How a commercial asset auction works

If you have never sold through an auction before, the process can look opaque from the outside. It is not. Commercial asset sales commonly run as online timed auctions, and the steps are the same whether you are selling one machine or a whole factory. This guide walks through each stage so you know what to expect and what is expected of you.

Instruction and the asset schedule

The sale starts when you instruct us. We visit the site, walk the assets with you and agree which items are in the sale and which are not. This is also the point where we check for anything that cannot be sold: equipment on finance, items subject to retention of title, or fixtures the landlord may have a claim on.

We produce an asset schedule from that visit. It lists everything by location, with a note of make, model and condition. You sign it off before the catalogue is built. If something is missing or listed in error, that is the moment to say so.

Cataloguing and photography

Each item, or group of items, becomes a lot. We photograph every lot on site, record serial numbers and plate details where they exist, and write a description that says what the item is and any obvious faults. Descriptions are factual. Buyers inspect before they bid, and the catalogue has to match what is on the floor.

Lots are offered as seen under the auction terms, and buyers are expected to inspect before bidding, which is why accurate descriptions matter. The terms set out the basis on which each lot is sold and what the buyer takes on. If you are not sure how that works for a particular lot, ask before the catalogue goes live.

Viewing

Sales usually include one or two viewing days at the site before the auction closes, with the dates set around the size of the catalogue and the access at the site. Viewing is when buyers look at the machines, check hours and tooling and decide what they are willing to pay. Machines that can be run safely stay connected for the viewing day so they can be demonstrated, by your staff where that is agreed.

Anything that cannot be run safely is isolated and left safe. The site also needs clear walkways, working lights and someone available to answer questions about the equipment.

Bidding

An online timed auction runs over a set period, often a week or two, and each lot closes at a staggered time on the final day. Bidders register in advance, and bidding is open throughout. If a bid arrives in the last few minutes before a lot closes, the closing time extends. That stops last second sniping and gives everyone a fair chance to respond.

Each lot may carry a reserve, which is the lowest price at which you have agreed to sell. If bidding does not reach the reserve, the lot is not sold. Lots offered without reserve sell to the highest bidder whatever the price.

Buyer's premium and VAT

The buyer pays a buyer's premium on top of the hammer price. This is a percentage set out in the terms of sale before bidding opens. It is paid by the buyer, not by you.

VAT is charged where it applies and shown separately on the buyer's invoice. Whether it applies to the hammer price depends on the seller's VAT position.

Our charge to you as seller is a separate commission, with any agreed costs, settled in writing before the sale. Read the agreement before you sign it, and ask about anything you do not follow.

Collection and settlement

Once the sale closes, buyers receive invoices and must pay before they collect. Collection runs over agreed days after the sale. Buyers arrange and pay for the removal of their lots, including dismantling, lifting and transport, but they do not disconnect services themselves. Lots are isolated by a competent person before collection, and electrical and gas disconnection is by qualified people, which for gas means a Gas Safe registered engineer.

We attend collection days on site. We check invoices, release lots against paid invoices and record what has left. The auction terms set out what happens if a buyer does not pay or does not collect, and we explain the specifics for your sale when we discuss it.

When collection is complete and buyer payments have cleared, we reconcile the sale. You receive a statement listing every lot, the hammer price, our commission and any agreed costs, and the net amount due to you. Payment follows within the period set in the agreement.

If you are thinking about a sale, the most useful thing you can do now is make a list of what you have and what is on finance. Then get in touch and we will walk the rest with you.