I’ve said it for a long time, there’s a ton of money in live auctions. I think it boils down to customer excitement. People get excited at the prospect of getting a great deal. Retail spending is emotional for so many people, and if you can create excitement around people with money you’ve got a bustling business. Take a look at Marcus Barela Auctions, which I stumbled upon last week while internet surfing. Watch the video (sorry about the sponsor advert) and then read on through my full rant today.
The way I see it is you have two ways to make some cash running a liquidation auction:
- Auction full pallets of merchandise to those who intend to resell merchandise. With this angle, you would collect their resell license/permit number upon entering the door and registering to bid. If resellers did not have full sales tax documentation, you would have to charge sales tax upon checking out.
- Break down pallets and sell items individually. This is where the excitement really begins because I would roll a cell-wrapped pallet out in front of the audience and start auctioning off item by item from the top. With this method you would want to be sure that everyone within the buying audience knew about the risks of purchasing customer returns. I would simply spend about five minutes before each auction explaining customer returned merchandise. Explain the risks and then tell the audience that all bids are final…you win the item, you won the item. There would be no returns. When you school the audience be sure to tell them to bid accordingly.
Turn the volume down when you watch this one:
This is Via Trading’s monthly auction held each month to a bustling crowd of people who want to buy in bulk at a great price….
Type and source of merchandise to auction:
I would think the best pallet merchandise to auction would be general merchandise. I would not try and auction clothing unless you were offering large pallet or skid quantities. Walmart shelf pulls and customer returns would do really well at a retail auction. I also think Home depot customer returns would create a bidding frenzy! Just about any major department store offer general merchandise pallet that would be great for this type of business. Remember, general merchandise consists of household goods, home décor, toys, furniture, lawn & garden items, and other fast selling merchandise!
What do you think about idea? Any thoughts, or perhaps, you are actually running a business like this? I would love to hear from you…tell us about your experience.