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The backbone of the online Auction is the (RDBMS) Relational Data Base Management System. It stores and manages the details of items, bids and most importantly, the winners.

As mentioned in earlier post; one has to bid for an item that is for sell in that site, and has to keep checking for the highest price that is bid for that item. But RDBMS makes it much easier for the users, it suggests the bidder the best (usually the optimal) value to bid for an item, the bidder can go for it or choose his own value. Even then, for every new bid for that particular item, it provides a comparative detail to each bidder.

Now how the Relational Database works is pretty interesting. I have been working in RDBMS for quite some time now. Well not in the field of online auction though, my domain of work is Telecom Industry. But the mode of work would not be much different, I assume. What I like most about RDBMS is, it is based on pretty simple principles yet is very powerful in managing Terabytes of data. Now lets come back to the Auction, it basically deals with three types of datasets, one containing the user details, another one having the product details, and the most important one consisting of the transaction details. These datasets or tables are linked by some common data type (column in tables) and they work as a single related huge database. Data changes in one dataset, affects the others and they all work in synch.

Fine, this was the Engine that makes Online Auction work. But now let us talk about the fuel, that helps this engine run, yes it’s the payment and delivery modes of Auction we are going to touch upon. As far as payment modes are concerned, the buyers have large number of options; Credit or Debit cards, Demand Drafts, Cheques, Cashier’s cheques, Paypal account; that would sum up to any standard mode of payment. They can also opt for services of some Escrow services or even cash payment on delivery of the merchandise bought.

The options can narrow down though, depending upon the Seller’s convenience and acceptance of payment mode. A business unit-to-person transaction is more convenient in the manner that, small business units usually accept all Debit and Credit cards, which is favorable for the Buyers too. But problem arises when it is a person-to-person transaction. These sellers prefer a Demand Draft or Cheque, either Personal or Cashier’s.

Even then, if both the parties are from different countries, the varying conversion rate of two different currencies might make it more complicated. Moreover the physical distance, makes the buyers and even the sellers more skeptic about the risks involved in the transaction. Here the Escrow services might add some relief for both parties, these services take a small percentage (about 5 percentage) of the cost of item from the buyer, and do not release the money to the seller until the buyer receives and approves the goods. But even this formula is not without loopholes; the buyers have to find a reputed and trusted Escrow service. And also, involving one more component in the transaction process, invariably causes delay in processing.

So this was precisely about the Engine and Fuel of Online Auction. The next topic would cover the risks involved in and suggested cautions; the bumps on the roads to watch out for.