Each year, thousands of businesses across the United States are forced to close. In some cases, this is due to economical reasons. However, in others, the business owner may be deep in debt and left with no other choice than to declare bankruptcy. When a business closes, this often leads to a liquidation in order to sell off the company’s assets.
If you are experiencing this difficult situation for the first time, you may be unsure how the process of liquidation works. For the most part, a business that is closing, especially one in debt, will host an auction in order to sell off valuable merchandise, fixtures, equipment, and other items in order to pay off debtors. This is done through business liquidation auctions. Here are some questions you may have about this process and the answers you might need.
What can I expect before the auction takes place?
Before you hold an auction, you will need to meet with an attorney to ensure everything is in order. From there, choosing an auction company will help your prepare for the liquidation sale. Generally, a business will work with an appraiser for a machinery and equipment appraisal to find out what the business’s larger items are worth. From there a date will be set for an auction, and the items and their starting bids will be listed.
What if I’m holding an online auction?
Because the internet offers more convenience and the chance for higher bids, many auction companies will hold the auction liquidation both in person and online. Online auctions usually work the same as a live auction, only the items could be up for viewing and/or bidding for a longer period. The process of preparing for liquidation auctions online, however, is the same as it would be for a live auction.
Who else will I work with?
Because it is an auction liquidation rather than a standard business auction, you may be working with a bankruptcy attorney if you have filed Chapter 11. (You may also have an attorney if your business closed due to a personal bankruptcy instead.) Appraisers, CPAs, attorneys, and other officials may also have a hand in the liquidation. Some of these can be especially crucial in making sure that your business’s closing and/or bankruptcy complies with the law.
If you have more questions, be sure to speak with an auction liquidation company about your options. All of these situations are different, so it’s important that you receive accurate advice that pertains to your business’s circumstances. If you have additional concerns, leave a comment below. Learn more at this link.