How to Hold a Public Auction

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Holding a public auction is a great way to quickly sell off remaining items in a business, government or home - or even the home itself - if you plan to move, shut down shop or just free up space in your building. There are professional auction companies that can handle all of the arrangements for a percentage of the revenues, from advertising the sale, to removing whatever is left after the auction. Reputable auction companies follow an established code of ethics, and there are several credentials in that field, depending on their specialization fields (real estate, cars, home estate sales). But if you are willing to put in the time and effort, you can certainly hold the auction yourself.

Publicize the event in a local newspaper, preferably a week before the scheduled event if it is on a weekend and two weeks if it is on a weekday. Government auctions are usually advertised in legal notices. Indicate the range of items that will be sold. If you owned a restaurant, for example, you should note the biggest pieces of equipment like ovens and refrigeration units as well as tables, chairs, glasses, silverware, interior fixtures and even food products.

Require each participant to register if they plan on buying anything. The form should include contact information and a signature to acknowledge that they understand the rules of the auction and know that they are legally expected to complete the transaction if they enter a winning bid. In addition, go over the logistics for moving very large items, such as industrial ovens, after the sale. Establish whether everything must be cleared out of the building the day of the auction, or whether there's a time frame to come back with moving trucks.

Assign each person a sign they can hold up when they want to enter a bid. Generally after each bid you ask if anyone would be willing to pay more, and if not announce that the window to submit a higher bid is closing: "$200 for the dishwasher to bidder No. 3. Do I hear $250? No...Going Once, Going Twice...Sold!"

If there are any items that received no minimum bid, offer them as a package for a minuscule amount. If not, wait until only a few people remain in the building and allow them to have them for free.

Tips

  • For sales of surplus items, auctioneers' fees vary by price. For example, Brzostek's Auction Service Inc. of Phoenix, NY, gets 50 percent of the revenue for items that sell for $5 or less, with that percentage incrementally decreasing to zero percent with the most expensive items.