How to Get the Most Out of Commercial Auctions
Toronto commercial auctions run by skilled local liquidators are an opportunity to access rare business equipment at affordable prices. Researching the liquidation process before you visit the auction house gives you the advantage.
So, what steps should you take to get the most from upcoming commercial auctions? Here, our Toronto-based business liquidators explore this topic.
Analyze the Auction House
The first step is to research the auction house and find out more about the company’s procedures. Are they able to show you the equipment directly and provide you with everything you need to know about its operation?
Consider all the auction house’s experience in the industry. Have they done the due diligence on the equipment? Also, can they show you the documentation that proves the equipment is in operational condition?
Another lead consideration is the experience of their team members. How long have they worked in the auction industry, and can they help answer your questions quickly and with precision? The information they provide will be crucial to helping you achieve value for investment at the auction.
Consider the Style of Auction
It has become more difficult for some companies to showcase their equipment in person as government rules continue to change. Therefore, you should research the style of bidding that the auction house offers and determine whether you’re comfortable with the sales process. For example, some companies are now hosting virtual auctions. If this is the case, ask to see a video of the equipment before the auction begins. As well, see if you can have the documents emailed to you to review the information and determine whether the machinery is suitable for your business.
Complete Equipment Research
Prepare all the information you need before attending the auction. Make sure you know what style of equipment you’re looking for on the day. Speak with local equipment experts about the equipment and its value, and determine how you’re going to integrate the system within your organization. Work with management and discuss their team’s requirements. Then, locate equipment to help respond to these needs with precision. Remember to document all the information you learn at this stage. Bring the data with you when you review the equipment in person and bid on the units at the auction house.
Set a Clear Budget
You can save money if you allocate your finances effectively before you visit a commercial auction house, but you must first set a clear budget. Take the time to research the equipment offered at the auction. Find out how much the machinery costs within the marketplace, and then set a specific amount aside for bids. Don’t be afraid to miss out on a piece of equipment if the bidding goes over your expected amount. You may experience lasting financial issues if you go well over budget on equipment.
Attend an Inspection Day
While you might have a busy schedule running your business and meeting with prospective clients, set aside a few hours to attend an inspection day. At an inspection day event, have the chance to review the equipment placed up for bid. It’s your chance to speak with the experts at the auction house about the equipment and its functionality. During the inspection day, you can also gain a greater understanding of the specific age and performance of the system. Make sure you have questions ready for the auction team during the inspection. For example, consider the following questions:
Are all the parts included?
If you’re buying an expensive piece of equipment, you should ensure it works to your requirements. Ask about the role that each part plays in the system.
What are the maintenance requirements?
Don’t waste time and money on equipment that requires a significant amount of maintenance. Take the time to review the required maintenance for the system, and then create a clear maintenance plan with your team. Creating a plan will help your staff seamlessly integrate the equipment after your successful bid.
What is the delivery timeline?
If you require the equipment for an upcoming project, make sure your requirements match the delivery timeline. During this time, you should also ask about the delivery process. Will the equipment be stored at the auction house, or will you take ownership of the equipment immediately after the auction is complete?
Explore All Terms and Conditions
What happens if the equipment malfunctions after you install it? What are your options if the equipment isn’t exactly as you expected when it arrives at your factory? Each auction house will have terms and conditions for the sale of equipment. It’s up to you to learn these terms and conditions and play your role in meeting them.
Take the time to review all terms and conditions set by the auction house carefully. If possible, have a legal expert review the terms and conditions documents they provide. The legal review process will help protect you and ensure you’re covered if the equipment doesn’t meet the required standard.
Another consideration is the financing. What types of payment does the auction house accept, and what are the specific payment terms? For example, the company may require a deposit to hold the equipment in their storage facility for you after a successful bid. How much is the deposit, and when does the deposit need to be paid?
Find answers to these questions and ensure that your accounting team is ready to handle each of the payment procedures required by the auction house.
Our Toronto liquidators can help guide you in maximizing your return on investment during equipment auctions. At Michaels Global Trading, our respected auctioneers are ready to help guide you in managing your company inventory. To discover more about our services, call us today for a consultation.