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Auction Buying Secrets – 7 Rookie Mistakes You Should Never Ever Make

So it’s your first auction and the place is full of people and excitement. The auctioneer is barking out bids, numbers and prices. People all around you are bidding on an item like it’s a long-lost childhood toy. You notice that some item you have just seen in the store sold for a fraction of the store price. A second item comes up and it goes for yet another great bargain. You think, “Wow, this seems like a pretty easy way to get things dirt cheap. Maybe I should bid and get in on the action. How hard can it be anyway…right?”

Wrong!

While great buys can be had at auctions, the opposite is also true. Getting stuck with something that isn’t what you thought it was can (and more often than not, does) happen. Below are some pro tips that you can use to avoid costly mistakes. Following the tips will save you a lot of grief and expense and give you the tools you need to bid like the pros.

#1 – Hidden costs

While auctions provide a means for anyone to find a bargain, it’s important to keep in mind many of the hidden costs often associated with auction buying.

Buyer’s Premium/Commissions

Most, if not all auctions have what is called a buyer’s premium. This is an additional fee that is put on all items sold at an auction. This fee can run anywhere from 10% to 20% of the item’s sell price. This cost is an additional fee that you will be charged for items you buy in addition to the price you bid. Beware – buyer’s premiums can add up very quickly. Auctions can often have different buyer’s premiums for those bidding online and those physically bidding at the auction. Every auction is different so take note of what these costs are and which fees apply to you before you bid.

#2 – Do a detailed inventory and inspection

If I can give you two pieces of advice here – it would be these:

  • Don’t assume all the parts or there.
  • Don’t assume missing parts can be requisitioned or repurchased.

I’ve seen to many rookie bidders thinking they got a great buy only to discover later that the items are no longer in production or the manufacturer is out of business. Do a detailed inspection of items to make sure all necessary items (ie. hardware, parts, controls, manuals etc.) are there. If parts are missing make sure replacements are available and have an idea of what the costs will be to fix, repair or replace what is missing before you bid.

#3 – Taxes & Fees

Depending on the location of the auction, be aware that different states have different rules about what taxes or fees they want you to pay. Some states are nothing some are 6% – 8% or more.

#4 – Remember…there are no “Do-Overs”

What that means is that “What you see is what you get!” and “You buy it, you own it!”

If an item you bid on doesn’t run or isn’t what you thought it was, you have NO RECOURSE later. The auctioneer is not going to give you your money back or allow you to back out of a purchase once you buy it. It is your responsibility to know what it is you are bidding on – NOT the auctioneers. Items purchased thru auctions are inherently sold “as-is, where-is” with no implied guarantee or warrantee.

Caution: Auction bidding is a fast paced game for grown-ups – not victims. At auction, you sign the auction’s terms and agreement paperwork before you are allowed to bid. This agreement is a legally binding contract that says you know what you are doing and what you are bidding on, and you assume all liability to pay for whatever you buy in the condition it is in when you buy it. If you bid on an item thinking it works or runs only to find out later it doesn’t – too bad. In other words – you buy it, you own it.

#5 – Removal Costs

Never forget, unless specifically stated otherwise, everything in an auction is sold “as-is, where-is.” If the equipment you purchased requires dismantling and/or removal, YOU (as its new owner) will be responsible for the disassembly and removal of the item – not the auctioneer or former owner. This can be very expensive.

#6 – Time Costs

Related to removal costs are time costs. There are often very short time frames and/or restraints for removal that you will be responsible to adhere to. Failure to comply with these can result in fines or legal action and even forfeiture of the equipment. The time you have to remove the item can also drastically affect the final sale price you and others may be willing to pay. I have seen time frames for removal that range from the same day as the auction to several weeks or even months. Know when things need to be removed before you bid.

#7 – Transportation

Items to big to move by yourself may require additional people or equipment to move. The auctioneer IS NOT going to do that for you. Don’t bid on items that will require you to hire or requisition additional people unless you know the costs of doing so in advance. With fuel prices on the rise, having to freight items across long distances can be very costly. Again, know and factor in all the costs before you bid.

There you have it – as with any great deal – the devil really is in the details. Please feel free to comment or share other auction tips or tricks in the comments below.

SJF Named One of Minnesota’s “100 Best Companies”

SJF Material Handling is honored to be named to Minnesota Business Magazine’s “100 Best Companies to Work For” in 2018. This is the 4th time SJF has been named to this prestigious list.

Qualifications for the “100 Best” Award From Minnesota Business Magazine

Minnesota is known for being a great place to live and work, with top-notch companies in many industries headquartered here. Each year, these companies submit nominations for the 100 Best Companies to Work For Awards by Minnesota Business magazine. This award recognizes Minnesota’s top companies and, time after time, helps the winners attract key employees who make all the difference.

The “100 Best” were determined by the resulting scores of an anonymous online questionnaire filled out by the employees of each participating company — to determine which companies in Minnesota excel in the areas of work environment, employee benefits, and overall employee happiness, making them the 100 Best Companies to Work For.

SJF will be honored in a celebration awards program and dinner on Thursday, June 28th at JW Marriott in Minneapolis.

Industry Insider Sales – March 26, 2018

Industry Insider Sales – March 7, 2018

Top 5 Rookie Mistakes New Entrepreneurs Make on Warehousing & Distribution

Starting any new business can be a daunting project, and setting up a new distribution center or warehouse where hundreds of different companies count on your efficiency can be downright overwhelming. As with any new business, you’re going to be purchasing equipment to outfit your operation and make it as efficient & profitable as possible. Many new entrepreneurs start this process from scratch and learn as they go. Today, you can’t afford to do on-the-job learning. You need to be on your “A-Game” from the start.

The following 5 tips (written by a 30 year industry professional) will help you avoid the most common pitfalls and mistakes that rookie entrepreneurs make that can bankrupt their business before it even gets off the ground.

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Pallet Racking Conditions – What to Know Before You Buy

Fact: There are more pallet rack options available to you now than at any time in history.

Fact: There are very significant differences between New, Used & Refurbished pallet racking.

Fact: You think you know everything there is to know about each – but really, you don’t.

The fact is, what one dealer says can often conflict with what another dealer says. As with any industry, there are several ways of doing something, but there are only a few ways of doing it right. The following article will give you some insight into what the differences may be between not only new, used & refurbished racking, but also the differences between the offerings from dealer to dealer.


New Pallet Racking

As you’d expect, new pallet rack is exactly what the name implies. New pallet rack is typically sold through authorized rack distributors. Rack distributors fit into two main categories: Stocking & Non-Stocking. The pricing that distributors provide can vary considerably. Stocking dealers and dealers who sell a larger volume of rack generally will get the best discounts from the manufacturers and will usually offer the best pricing to the customer.

Non-stocking distributors do not stock pallet rack, but rather buy & ship it directly from the manufacturer as they produce it. For this reason, rack purchased from non-stocking distributors will usually have a much longer lead time (4-12 weeks.) Rack purchased from stocking or non-stocking distributors typically comes with the same manufacturer’s warranty.


Used Pallet Racking

Used rack is rack that has been previously utilized by others. Used pallet rack can be found in conditions from ‘like-new’ with a few scratches to completely rusted or bent in places. Used rack can be a good investment for those looking to save money as long as the buyer takes some precautions. It is critical to validate not only the condition of the rack prior to purchase, but also the reputation of the dealer selling it. Start by finding dealers who have been in business for several years – the more the better. Check their web sites and avoid companies that don’t provide photos & descriptions of their equipment or if they don’t show pricing. The web site should also provide you with a physical address where the company resides, a phone number and the names of people you can talk to. They should also be able to verify that they own the equipment. Avoid dealers who will not let you inspect the racking before purchase. If the racking looks good and there’s little rust, the components should still have the same strength and capacity ratings it had when it was new.


Refurbished Pallet Rack

Refurbished pallet rack is another option available to rack buyers who want a lower priced alternative to new racking. Because there is little to no industry standardization for the term “Refurbished,” it is a good idea to ask what steps the supplier takes in their refurbishing process. While some dealers do a complete break-down, inspection & repair of the materials, some do not. The point is that not all refurbishing processes are the same. To make sure you’re getting what you pay for, equipment advertised as refurbished should go through many if not all of the following steps:

Inspection

Each piece to be reconditioned is thoroughly inspected. Components that are found to be damaged, cracked or bent should be repaired or replaced by experienced professionals. Replaced components should equal or exceed the manufacturer’s original specifications.

Clean & Prep

During this stage, all stickers, tags, etc. should be completely removed (not just painted over.) Dirt, debris and rust should also be removed prior to paint. Chemical baths or wire brushes are the preferred methods of removing dirt or rust prior to painting. While sand-blasting may be a cheaper process, it can remove some of the metal from the racking which can compromise the structural integrity of the product. No matter what method is used, make sure your dealer can confirm and will stand behind the original capacity rating of the rack.

Paint

Items that have passed the prior two steps are ready for paint. There are many different methods of painting. Whatever method is chosen, it should utilize paint that is specially formulated for industrial applications. For industrial applications, powder coat, epoxy & heated enamels are superior to cold applied spray or latex.


Renewed

Recently a new condition was introduced to the material handling industry. This ‘Renewed’ equipment provides “like-new” material at prices competitive with used or refurbished. Renewed products are manufactured as a blend of new & pre-owned materials that when combined, create a fully warrantied hybrid product that until recently, didn’t exist in the marketplace. Currently, SJF Material Handling is the only company offering renewed pallet rack.

Top 5 Things to Double-Check on a Pallet Rack Quote

So you’ve finally gathered the 3 competitive rack quotes that your boss requested a week ago. Now it’s time to sit down and give them a good looking over. While you may be tempted to simply look at the bottom line on each quote, you’ll want to first make sure you’re really getting the best price – not just the lowest.

5 of the most overlooked items on every pallet rack quote after the jump…
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Whatta Fish!

Tom Moore, SJF Solutions Specialist, recently caught this 17+ lb. Northern. That's quite a fish!

Tom Moore, SJF Solutions Specialist, recently caught this 17+ lb. Northern. Now that’s a fish!

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