Liquidation sales are often a good opportunity to get a bargain price for a product or bulk buy many products. When a company is in liquidation, it means that company is in trouble, and they are selling off their assets as fast as possible to pay back their creditors. This does not always mean there will be a ridiculous reduction in prices. The creditors are still trying to get a realistic return on their investment. Sometimes a liquidation sale is just a front, and the company is not really in the situation where they must sell their assets. This kind of liquidation scam is very common. Here is a look at how to avoid the scams and problems when buying at a liquidation sale, because they get much worse.
- Background Check. If a business has actually gone into liquidation, or voluntary liquidation, there will be a reputable company that is managing that situation. You should be able to find out more about this from whoever is holding the sale. Consider doing some online research into the details and current status of the business that is claiming liquidation. If a company is truly in liquidation, they will not be responsible for selling their assets and a professional liquidation consultancy will be handling it.
- No Refunds and More. It is important to understand in a true liquidation sale, the company will probably no longer exist after you have purchased your goods. You will not be able to get support and service you might normally expect. If you are buying goods from a wholesaler or retailer, check you are getting a manufacturer’s warranty.
- Understand the laws. You should investigate with your local consumer affairs commission or similar body. There may be particular laws to buying products under this type of classification. For example, some unscrupulous operators may be selling counterfeit items, and you will have no form of recourse. If you are buying at auction, you may also have no form of consumer protection in your state or country.
- Combined Selling. Some unscrupulous liquidators may take advantage of the stock they are liquidating by combining other stock they have on hand. You must try and find the source of all stock on the premises at the time of sale or auction. A good look at the ticketing and a thorough inspection of the products will usually help. Again, a keen eye and ability to interrogate, are the skills of a good buyer.
- Buying Online. Buying sight unseen from a liquidation sale can be very risky. Buying sight-unseen via auction is by far the worst scenario. As mentioned above, stock sold at a liquidation sale may not be covered by normal consumer laws and you because have even less consumer protection buying at auction online, buying liquidated stock online is not recommended, no matter how good the deal may seem.
With careful research and thorough stock inspections it is possible to get those bargain prices. Always have an eye of skepticism when you see this type of sale.
