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How to Make Money on Equipment Liquidation?

How to Make Money on Equipment Liquidation?

Winding down a business is a straightforward process. The company notifies its employees, its vendors, its creditors and its customers that it is closing up shop. It pays its taxes and fulfills its contractual obligations. It liquidates its inventory and other assets by selling them off quickly, often for less money than the company originally paid for the items.

Inventory Liquidation

A business has several options from which to choose when it liquidates its inventory. It can use the distribution channels it has always used to sell its products, with prices slashed so low that customers can’t resist them. The company may get more money for its inventory this way, but it may take longer to sell the products and receive payment. As an alternative, it can sell its entire inventory to a liquidator, who will pay a lower price for the products but will take possession of them and pay for them immediately.

Desirable Products

From a buyer’s point of view, an inventory liquidation sale can provide a valuable opportunity to purchase goods at rock-bottom prices. However, liquidators can be picky about the merchandise they buy. They often avoid purchases of perishable or trendy goods that must be resold right away. They also stay away from products that are expensive to ship and to store. Instead, liquidators prefer to buy easy-to-move products with a long shelf life, such as power tools, books, toys and building materials.

Related reading: WHAT SHOULD YOU DO WITH OLD SERVERS AND OUTDATED DATA CENTER EQUIPMENT?

Pre-Sale Preparation

According to the Small Business Administration, preparing the assets for sale is the first step toward liquidation. A business should donate or discard items that are past their prime and sell only items that are in good, clean, serviceable condition. Owners should gather warranties and service records for vehicles, appliances, fixtures and make them available for prospective buyers to review. A written inventory listing each item, including a photograph, a written description and an asking price provides a business record of the sale for legal and tax purposes.

Splitting Inventory

A business owner may split items among several liquidators to maximize revenue from the liquidation of each item. For example, the SBA reports that restaurant equipment that is sold out of a restaurant brings 40 percent more than the same equipment that has been removed from the restaurant and offered for sale in a a liquidation center. A restaurant owner liquidating her assets may make more money if she liquidates vehicles and tools through a consignment sale and holds a liquidation sale at the restaurant for cooking supplies and equipment.

Free equipment liquidation in San Jose, Santa Clara, Sunnyvale & Milpitas 

Managing an optimized surplus equipment liquidation process is one of the crucial operations in the electronic manufacturing industry. The increased volatility in market leaderships has led Excess Logic to provide value added services to our partners in the form of equipment liquidation. We have warehouse specifically modeled for our inventory needs and the entire inventory is managed by a team of efficient professionals. Our facilities enable us to store components ranging from sub-assemblies to fully integrated products. Visit our website www.cleanbayarea.com to talk about surplus equipment liquidation.

by Marilyn Lindblad, Demand Media
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