Choosing a liquidation method
There comes a point in many people’s lives, when they are forced to “clean house” or liquidate. If they are moving to a distant location, it may be cheaper and simpler to sell their household goods than it is to pay the cost of shipping. Some just look around one day and find they have collected too much stuff over the years – WAY TOO MUCH! Things that we may need one day, stuff we are going to repair when we get around to it, items we never use, but are too good to throw away. Perhaps your inheritance just won’t all fit. Whatever the reason, IT HAS TO GO! How?
There are various ways to liquidate – estate sales, auctions, garage sales, consignments, and dealers. Which one best fits your situation? In order to answer that question, knowing the advantages and disadvantages of each and evaluating your situation is crucial. The advantage/disadvantages can be expressed in a formula:
Time + Difficulty = Money -OR- Less time + Less difficult = Less Money.
The quickest and simplest way to liquidate an estate is to contact a used furniture dealer, antique dealer or other independent dealer and simply sell everything to them. The two of you agree on a price, you get the money, he gets the furniture. Done! Now, the disadvantage: As you know from the formula: Fastest + Easiest = Least Money. A dealer does not appraise furniture item by item. The dealer does a mental appraisal of the lot with an eye toward costs for storing and advertising. He must also take into account the fact that some pieces probably won’t sell. Then if you are not prepared for it, his offer may give you a heart attack. The dealer is not trying to cheat you – it’s a simple trade off between a dealer who must make a profit and an owner, who hasn’t the time to “hang around.”
If time is not a worry and you require more money, but also want ease and convenience, then an auction may be your best choice. The auction house picks up your merchandise, takes it to an auction house, sells it and you receive a check. Some require you to pack everything. Other auction houses will provide transportation and packing services but expect to pay higher commissions for these extras. However, don’t expect a check right away. You may have to wait for months till the auction house gets enough “lots” to make a sale worthwhile.
If you want fast response and the right money, then choose an estate liquidation company for an on-site “Tag Sale”. An estate liquidation company will net approximately the same amount as an auctioneer and has similar commissions. You will need to remove items not for sale. The liquidation company will do the rest. The time involved is about two weeks from initial contact.
However, there are several differences between a liquidator and an auction. The liquidator will display your merchandise to its best advantage within the house, usually taking about a week to complete this. The auctioneer will hold a viewing, then items will be brought forth for visibility and bidding. The liquidator deals with individuals – the auctioneer tries to involve the entire crowd in bidding. The liquidation sale is usually a 2 or 3 day affair, with prices set the first day and negotiable on the last day. Everything is negotiable in an auction from start to finish because the crowd controls the prices. That’s what an auction is.
If your house is on the market in addition to needing possessions liquidated then an on-site sale increases its exposure dramatically. Just think, all the liquidation sale attendees seeing and talking about your home for sale. If you have a liquidation sale, the liquidators have arranged the house to its best advantage.
Still, there is an alternative to using outside services. If time and effort are not concerns, you may wish to hold your own sale. You control the profits. In fact, you control everything:
- Where it’s held – your garage, house, etc.
- Transportation of items
- What type payment you accept – checks, credit cards or cash only
- How it is arranged
- Pricing each item
- Recruiting several people for selling, crowd control and protection
- Disposing of unsold items
Now, if you have a full time job and/or family responsibilities, this can be an exhausting, disruptive undertaking lasting weeks or even months. It requires appraisal experience, knowledge of antiques and collectibles in order to fairly price items. You have to be comfortable dealing with people. If you are not experienced, you should probably expect to be “taken” because people with experience do attend these sales.