Tips for buying and selling online

Buying a conveyor might be a gamble compared to buying a book, but these simple steps should reduce your risk.

By -- Modern Materials Handling, 3/1/2001

People buy and sell online every day on e-Bay and Amazon. But in the business-to-business arena, it's still new territory for many-especially when you're talking about high-value items. Not to worry. Just keep a few simple points in mind and you'll see why General Electric exports do $30 billion in online transactions this year.

First, remember that buying online isn't so different from traditional methods. The difference is that with the Web, it's easier to find a large pool of sellers. You still have pretty much the same standard protections: transit insurance to protect against loss and damage, for instance.

Some buyers may worry that when they receive the merchandise-especially if they're buying used items-it may not be as represented. As vice president of insurance operations for WebTradeInsure ( b2b.webtradeinsure.com ) Eric Kaitz is experienced in the online auction business; his company specializes in insuring Web transactions. Kaitz notes that his company has had good success at getting buyers and sellers to work out their differences. Insurance providers and other third parties, such as banks, usually have an interest in making sure transactions are successful.

Cases of outright fraud are tougher to deal with. Because of the large dollar amounts involved in business-to-business transactions, it's difficult to get insurance against fraud. But prepurchase inspections and escrow services are the solutions here. Some online trading exchanges even offer inspection services. Kaitz notes there are third-party companies that offer short-term warranties on product functionality as well.

Sellers, for their part, can benefit from selling goods online. Selling goods via auction can drive the price up. Problems aren't unheard-of, though. A check can bounce. The high bidder you thought you'd found can have a change of heart. In the first case, the conventional remedy again applies: accept only reliable payment methods such as bank checks or wire transfers. If the problem is cold feet-well, at least putting the item back on the market should be relatively fast and easy online.