What are liquidation sales, and how do I get the best deal?
“Liquidation” has become a buzzword among deal-seeking consumers and rival businesses alike. Whether it occurs between businesses or it becomes a direct-to-consumer sale, store liquidations are a great way to get the most affordable deals for quality products.
But what exactly is a liquidation sale and how can you take advantage of these great deals?
What is a liquidation sale?
Just like liquid flowing out of a bottle, a liquidation sale occurs when a business hopes to move many products off of its shelves quickly. Though this is commonly seen among businesses that are on the verge of closing down, some stores engage in a semi-annual liquidation at the end of each season to purge unwanted merchandise and make room for new stock.
In financial terms, a liquidation sale involves selling company assets as a necessary way to generate capital. This often occurs when a business is in debt to creditors or other lenders that need to be paid back in a short amount of time.
Many think that this means a store is simply selling unwanted goods. However, a true liquidation sale may mean a store is selling machinery, art, company vehicles, and more. These assets can be anything the company owns, both big and small. Though this might be bad for the business selling their goods, it’s a great opportunity for rival stores to stock up on great products.
How do I get the most out of a liquidation sale?
You have a number of strategies to consider before entering a liquidation sale. The first step to forming a plan is identifying the products offered by the store.
Knowing what products are typically sold by a certain store can streamline your goals during a direct liquidation event, but knowing the true costs of these items is at the core of these sales. Though it might be tempting to pick up an item with a huge discount, you might be able to find the same item at another store for far cheaper. Don’t let brand equity blind you when you’re trying to find the best deals.
The second step is knowing what products will benefit your own company. Again, even though a huge discount is tempting, your store might not need another car in stock. Price comparisons might make the process take a little longer, but it’s worth it in the end. Shiny, new toys look great for a low price, but if your company doesn’t need the product, you’re simply wasting money.
Step three: Look for warranties. This doesn’t always work when a company is going out of business, but some products feature warranties directly from the manufacturer. If you’re able to snag one of these sales, you can benefit from the customer service offered by the manufacturer at a low, low price.
Want even lower prices? The final step is to find out when the store is actually closing. Unfortunately, this strategy isn’t for the faint of heart, because by the time of the closing date, few items will be left to grab.
However, the closing date can give you a better idea of the sale. One day, an object might be half off. The next? Another 25 percent off. But there’s no guarantee that a popular product will be on the site the next day. You want to weigh the popularity of the item against the timeline of the closing sale to ensure you get the best deals through a liquidation auction site.
Liquidation sales are a great opportunity to get valuable goods for cheap prices. Follow these tips when you want to make the most of liquidation auction sites.