TOP 5 THINGS TO KNOW ABOUT

Government SURPLUS AUCTIONS

a u c t i o n A N D a p p r a i s e . c o m

Municipal, county, state and federal agencies hold government surplus auctions when they have property they no longer need to conduct ongoing business. Although the agency may have no use for an item, you just might!

What’s considered a government surplus item? By definition, a surplus is anything produced or acquired in excess of what’s needed. In a government scenario, a surplus refers to any item that has outlived its useful life for a particular agency. The agency has determined selling the item at auction makes better financial sense than maintaining, repairing and/or storing it for possible future use.

Each item a government agency owns has an opportunity cost. When an agency decides an item is surplus, it has determined the proceeds of a sale can be put to better use than the value the item currently provides.

Here’s what you need to know to make the most of attending a government surplus auction:

1. You can often find items at below market prices.

Why do so many people attend government surplus auctions? Primarily, it’s because they can find below-market prices on surplus property – sometimes items sell for less than half their market value. Even big ticket items like vehicles can be purchased at amazingly low prices.

Because government surplus auctions are open to the public, anyone can bid on items. No special credentials are needed to get a good deal.

In fact, many people attend government surplus auctions with the intention of reselling items they buy. Reselling for profit has become an attractive business opportunity for auction goers. It not only puts cash in your pocket, it’s a lot of fun!

2. The diversity of items at a government surplus auction is a major attraction.

What can you find at a government surplus auction? The answer is easy anything any agency uses in its operation is fair game for a surplus auction.

For attendees, this diversity adds to the excitement. Because you never know what you’ll find from one event to another, government surplus auctions are one of the best places to shop for all kinds of property. Plus, the inventory is always changing, which keeps people coming back.

Some examples of items include:

• Vehicles• Heavy Equipment• Tools• Computers• Electronics• Office Furnishings• Building Materials• Kitchen Appliances• Machinery• And lots more!

Vehicles represent a big category for government surplus auctions. Because maintenance and repair costs tend to be higher for cars, trucks and other vehicles, government agencies have to run the numbers on an ongoing basis to determine if it makes sense to keep them. So, sometimes the vehicles offered at auction are in great working order and just may be older with higher mileage. Other times they don’t run at all and require repairs.

Usually the government agency and the auction service they hire will note any problems with vehicles. However, it’s up to you as a bidder to do a thorough inspection to determine current condition and value.

3. Items offered can be in excellent condition or in need of repair.

As discussed above, surplus just means the government agency no longer uses the item. It doesn’t necessarily mean the item has no value; it just no longer has value to the agency. Once an item has served its intended purpose, it can have lots of useful life left.

Agencies have many reasons for disposing of an item. For example, if an agency buys too much material or products for a project, they can auction the excess to the public. Also, if an agency needs more room, it can decide to sell some property and re-purpose storage space. In these cases, the surplus property can be in excellent condition.

Finally, an agency may be holding onto items that are in need of repair. Rather than make that investment, they decide to auction the assets to the highest bidder. In this scenario, they can use the sale proceeds for more productive projects rather than for repairing or storing non-functioning property.

Given surplus property may not be in working order, it is imperative you realize all items are sold as-is. The government agency and auction service provides no guarantees or warranties on anything sold.

Therefore, you must carefully inspect any item of interest before you bid. In the case of vehicles, make sure you take along a mechanic if you’re not mechanically inclined.

The auction house will conduct in-person inspection periods prior to the live auction event. Usually these inspections span multiple days and will be announced well in advance of auction day. Only after you evaluate an item and note any flaws can you determine the true market value (and your maximum bid).

4. It’s important to understand how the auction is conducted.

As noted previously, government surplus auctions are open to the public, so any private citizen over 18 years old with a valid driver’s license can bid on items. Typically, a government agency hires a professional auction service to conduct the event. The auction service evaluates items, writes escriptions, advertises the event, conducts the event and performs all other duties associated with selling the government’s surplus property.

Although usually conducted similarly, each auction will set its own rules and procedures. So, you’ll need to make sure you visit the auction website to register and read the specific terms before bidding.

The government auction may be conducted as a live-only event, an online-only event, or both a live and online event. If an auction is held online and live, you can begin placing bids as soon as online bidding opens and before the live event takes place.

5. Everyone can win with a government surplus auction.

No other auction offers such a winning scenario for all participants. Government agencies can conveniently dispose of property no longer needed. They save money on maintenance, repairs and storage costs, as well as earn extra revenue.

Private citizens have the opportunity to get items at reduced prices. Since government auctions are held on a regular basis, the inventory of items is constantly changing and being replenished.

Taxpayers benefit too. Auction proceeds from surplus government items help reduce the cost of operations. An agency that efficiently manages its assets doesn’t require as much taxpayer revenue to run. The auction proceeds help offset the cost of buying new assets.

Finally, the environment wins with government surplus auctions (or really any type of auction). When you buy from an auction, you’re doing your part to recycle and keep items from ending up in a landfill. Auctions represent the ultimate form of recycling!

Learn More about Auction Systems Auctioneers & Appraisers

Auction Systems Auctioneers & Appraisers, Inc. conducts all kinds of auctions, including government surplus auctions, on a regular basis. To find out more about our company, visit our website or contact us. Or, check our auction schedule for upcoming auctions.

About the Author Deb Weidenhamer is President of Auctions Systems Auctioneers & Appraisers,

Inc., based in Phoenix, Arizona. They specialize in auctions and professional appraisals. Visit us at http://www.auctionANDappraise.com or call 800-801-8880 for more information about Government Surplus Auctions.