What Does an Auction Process Look Like?
Behind the Scenes with K-Bid Auctions
Mike Hopper of Surplus Liquidation Auctions talks with Chris Schwartz, president of K-Bid, about the auction process! From the initial conversation with folks looking to auction their items to listing and more, if you’ve ever had questions about the auction process, this episode is for you!
If you’re looking to sell online, Surplus Liquidation Auctions has years of experience getting the most value out of your items. Whether you’re looking to sell or looking to buy, check us out today!
What You’ll Learn
- How the process moves from initial listing to pickup.
- Why having a professional team on your side helps you move your items.
- What to expect when working with Surplus Liquidation Auctions!
Listen To The Audio
Transcript for ‘What Does an Auction Process Look Like?’
Hello. We are here with Mike Hopper of Surplus Liquidation Auctions, an independent affiliate of K-Bid. My name is Chris Schwartz, and I’m with K-Bid corporate office in Maple Plain, Minnesota. Today, we’re just talking a little bit about the selling process and how it all works, behind the scenes with one of our affiliates who’s been in the business for almost nine years now. And me and Mike have worked together throughout that time, and I know his skillset and what he brings. So I wanted to take a little bit deeper dive into what a seller can expect firsthand from someone that’s dealing with clients and auctions and putting it all together behind the scenes. So Mike, happy to have you here. Thanks for joining us.
Hello. Yeah. Good to see you. Thanks for having me.
Yeah. Why don’t you just tell us a little bit about Surplus Liquidation Auctions, SLA, the abbreviation. Tell us a little bit about you and your company and what you guys are doing.
Can do. I mean, a lot of what we do is in the name. That’s why we chose the name that we did. Surplus Liquidation Auctions, we do business, liquidations, surplus and business equipment, assets, essentially turning equipment and inventory into money for the sellers that we work with. So, that is a lot of what we do. We also do large estate sales where people are downsizing or selling property, and they’re needing to move out, and they might have acreage or large areas that they need to get rid of, a lot of different items that are household and/or toys and vehicles and that kind of equipment.
Yeah. The pole barns and everything else.
That is correct.
So why don’t you tell us a little bit about your auction process? When you’re meeting with the clients, what does it look like from start to finish with what you guys do and how that looks for auction seller, auction client?
Sure. So literally, usually with the first point of contact is a phone call with the seller, or the perspective seller that is looking to do something. And so, I usually have a phone call with them and talk through what it is their project is, what they’re looking to do, what they might already know about K-Bid or our company. And from that initial phone call, we usually set a time where I can come to their location and take a look at what they have. So I get my eyes on the project and get a feel for how much space they have, what they do, how much inventory or equipment they’re looking to sell. And from that point, we have a conversation about what it would take from our team to do what we need to do to get rid of the stuff they’re looking to sell.
Also, at that meeting where we’re face-to-face and I’m seeing what they’re wanting to sell, we also talk about terms and contract. And I actually have a
contract that I write and put together for them on the spot, so that they know exactly what we’re looking to do and what it’s going to cost or take for them on their part to do what we’re going to do. From there, if they agree and we move forward, essentially, we’re scheduling a day or multiple days where our staff is going to do the setup of the auction. Essentially, the setup is where we organize lot, tag and photo, everything that we’re going to sell. So whether there’s 50 items or there’s 1,200 items that we’re going to sell, and it takes one day or multiple days, our job is to essentially have our crew walk in there and from start to finish, essentially set up the auction and get it from a business site to an auction site.
So we’re also, during that setup process, figuring out, okay, on removal day, when everybody’s coming to pick up and pay for their items, what does that look like from this location? So we’re also organizing with the end of the process at the beginning, so that we know how we’re going to transition from, everything is sold now, how are we to get it out of here? So we start that process even at the front end, when we’re lotting and tagging and photoing everything and taking inventory of everything that we’re going to sell.
So, once we’re done onsite, then we have a team that does descriptions for us, and they put everything together based on what we’ve gotten from, information, notes that we’ve taken, and then the photos that we’ve taken from the items that we’re selling. So then, we go in and describe everything that we’ve just taken photos of and taken notes on.
So from the day the setup is done until we’re ready to actually put the descriptions and photos and everything together, it usually takes three to five business days, so that it’s ready to be an actual web-ready auction.
Once the auction is ready and it gets posted on K-Bid, it is on K-Bid for about 10 to 14 days. So, we hit two weekends because those are the highest traffic times on the website, but we’re going to be online for 10 to 14 days as far as the actual sale itself. Two reasons for that. One, like I said, it hits two weekends and those are the highest traffic times on the K-Bid website. And two, it allows us to do advertising for that sale specifically, so that we are target marketing to people that are looking for the kind of items that are being sold on that sale. So we advertise every single sale that we do in some capacity. And that allows us that time to be able to penetrate the markets that we’re looking to penetrate in order to find buyers that are looking for the stuff that’s on that particular auction.
So, once it’s been online for two weekends, we have what’s called a preview or an inspection day. That usually happens the day before the sale closes. So let’s just say for the sake of argument, the sale is closing on a Tuesday evening. On Monday, the Monday before that Tuesday night closing, we would have a
preview day for anywhere from three to seven hours where people can come to the location of where the stuff is being sold, and we are staffing that location that day, so that people can come and take a look at the items that they are possibly bidding on. So that preview happens on that Monday as an example. The sale closes on a Tuesday evening. Typically, our sales close in the evenings just because there’s more people available to do what they need to do from a bidding standpoint.
Then that Wednesday would be what we call our day of rest. And all that means is that the bidders that are winning bidders on that auction then have that day to get themselves organized, so that they can come on Thursday then and pick up the stuff that they purchased. So Thursday would be removal day in this scenario, where we are staffed with people there to be able to help people get their items paid for and then picked up and taken offsite.
And so, by the end of the removal, pretty much everything is gone that we’ve been selling. And two weeks from that day is when we would put together a full settlement of everything that we sold and what it sold for, and then the net proceeds or the check would match the net proceeds that is on that settlement, and we mail that to the seller two weeks after the removal day from the auction. So from the time of, hey, when we initially do the setup until everything is gone onsite, it’s typically three and a half to four weeks. That’s the timeframe as far as that is concerned.
As I’ve been referencing throughout this process, a lot of what we do is done on location wherever the seller is. So they provide the space for us to do it. If that’s not possible, we have space that we can rent, where we can talk about moving the stuff to a warehouse where it can be cataloged, and the setup can be done at our warehouse, but that’s not as often, I’ll just say it that way. So we have capabilities to morph and mold our process to fit what the seller is really looking to do, so at some of it just depends on what the seller is looking for and if we can come to a resolution on how that fits.
Mm-hmm (affirmative). And in regards to the onsite auction at the seller’s location, most times that’s most cost-effective for the client.
Which is why we want to do it for them that way because it’s way more cost-effective if we can do it that way.
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