership categories, etc. in my opinion is like me buying a car tomorrow for my 2 year old son so he will have it when he drives in 14 or so years."
I disagree. We all need to know what's wanted to build a platform. If you check our other message board you will see some great stuff. Also, I have recieved over 200 emails (mostly supportive) with lots of ideas from people that are too shy to post on a board.
We also need to get everyone talking. I just don't see a down side to anyone talking about a part of something we all want to build in some form or another. Again, just my opinion.
"It's nice to read about someone's (or some group's) thoughts about what fees should or could be charged...just not appropriate whatsoever at this time. Ditto for different memberships, types of products that will be allowed to be sold, feedback issues, etc., etc. "
Well, we need to know what people really want? How would you propose to go forward??
The fact of the matter is that people (including me) have short attention spans. There are reasons why the Big 3 decided to raise rates and change rules in January/February you know? We need to keep discussion moving at all times.
"2. Whose proposed platform is this? Does the platform represent all of the different groups out there who are hosting message boards (the defacto "leaders" of this movement at this time)?"
This platform is the combined ideas that I've read from posts, emails, and some of my very own ideas that I've researched. Again, it's just being thrown out for improvement.
"This line troubles me...in my opinion, it is no business of the coop auction whether $500 per month is more important to anyone than $100,000 would be to Disney. It is difficult not to insert a type of "class warfare" into ones thinking..."
I understand what you're saying. But we have a very diverse group with different needs. I try to focus one the one member one vote issue but also I think how the co-op is organized will relate to these issues. Again, it's something we have to talk about and then decide on as a group.
There really is room for everyone.
"4. Again, I read a lot of "we" in the platform...who exactly is "we"? Is it just Jamie's group...or is it Twinsoft's group, or is it both groups, or some other group? Does anyone have a comprehensive list of potential members? If so, what is being done with this. What is the security measures in place (I know a lot of us do not want ebay to know who we are, at least not yet)"
As for groups I don't think there are any groups out there. There are people who agree and disagree on issues. There are message threads here on AW, on MAM, and on a bunch of other sites including the one that I post most of the information on. Cathy Labelle is working on an info website for the co-op with Dman.
I would prefer to only post here on AW but don't want to have moderator's having to work overtime!
"5. In rebuttal to your denial of leadership...you are one of the individuals that people (IMO) feel are at the head of this whole endeavor temporarily. "
I accept that I'm am leading a lot of the discussion and that I really see a co-op as the only alternative to any of the big 3. I think the time is now and I think it's going to be a lot easier than it looks.
I am not a leader however until we have a group and that group votes for a leader. I feel that we should have a governing board and hire ourselves our own Meg Whitman. I am not Jeff Bezos!
"I have worked for several major corporations (GE, GM, CIGNA, etc.) over the years. I feel that I can analyze a business situation and pinpoint what the essential elements are.
I am very, very interested in making a co-op auction a reality...the future of my collectibles business probably depends on it. I would gladly join in paying a membership fee (or whatever you would like to call it) to get this thing started, and would also be willing to donate a little time. "
Dave I invite you to repost on our other site and join the team. Join a committee. We won't get to point C if we don't get to point's B and A.
Email me or phone and we can talk about it and keep leaving these posts. It's great to talk about all of these concerns and issues.
posted on February 12, 2001 07:58:49 AM
I keep reading these co-op threads, and find it absolutely fascinating that many of the ideas being proposed are the very things being complained about in other threads about ebay.
Before people send money, they usually wonder how it will benefit them or their business directly. Send payment in advance for listing fees when you don't even know if the site will be around long enough (or at all) to let you use them? Divide the site into separate sections, with a more priveliged class of sellers and a less priveliged class, creating an unbalanced playing field from the beginning? Charging BUYERS for the privelige of BUYING? (yeah, I'm sure people will rush right over for THAT!), disallow offsite sales or website promotion?
From over here, this is sounding MUCH worse than EBAY for buyers and sellers, with the single caveat that they would have a vote... but no return on their 'investment' beyond that vote.
I know, they are just proposals/ideas at this point and nothing is final. I'm just seeing high irony here and wanted to point it out.
posted on February 12, 2001 08:13:01 AM
Think of the co-op as a business. Whether it is a not for profit or a regular for profit organization makes no difference when it comes to creating a business plan.
Every business must have a business plan. A statement of purpose (already well begun in these various discussions) and just as important a very specific outline of how to achieve that purpose.
Talking about specific listing fees and final value fees before you understand the costs and scale of the tools and resources necessary to achieve your purpose is putting the cart before the horse.
You want a user controlled online auction site. That is your basic purpose.
How much will this online auction site actually cost? The site registration, the site hosting, the hardware, the software? How much will legal and administrative fees for this co-op amount to? Advertising?
Once you have a basic plan and its associated costs you can then float the business plan to potential investors. And who are those investors? The sellers and buyers who are interested in a user owned online auction site.
Assume it will cost X dollars to establish the basic co-op. You then have two initial choices for funding the co-op:
1) A membership (or subscription) drive. Present the business plan and ask for commitments from folks. After a set period of time, take the number of subscibers Y and divide X by Y to determine the individual subscription cost. Get the money, set up the co-op and all of the initial subscribers list free for some period of time. Ultimately a fee structure will need to be in place to account for the ongoing costs of the co-op.
2) Apply for a small busuiness loan to get the co-op off the ground. The loan would be paid off through proceeds from a uniform fee structure. Anyone can list or bid. At the same time provide for folks to join the co-op as voting members by paying a uniform fee.
You must keep things as simple as possible initially and it is a good thing to have the KISS (Keep It Simple, Stupid) principle incorporated in the goal of the co-op.
Graduated membership fees will be a hard sell as those paying the higher fee will probably want more say in the co-op. Why should a corporate member pay 5000% more than me (as a buyer member) but have the same voice as me?
posted on February 12, 2001 08:23:11 AM
TOYRANCH: By all means, you have the floor, suggest an alternative. You and MAM have been around for quite awhile. Since the MAM started fees have gone up and services have gone down.
We threw out some ideas that were based on a few different financial models.
Again, by all means throw out one of your own. Let's talk about it.
As for what's in the proposal it's definately not worse than what Ebay is charging. If you are happy with the status quo that is your perogitive, if you want an alternative let's see some ideas??
And regarding the bidder initiation fee, it was not a membership fee to be allowed to bid but to be able to gain any membership benefits like health insurance, etc and voting priviledges. Anyone could list or buy from the co-op without being a member.
Great post Codeasuarus!
ALL: Like I said earlier when we posted the platform, it was a base for discussion. If you feel it's no good, suggest a better way to do this.
Most of us want a co-op. How we get one is a different thing?
Just read your post. Naturally, I have a few responses to the comments that you made. But before we get to that, I would want you (or someone) to respond to some of the issues I raised instead of focusing on a couple of comments that he/she dislikes in my initial post. For example, can we get those individuals who are the "owners" of the posting sites together to agree upon a centralized site? Or in reference to the platform, whose ideas does it encompass? One person? the entire prospective membership?
Note: I just briefly read Jamie's post above which provided some answers to some of these questions.
<<I would like to speak to the question of big businesses in the co-op. I have nothing against big businesses. My concern is that big companies pumping lots of money into the co-op will have a de facto greater power, despite "one man, one vote." Disney doesn't need a co-op. Little mom-and-pop sellers being squeezed off eBay do. And no, I wouldn't be doing cartwheels if Disney or any other big company decided to sell through the co-op. I make no apologies for that, nor do I think it is wrong for a sellers co-op to be biased towards small businesses. I believe one of the goals of a co-op should be to help those who need help. >>
I agree with some of the above, but disagree with some points as well. In my opinion, who are we to decide if Disney needs a co-op or not. Again, IMO the co-op needs to be blind...all should be welcome, the structure should be as fair as possible to all, and we should avoid making comments that appear to show bias. My business is probably what you would consider a "small" business. Yes, you are correct that small sellers are being squeezed off ebay or taken advantage of at the very least. However, when and if a large company would want to participate in the proposed co-op (of course with the same voice as any other member), the fees that would be generated from that company's sales would go a long way in subsidizing the costs of the co-op's comprehensive fee structure. If Disney's being involved (again within the confines of the co-op charter) results in lower fees for all of us, cartwheels (or perhaps a good headstand) are in order.
<<... you are one of the individuals that people (IMO) feel are at the head of this whole endeavor temporarily. Either accept that or move to the sidelines quickly.
I'm sorry but that statement really bugs me. That is a completely unfair criticism. "Either lead or get out of the way" makes a target out of anyone who is trying to help. If you think you can do a better job, then go ahead. But don't claim others are standing in your way because it simply isn't so. >>
Sorry that you feel that you were being unfairly criticized, that was surely not my intent. My initial statement's intent was to get someone (anyone) to recognize that they were temporarily steering this thing. That means taking responsibility. Right now, IMO, there are far too many sites and far too much confusion.
<<I intend to keep doing what I have been doing all along - to bring up the idea of a sellers co-op as an alternative to eBay. I am no one's leader and I am not in anyone's way.>>
My sense is that people (I know that I feel this way) feel that you and/or Jamie are "leaders" of the project at this time. You guys seem to respond to issues in a way that suggests that you are providing a voice of authority, then in the next sentence a disclaimer is provided that you are not the leader.
BTW, who is running the message boards that are out there? Those individuals are the ones who have access to e-mail addresses, potential membership information, etc. And when you get down to it, that information is the most important factor in this endeavor at this time. That information will be critical to getting a "grassroots" organization off the ground.
In my opinion, just "bringing up the fact of a sellers co-op as an alternative to ebay" is not enough anymore. Someone who is elected by the prospective co-op membership needs to steer this thing on an interim basis. Without responsible leadership, we will be many small, disjointed voices. That is exactly what ebay is hoping for.
<<So kwicher bitchin'.>>
Where does this comment come from. Does that mean that is someone has a viewpoint different than yours, even if critical of you, even if you feel that the viewpoint is unfair, the response is "kwicher bitchin'". Extremely unprofessional IMO. When I quit my "bitchin" as you so succinctly put it, it will mean one of two things...that things are progressing in a professional, business-like way, or that I feel that the project, though a nice idea, is doomed and unworthy of my time and financial support.
Again, let me reiterate, that all of the above is in no way a personal attack on Twinsoft, Jamie, or anyone. I think that all of us have much respect and gratitude for their involvement in forwarding this project. IMO, organization is the key for the successful implementation of a co-op auction which will have a direct, positive impact on the amount of net income that is generated by our businesses. We must make it succeed.
I just contacted ACDI VOCA to see if they can provide assistance and am waiting for a call back. Their mission statement reads, "ACDI/VOCA identifies and opens economic opportunities for farmers and other entrepreneurs worldwide by promoting democratic principles and market liberalization, building international cooperative partnerships, and encouraging the sound management of natural resources."
Nothing in there about a seller's co-op auction, but we'll see.
posted on February 12, 2001 08:42:34 AMTOYRANCH: By all means, you have the floor, suggest an alternative. You and MAM have been around for quite awhile. Since the MAM started fees have gone up and services have gone down.
Since ebay started, fees have gone up. Services have gone down? I don't know about that.... Can't say I agree there. Maybe not up, but I don't see that they've gone down.
We threw out some ideas that were based on a few different financial models.
Hmmmm... I've not seen any financial models. Financial models have cost projections, sales and growth projections, all I've seen is fee projections, and those aren't based on costs or services to be provided...
Again, by all means throw out one of your own. Let's talk about it. As for what's in the proposal it's definately not worse than what Ebay is charging. If you are happy with the status quo that is your perogitive, if you want an alternative let's see some ideas??
Not happy with the status quo... not at all. The fees are LOWER than ebay, true. But why can ebay support higher fees than ANY online auction site, by FAR and continue to do well? It's because they deliver more! Yahoo's fees are much lower than ebay's. If charging lower fees than ebay is all that needs to be done, why have they gone from 3million auctions to fewer than half a million in a month?
You have to offer VALUE to charge fees, and right now, and in the near future, there isn't much prospect of providing any VALUE for the fees, beyond a vote. What value do buyers receive by buying a membership in the co-op. What value to sellers receive? The privelige of listing on yet another auction site with little traffic, along with the fact that their buyers have to PAY at the door just to buy something from them? If that's the case, you have to offer MORE than they can get elsewhere..... I read a comparison to Sam's Club/Price Savers/Costco (membership warehouses) where members pay a fee to buy. Yes, but they pay the fee to buy at prices lower than anywhere else. So are sellers in the co-op going to offer lower prices than on ebay? How would they do that, and why would they do that?
Most of us want a co-op. How we get one is a different thing?
posted on February 12, 2001 08:57:24 AM
As posted on the other relevant thread-
Look, I'm starting to get a wee miffed about this little debate... Like I said, I've "involved" myself in this for 3 (now 4) days, but I truly and honestly believe this is "proceeding" in a haphazard and incorrect non-sequential way, and of course like many other people, I also believe I'm always right about what I believe (JOKE)... SOMEONE or SOME GROUP who has been involved in this thingie for a while needs to throw out a coherent mission statement so that the Online Auction Community (if such a thing exists) can get behind it, one with only the WHATs and WHYs of the whole project, NOT the HOWs. If noone does that, this thing will end up being the Doppler Effect Coop project- all these little suggestions about fees and non profits and taxes etc. will hit the water, and probably dissipate into nothingness. I would even take it on myself to write this lil' document, but I don't think that someone who hasn't been involved with the situation for a reasonable period of time SHOULD. A SPECIFIC suggestion-
Jamie, Toyranch, Magazine_guy, Nancy- from what I've seen, you 4 have the most experience with this, get together and see if you can agree on a mission statemnet to present to the whole community, then present it....
posted on February 12, 2001 09:10:55 AM
We're going to be organizing a first planning commitee on the message board. I urge all who are interested to drop in and post their interest in joining this group or email me.
Personally I don't want to get involved in the personality business. I did that with the TS issues and it was a big mistake on my part.
Some of the people that have done the most work in the past work regarding this movement haven't been mentioned in the past few posts.
Cathy Labelle, dman, Ross, 1022, and others have left numerous posts, emailed people, researched information, set up web pages and sorted out the message board. We need people who are willing to do work to go forward.
While I personally welcome just about every name mentioned in this thread, I am only interested in working with people who are interested in working on the co-op.
Talk is cheap. Skepticism is even cheaper. I know for me personally I don't want to know what group can't do, but what it can.
And nobody has suggested doing anything without concrete plans that are ratified by the membership of the co-op. At least not of the folks I'm working with?
Now is the time. If you truly want a co-op let's get to work!
posted on February 12, 2001 09:12:33 AM
The numbers in the proposal don't make sense if you want my opinion...
What is the value of signing up as a corporate or merchant member?
More money initially and higher per listing fees doesn't make sense.
By signing up as a Flea member I pay $145.00 plus 4% FVF for a year's worth of listings at 1,000 listings per month.
By signing up as a Corporate member I pay $3,500.00 plus at least 4% FVF for 3,000 listings per month?
By signing up as a Merchant member I pay $700.00 plus 3% FVF for 3,000 listings per month.
It appears that this rate structure is designed to attract Flea members (and possibly Merchant members in preference to Corporate members). 1,000 listings per month is probably sufficient for all but the Disney type online auctioneers.
So, let's use Canvid's numbers of projected initial membership (500 - 1000) with the vast majority as Flea members to see what kind of initial operating capital would be available.
$25.00 gives a range of $12,500 to $25,000 in membership fees. That is all you will have to get the site up and running.
Then, each month you can expect $5,000 to $10,000 in listing fees.
The FVF fees are much harder to calculate. Does anyone have a good idea of what 4% of the actual value of the actual auctions listed (and won) will be? For the sake of argument, let's assume a "worst case" scenario.
500 Flea members (after all, who would commit to the much higher cost Corporate and Merchant memberships for an untried site)?
10 auctions per member per day. After all the site is brand new and site stability and ease of use must be taken into account. Total for the first month is 300 auctions per member for a total of 150,000 auctions. Assume 7 day auctions so that the site shows a total of 35,000 auctions at any one day after the first week. Very impressive considering the total number of auctions at other sites we have seen in the past.
Assume the sell through rate is 25%. After all, the site is not generally known as yet and the startup budget did not allow for advertising and any sellers who try to advertise the site from eBay will be swiftly dealt with.
What is the average final value on those 37,500 auctions that sell in the first month? $10, $25, $50, $100? Let's calculate the FVF for all of these:
Thus, adding the listing fees of $5,000 per month the co-ops operating cash flow for each month will range from approximately $20,000 to $155,000 for 500 members.
You can run the numbers yourself for 1,000 members. For more listings per member. For higher average final values. For higher sell through rates.
But remember, as you tweak the numbers to satisfy your projected cash flow needs you are conducting an exercise in "what ifs?" and the projections may bear no resemblance to reality.
In addition, any decent business plan accounts for the fact that the business will operate at a loss for some period of time. The failure of many businesses to have an adequate cash reserve while the business' cash flow is built to meet or exceed the burn rate is the primary cause for many business failures.
You must also consider the effects on both sellers and buyers if your business plan is not met as you move along. How do you ensure that folks don't abandon ship because it seems to be approaching the rocks?
posted on February 12, 2001 09:30:03 AM
Disclaimer- This is not in any way, shape, or form a criticism of Codasaurus, who makes some obviously excellent points. It is simply in illustration of what I said about a coherent mission statement.
IF the cart was not put before the horse in this case, Codasaurus would have nothing to be be responding to except the concept. Since there's no mission statement, and the figures that Codasaurus is responding to are "preliminary" by Jamie's admission, and subject to the approval of the membership, why are we even talking about them? Why not-
One of the purposes of this Coop would be to provide a fee/pricing structure to be agreed on by the entire Membership that would be fair, reasonable, and competitive, yet substantial enough to provide funds for the continuing survival of the Coop. This fee structure would of course (again) be decided by the consensus of the Membership...
Is anyone out there gonna tell me that's not much better, and true to boot? Sorry, God is not in the details here, not yet.
posted on February 12, 2001 09:56:59 AM
Dave, let me say that your "either lead or get out of the way" comment had me seeing red. My response to you was colored because of it. I think that comment, especially vis. Jamie's work, is completely unfair. To suggest that the people who have done the most work towards putting together a co-op are now standing in the way is ungrateful and an insult, in my opinion.
In one fell swoop, your earlier comment dismissed all policy discussions as irrelevant. Then, ironically, you threw in your own ideas about co-op policy (should big business be allowed to sell through the co-op? ). That is a subject was have already discussed at great length.
<<In my opinion, who are we to decide if Disney needs a co-op or not?>>
I don't know who I have to be, but in my opinion Disney does not need a co-op. I have repeatedly stated, here and elsewhere, that I am concerned with any group gaining de facto voting power. A company that is putting $5M dollars per year into the co-op will have the power to sway voting. Your own comments, "the fees that would be generated from that company's sales would go a long way in subsidizing the costs of the co-op's comprehensive fee structure" demonstrate exactly what I am talking about. Pretty soon, the co-op sellers would all be in Disney's pocket. That is exactly what we are trying to avoid.
Even if it were possible to limit the power of big corporations within the co-op (which I doubt), it is another question entirely as to whether those corporations should be put in a position of subsidizing other sellers. This is simply not an open-and-shut case of Disney's money being the same color as anyone else's. There are other issues to consider. We've had a lot of good input on this from all sides. If you'd like to see the discussion thus far, I invite you to email me at [email protected] and I will send you the URL of "my" message board.
<<Does that mean that is someone has a viewpoint different than yours, even if critical of you, even if you feel that the viewpoint is unfair, the response is "kwicher bitchin". Extremely unprofessional IMO.>>
I don't mind criticism of my ideas, and even personal criticism. You and others seem intent on elevating Jamie or I to a position of leadership, while simultaneously criticizing our actions. You plainly stated that what we are doing isn't enough. I'm sorry you feel that way. I believe everyone is doing the best that they can. The idea of a co-op is being discussed in many places, not just Jamie's board or my own. Discussions are ongoing at Million Auction March, OTWA and other sites. Targeting leaders, and then complaining that those leaders aren't doing enough, is unfair and ungrateful, in my opinion. My comment was directed at anyone who prefers to criticize rather than help. Criticism of ideas is one thing. Criticism of individuals is counter-productive. And if you feel that my bringing up the co-op idea at AW is not enough, then I suggest you take a look at how far this movement has already progressed. If a co-op is to succeed, it will require both community involvement and community education.
posted on February 12, 2001 10:17:17 AM
No offense taken.
One of the problems in organizing any group is defining the common interests and common goals of the group.
I thought the common interest and goal of this nascent co-op was to get out from under eBay's onerous fees and practices.
If that is the goal then who are the potential members of this group? Not the big corporate types who are operating in conjunction with eBay. Not the casual sellers. Not the buyers.
The only group of folks who I think such a co-op would benefit are those who make a substantial amount of their income from eBay and would gladly switch to a lower cost venue if it existed.
The majority of these sellers are not going to take the risk of initial membership on the uncertain promise that it will save them money in the long run. These sellers crave stability and predictability above everything else. eBay affords these sellers a very predictable clientele and huge exposure of their items. The piddling increase in eBay's fee structure for its basic service is not something that will induce these sellers to abandon eBay.
If you are going to recruit more than just the folks who have a grievance with eBay over policies and procedures you will need to offer something very tangible almost immediately.
In addition, a buyer membership fee makes no sense to me whatever. I should pay to have a voice in a co-op that is essentially supported by the sellers? That is no voice at all.
Finally, assuming enough support is evident to get a co-op organized and an auction site up and running, how does the co-op intend to prevent defections over contentious issues such as deadbeats, scams, shilling, deceptive advertising, exorbitant shipping costs, failure to contact buyer or seller, listing fee and FVF credits, feedback.
I'm a buyer and a seller stiffs me. Who do I take my complaint to? And if I decide I don't like the answer and I say to heck with the co-op, how does that seller pay for costing the other members of the co-op my business?
I'm a buyer and I stiff a seller. Pull a switch. Send partial payment or late payment. Argue over the stipulations in the listing. Who does the seller make their complaint to? And what if they decide they don't like the answer? And move their business to another site? How do I pay the co-op and the other buyers for the loss of the seller's business?
You want a co-op auction venue? Or a co-op auction site?
If you want a venue then you have to keep your hands off just as eBay does and suffer the loss of folks who feel they got short shrift. eBay can do this because they have such a massive user base. Can a co-op do the same?
If you create a co-op that gets actively involved with sellers and buyers by policing listings, adjudicating complaints, punishing deadbeats and non complying sellers, handing out penalties, then you will certainly see folks leaving as the decision goes against them (where it wouldn't on a venue type site like eBay). Can you afford to lose these folks? Can you afford not to lose these folks?
As far as buyers are concerned, I have seen next to nothing in the discussion about how the co-op would benefit them. Buyers really could care less about the sellers. The buyer wants a good product at a good price and delivered yesterday. As a seller, you can moan all you want about how unreasonable buyers are but the simple fact is that they are your customers and they can take their business elsewhere.
So, I'll ask again. What is it about this co-op that is designed to attract buyers (regardless of whether they become members)?
is formed by incorporators, has a board of directors and officers, but no shareholders. These incorporators, directors and officers may not receive a distribution of (any money from) profits, but officers and management may be paid reasonable salaries for services to the corporation. Upon dissolution of a nonprofit corporation its assets must be distributed to an organization existing for similar purposes under the "cy pres doctrine." In order for contributions to the corporation to be deductible as charitable gifts on federal income taxes, the corporation must submit a detailed application (with a substantial fee) for an Internal Revenue Service ruling that it is established for one of the specific nonprofit purposes spelled out in the Internal Revenue Code. 
about the formation of a coop and the potential tax implications thereof. I think that a lot of this discussion is superfluous at this time. I am a tax accountant (sorry, non-profits are not my area of expertise) with approx. 20 years experience in the field. As we say in the tax world, "Taxes are not the dog wagging the tail." In other words, the tax effects resulting from the type of business organization employed are totally subordinate to the economic viability of the business. Don't get caught up in the IRS tax code as it details the requirements for nonprofit tax status. People can (and do) spend their entire careers analyzing and debating tax law. If this thing is viable, a good tax attorney will easily be able to point us in the right direction.