The two questions I’m asked most by prospective clients:
• How do I evaluate my store for liquidation?
• What will I end up with once the bills are paid?
Store evaluation is not exact science. There is no hard and fast formula to follow. Every store and situation is different and our evaluation is based on many factors and trends plus our vast experience!
When evaluating a store for liquidation value there are many characteristics and trends that must be considered. The following are some of the most obvious:
1. Type of store. Large ticket, long margin, high volume stores get a better return than small ticket, short margin, low volume stores.
2. Fully stocked stores get a higher percentage return than stores with sold down inventories.
3. High volume stores get a higher percentage of return than low volume stores.
4. Stores with current, well balanced inventories get a better return than stores with old, out of season merchandise or out of balance inventories.
5. Large stores tend to get a higher percentage return than small stores.
6. Long established stores get a better return than stores that have been in business a short time.
7. Sales trends must be considered. Down or up and how much.
8. Store location and parking.
9. Sales and discounts taken prior to the Liquidation Sale.
10. Store image.
When making projections I use all the above and many more store characteristics and trends. Most of all they rely on our years of experience. The one unknown factor is the store owner’s willingness to cooperate and follow the sale plan. Communication with the Consultant is essential.
Chuck Haug
CCH Consulting
520-305-9693