How to Liquidate a Business

How to Liquidate a Business photo

There are numerous reasons that it may be time to liquidate a business. Whether your reason is retirement or business closure due to other factors, an auction can be a great method to liquidate your business assets. If you have an operating business and are desiring to liquidate surplus assets, an auction can be a great method as well. Let's explore the process we use at Pearce & Associates Auction Company and look at some of the benefits to using an auction for a business liquidation or to sell surplus business assets. 

Important Note

Avoid a big sale: holding a big sale can be effective in selling the more significant items, however without your more significant items it will be harder to liquidate the remaining items. This will result in worse results on the remaining items. Your most significant items will bring more buyers, who will also compete for the less significant items. 

Benefits of the Auction Method

  • Timely: A typical auction can liquidate business assets in a matter of weeks.
  • Decreased Workload and Stress: A full service auction company provides set-up (tagging, cataloging, photography), professional and precise marketing campaigns, invoicing, payment, and management of asset pick-up by buyers. 
  • Maximum Exposure: A professional marketing campaign can draw bidders from all around the world, especially if the auction is conducted online.
  • Results Represent True Market Value: If an auction is well marketed, all parties of interest will be competing for the assets resulting in fair market prices.
  • Reasonable Commission: No hourly fees will be charged to the estate, just a reasonable and agreed upon commission rate.
  • Total Transparency: Our system accounts for every bid placed on items. We will provide periodic marketing results, this way we can remain on the same page throughout the process. 

What items do well in a business liquidation?

We have conducted business liquidation auctions of businesses in a wide array of industries including construction, roofing, hardware stores, restaurants, machine shops, printing and manufacturing, and many more. The items in these auctions can include anything from vehicles and equipment to raw materials like lumber. If you are considering whether your business assets are a good candidate for auction, please feel free to reach out for a Free Confidential Analysis

What if I want to sell my business as an operating business?

An auction is likely not the best method for selling a business as an operating business.

What if my business liquidation includes Real Estate?

 To learn about the process of auctioning real estate and whether your real estate is a good candidate for auction, please reach out for a Free Confidential Analysis.

Steps of a Business Liquidation Auction

  1. Take Inventory of the Assets: Before calling a professional auction company, take an inventory of the items. 
  2. Reach Out: Give us a call, we will discuss the items and give you our thoughts on the best course of action. Many times, we will come to the location to take a survey of the items and provide a Free Confidential Analysis of the assets.
  3. Contract: Once we have a good idea of what is included and understand your wishes, we will provide a comprehensive proposal that will contain information like commission rates, marketing plan, timeline, etc. If you are pleased with the proposal, we will sign a contract.
  4.  Pearce Staff Set Up: Our staff will take it from here. We will be responsible for tagging, describing, cataloging, and photographing the items. All of this information will be compiled in our software and placed online. 
  5. Run Online Auction & Marketing Campaign: The auction will typically run online for between two and three weeks, a marketing campaign will simultaneously bring bidders from around the country to the bidding catalog. 
  6. Pearce Staff Will Manage Pick Up and Payment: Once the auction ends, we will be responsible for assisting buyers in picking up and paying for the items. The proceeds will be deposited into our escrow account.
  7. Check In Your Hand

Why Pearce & Associates Auction Company?

Pearce & Associates Auction Company has been trusted with the liquidation of hundreds of businesses over our 40 year history. We have had the privilege of conducting auctions for large corporations including AT&T, KBR Construction, ERS Construction, and Alabama Power. Some of these clients have worked with us for over 15 years. We have liquidated businesses in numerous verticals for a wide variety of reasons. As small business owners, we understand how important your business is to you and we understand the financial importance that your business carries. As experts in conducting and marketing online auctions, we are able to continuously provide service and results that are clients are pleased with. Our company is a part of MarkNet Alliance, this alliance has over 65 partner companies all across the United States. When you hire Pearce & Associates Auction Company, you don’t just get our experience and resources, but also the experience and resources of our entire alliance. We have a database of nearly 800,000 bidders worldwide. Pearce & Associates Auction Company has offices in Charleston, South Carolina and Birmingham, Alabama, but we are equipped to handle business liquidations anywhere in the United States.