Sleeping With Your Competitors
As I started to write Part II of my post on “Eliminate The Competition”, I realized there are so many components involved that it’s better if I explained a few components separately so that they’ll make more sense and impact for you.
One of those components is for you to sleep with your enemies or competitors.
Here’s a case in point.
Have you ever been involved in bidding for an item at a physical auction (not online auctions at eBay)?
I had a car put up for auction back when I had completed my law studies in the UK, just before I left for home.
Interested parties to a particular item being auctioned off would then show up to do their bidding.
If you’re one of them and you’re buying items at auctions to make a profit (instead of using them), this item has value to you only if you’re able to buy it significantly below its market price so that you in turn can sell it off at the actual market value for a big profit.
(The idea behind an auction is a different one depending on whether you’re a seller or a buyer. For the seller, he thinks he can get a good price from a bidding war among interested buyers. For the buyer, he wants to get a bargain so that he can resell it for a big profit. Of course, there are those who are not out to resell, merely to acquire the item for their own use, but let’s talk about the profiteers for the purpose of this post.)
If you’re a buyer and you knew in advance that all your fellow bidders are out to make a profit on the item (this is easy - regular auction attendees meet amongst themselves for this purpose) - wouldn’t it make more sense for all of you to get together and agree not to outbid each other so that the price of the item would not be increased beyond what would be profitable for any of you?
So just one bid is required to secure the item if there’s no reserve price for it, or that one bid is above the reserve price (which is usually revealed).
All of you then decide who is to do put in the lone bid, and how the mechanics of the sharing are to be carried out.
The winning party then takes the item, and proceeds to make a profit by selling it off at its actual market value. That profit is then shared by all those at the auction, at a later date.
Alternatively, the winning bidder can even pay the others some money for “doing their part” either before the auction starts or as soon as he has secured the item.
This is actually happening at auctions everywhere.
Auctions for property are especially popular, due to the high value involved.
Cars, too - due to the quick turnaround time between buying and selling them as less documentation, procedures and expenses are involved compared to the buying and selling of a piece of property.
This also works for parties putting in tenders for a project, with every party arranging for one party to win it. The winner will later sub-contract the job out to the parties involved based on criteria agreed earlier.
When you sleep or co-operate with your competition for mutual benefit, you’re “eliminating your competition” altogether.
Right? 
Warm Regards,
Sen Ze
P.S. I was totally puzzled when my very-good-condition car with a brand-new sunroof in the auction above fetched only a quarter of its market value with just 2 bids! It took me some time to realize what happened.
P.P.S. That realization came during a property auction that I attended as a lawyer representing my client (a bank) who was auctioning off a piece of property it repossessed from one of its borrowers who had defaulted on his home loan. The bidders were openly discussing among themselves on how to bid and how much to bid - and the auctioneer received only a single bid!
P.P.P.S. You can link to this post with the following URL:
http://www.SenZe.com/business-blog/competition/sleeping-with-your-competitors.htm
