How to Set Up an Auction Website

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Photo by Christina Hamlett

One person's junk can be someone else's treasure. And, if the proceeds of a purchase are going toward a worthy cause, it's much easier for shoppers to justify the occasional splurge. Whether you're in charge of a one-time fundraising event for a favorite charity or just get excited about the challenges of recycling previously owned goods, here's what you need to know to set up an online auction site.

Determine whether your auction website will be a one-time event for a 501(c)(3) charity or if it's going to be a for-profit Internet business. If it's for an existing charity, you don't have to get a business license and can proceed to Step 2. If you're starting your own nonprofit and the auction website will be an ongoing component of it, look at the Free Management Library (see Resources) to see if your new group can qualify for nonprofit status. If you're going to run your online auctions for profit, you'll need to get a business license and register your company name with the Secretary of State's Office. The Small Business Administration's website (see Resources) will walk you through the steps to do this.

Identify the types of items that will be available for bidding, whether they have by a common theme (i.e., sports memorabilia, toys, clothing, housewares), and who will be doing the donating. If you're organizing your online auction for a non-profit, most of the solicitation for donated items will be done through its own social channels and newsletters. If you're launching this enterprise from scratch, you'll need to get the word out by email, ads in regional newspapers and online, and asking everyone you know to contribute.

Design a simple form for each donation. This form should include (1) the name and contact information of the owner, (2) a description of the item, (3) its estimated value, and (4) whether the owner wants the item returned if it doesn't sell. Ask contributors to supply you with a jpeg photograph of each item. Note: if the donated items are being dropped off at a central location, you may want to take digital photos of them yourself.

Start creating your website. If you've never done this before, there a number of free tutorials on the Internet such as "2 Create a Website" (see Resources) that make it easy and fun. Many of them teach you how to choose a domain name, select a web host, and upload your content (photos and text) in a way that will be uncluttered and easy for your visitors to navigate. For instance, similar items should be grouped together so that someone who is specifically looking for "outdoor sports equipment" won't have to troll through the entire website. (The tutorials will show you how to create links within the website so that if you provide a table of contents, a visitor can click directly to the page that an item appears on.) A brief description should accompany the photo of each item. If there is a minimum opening bid, include that as well. It's also a good idea that the photos of your auction items be a uniform size; this may require using photo editing software to crop or enlarge the images.

Specify the methods of payment that will be accepted for the winning bids. In most cases, this will be by cash, check or PayPal. If the auction website is going to be an ongoing activity for the organization, you may want to talk to your banker about setting up an account that will accept credit cards. If the organization is a non-profit, be sure to point out on the website as well as on your contributor form that donations are tax-deductible.

Identify a deadline on the website as to when the last bids will be taken. People generally respond faster if they've been advised there's only a short window in which to respond. Consider using online tally software to keep track of when the bids come in and what the latest bid is. If it's for a one-time fundraising event, however, it will be more time-consuming but less cost-prohibitive to manage this procedure manually; simply note the date-stamp of each incoming email bid and adjust the latest bid(s) reflected on the screen.

Post the winning bids on the website when the auction is over if this is a one-time fundraising event. If it's an ongoing business enterprise, the items are simply removed from the website without mention of who acquired them or what they paid.


  • Subscribe to free newsletters such as Eric's Tips (see Resources) that provide advice on how to drive more business to your auction website and take advantage of the full spectrum of Internet marketing tools. Study commercial online auction sites such as eBay, Overstock and UBid to get ideas about layout. You'll also find it helpful to read consumer reviews of the top online auction sites at and take note of what consumers do and don't like in terms of navigating them. The "Art Business" website (see Resources) provides great ideas on conducting successful auctions where the primary merchandise is art.


  • Do not include any of the donating party's personal contact information on the website.