tag:blogger.com,1999:blog-12584684333376335372024-03-13T11:50:24.373-07:00Storage Auction Experts BlogStorage Auction Expertshttp://www.blogger.com/profile/15697367001764015335noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-1258468433337633537.post-90974209030819111872014-08-12T13:34:00.004-07:002014-08-12T13:34:47.723-07:00Lock Cuts, Sooner or Later?<div class="MsoNormal" style="text-align: justify;">
Probably the most debated procedure of
the auction process is when the locks should be cut and the contents of the units
inventoried. We ask ourselves, should they be cut as soon as possible in order
to gain maximum profits from the tenant? Or should the locks be cut at the auction to
attempt to save the tenant money in fees and the purchase of a new lock? Some
managers suggest meeting in the middle, and cutting the locks just before the
newspaper advertisement is placed. There are reasons each facility has their
own preferences on this matter, but let’s go ahead and discuss some of the
benefits of cutting locks sooner rather than later. <o:p></o:p></div>
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Before we discuss which particular
method may be best for you, understand that there is more to the auction
process than when the auctioneer simply shows up to sell the units. Instead it
is initiated on the first day the unit is delinquent; gate access is no longer
permitted, phone calls are made, units are over locked as soon as possible, and
the pre-liens and liens are processed. Lock cuts, advertising, and staying in
touch with your auctioneers from Storage Auction Experts are a few ways you may
be able to maximize your overall profit and recovery. <o:p></o:p></div>
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First we should discuss the
auction buyers’ favorite part of the process, which is the process of cutting
the locks at auction. Yes, it does add excitement<s> </s>to the buyers’
imagination as they watch the locks being cut, and smell burnt metal in the
air. They love knowing that no one has seen the unit, and that anything could
come from behind those doors. Even the occasional empty locker that is cut
open, although at times disappointing, is still exciting, as it provides
further evidence that no one has seen the unit since the day of over lock. Sites
that do this method<s> </s>tend to be favored by auction buyers; however there
are some disadvantages to cutting locks at auction. Sites can miss out on many
opportunities of advertisement if there happens to be something extraordinary
in the unit. They also eliminate the possibility of renting out the unit to
potential clients if it is empty, along with the opportunity to collect lock
cutting fees; or the sale of a new lock to those who pay up before auction
time. Additionally, it is also very time-consuming to cut locks during the
auction adds pressure of speed and efficiency, and possibly permits more hasps
and doors to become damaged. Therefore this method is not recommended to
recover maximum returns from the auction process for sites with a large number
of delinquent units, or for those whom are over 85% capacity on any particular
size unit.<o:p></o:p></div>
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The most common procedure manager’s
use is to cut the locks before the auction, normally about 3 weeks in advance.
This is a practice managers feel safe doing. They feel they’ve given the tenant
every chance to avoid additional fees, while still saving enough time to do a
proper inventory and prepare for auction. This may also be preferred because normally
cutting the locks is the last attempt to “scare” the tenant into paying the
bill. The tenant then realizes their lock has been or will be cut and they need
to take this matter seriously before the next step: Auction! <o:p></o:p></div>
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Furthermore, cutting the locks
before the auction is also the preferred method simply because it enables you
to organize a smooth running auction on auction day, eliminating mayhem and
surprises. It saves wasted time on empty units, and most importantly allows you
to advertise and roughly appraise the merchandise and have a chance at making realistic
auction price expectations. We recommend this method because it may allow you
to better take advantage of the entire auction process instead of cutting locks
the day of auction. It is important to realize the auction isn’t just about how
many bodies attend, but the buyers that are present bid on the true quality of
each unit, and lost earnings from defaulted units are recovered as much as
possible.<o:p></o:p></div>
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We have found that cutting locks
as soon as possible reduces the amount of delinquencies as well as improving
the cleanliness of facilities, making it overall the most profitable measure.
However, it is tough to convince others of this. Follow the law strictly. There
is a reason the court system has recognized specific time periods for the
storage industry; they have been proven to work, take advantage of it.<o:p></o:p></div>
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Some ways you can help the process along are
to shut down gate codes from the beginning to force the tenant to walk into your
office and talk to you. You can’t legally deny them access to their unit, so
you’ll have to let them in, but you can shut off their gate code. Getting them
into your office increases the likeliness that they will either pay you the
rent and/or not leave you with a thrashed, picked over unit of garbage that
contains nothing sellable. Schedule someone to do overlocks on the 30<sup>th</sup>
day late assuming the pre-lien was sent out on time, or the first legally
permitting day early in the morning. Be sure to make a strict routine so time
doesn’t get past you. Get every delinquency in pre-lien and lien status as soon
as possible. If your pre-liens aren’t ready to be mailed by closing on the 15<sup>th
</sup>day then you are adding time to the process. The same goes with liens by
the 30<sup>th </sup>day. While this may cost some extra money the first couple
of months, it is possible to recover the money lost in your fees.<s> </s>Including
this process in your contract may not only make you money, but it can train your
customers to pay on time. Once they realize there are fees and consequences
they will take you seriously. Once all the paperwork is processed, schedule to
cut your locks within the same week, preferably with an outsourced insured and
bonded company like Storage Auction Experts. <o:p></o:p></div>
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While every facility has a
different procedure, cutting the locks at the first chance is strongly recommended.
It gives you a bat to swing when these tenants’ start throwing you fast balls.
You also make money by charging for the lock cuts and selling them new locks. Also,
you don’t have to settle as much because you have a rough idea of what is in
the unit. Take advantage of having the upper hand. If you feel uncomfortable
playing hardball, you can always provide a free lock to ease the blow. At least
you have the ball in your court, with all advantages in your favor. <span class="MsoCommentReference"><s><span style="font-size: 8.0pt; line-height: 115%;"><o:p></o:p></span></s></span></div>
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By using a professional lock
cutting company your locks, you can help eliminate the possibility of the
manager being accused of stealing any valuables out of the units. Attorneys
will likely agree that by having a professional insured and bonded company
remove the lock will drastically reduce liability for the removal of the
tenant’s lock. We at Storage Auction Experts are not only insured and bonded, but
we have thirty years of auction expertise, which can only maximize your auction
experience!<br />
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<div class="MsoNoSpacing">
<b><span style="color: #444444; font-family: Arial, Helvetica, sans-serif;"><i>Travis Regalo, Auctioneer</i></span></b><br />
<o:p></o:p></div>
<span style="font-size: 11pt; line-height: 115%;"><span style="color: #0b5394; font-family: Times, Times New Roman, serif;"><i>Storage
Auction Experts</i></span></span>Storage Auction Expertshttp://www.blogger.com/profile/15697367001764015335noreply@blogger.com31tag:blogger.com,1999:blog-1258468433337633537.post-48335274558587385722014-05-27T08:38:00.003-07:002014-05-27T08:38:51.235-07:00Live Oral Auction versus Online Storage Auctions<div class="MsoNormal" style="text-align: left;">
<span style="font-family: Arial, sans-serif; text-align: justify;">In recent months, many of our
managers, buyers and followers have been asking about “the latest" thing
to pop up in storage auctions - “Online." Due to the variety of questions
and myths surrounding the issue, we decided to give you our opinions on the
pros and cons.</span></div>
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<span style="font-family: Arial, sans-serif;">Storage Auction Experts is in a unique position to offer some
advice on the subject. Why? It's because we are one of the very few companies
to offer both types of storage auctions. A few businesses offer online storage
auctions exclusively. Naturally, when advertising them, these companies make
their service sound most modern and convenient. These companies show only the
benefits of online services versus live auctions, and none of the negatives. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">On the other side of the coin, the vast majority of storage
auction companies offer only live auction services. Like the online companies
they only give the value in live auctions.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Storage Auction Experts has conducted thousands of live auctions;
however, because of the demand, we have recently expanded into the online
auction business. Our company offers the best of both worlds, giving our
managers the best information on the best type of auction for their unique situation.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">One of the arguments for online auctions from a competitor is
there are “no crowds to deal with.” This can be a positive or negative
depending on the situation. If a manager does not like crowds or is intimidated
by having people on their facility then an online auction may be the way to go.
<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">The same competitor discusses “liabilities” in having large crowds
on the facility. However, in researching the issue, Storage Auction Experts has
not found <b><i>one instance</i></b> of a storage facility being sued by an
injury occurring during an auction in California. This “liability" is
nonexistent and therefore <b><i>NOT</i></b> a “benefit.”<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">One of the positives of a large crowd is the intensity of the
bidding that often takes place. Buyers are competitive and often battle with
each other in an effort to gain control of the storage unit. Others often get
caught up in the frenzy of the bid and excitement of the auction. Here's the
proof in the pudding: would buyers rather have small crowds or large crowds? <b><i>All</i></b>
buyers know that they would rather have a small crowd rather than a large crowd
because they can get better prices. With large crowds the prices are often
driven higher and faster. Online may have lots of “views,” but this doesn't
equate into lots of “buyers.” One online company brags of “thousands of
bidders.” That's not quite true. Thousands of watchers are closer to the truth.
If a bidder lives in Utah, what are the chances he's bidding on a unit in
Florida? The true bidder number is determined by the distance, convenience and
the value. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Another argument is that online auctions have a start and stop
time that is guaranteed. This is true. Although other companies have had issues
with “lateness,” Storage Auction Experts auctioneers pride themselves in an on time
schedule. That's not to say we're not sometimes late. But, with our scheduling,
contacts with managers and relationships with our buyers, they realize when we
occasionally do run behind schedule they know the reason.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">One of the fun things about live auctions is the “unknown
factor." This is the treasure hunt aspect of buying storage units. Buyers
will often bid higher anticipating the hidden treasure possibility. Ask any
buyer who has seen a partially hidden safe. With online auctions photographs
are often taken of opened containers, jewelry boxes, totes and other sealed
objects in order to try and obtain the highest price for each storage unit. By
opening containers this removes the unknown possibilities and actually hurts
prices. Buyers will bid on a closed jewelry box not knowing what is inside. If
the box is opened, the mystery is removed as well as the gamble. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">In addition, some buyers are an extremely suspicious breed. It is
their common belief that if someone was to open a jewelry box and see a
valuable piece of jewelry, this jewelry would “vanish” before the inventory
pictures were taken. This is a common suspicion with no finger-pointing at any
business or competition. Buyers would rather gamble with the unknown (and
untouched), than trust someone they don't know. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Buyers also know that if you want to sell something, you show it
in its most favorable light. On eBay, vendors show multiple photographs of
individual items to show the good, bad and ugly. With online auctions, a
missing dresser leg, or a huge tear in a picture may not show up in their area
photographs. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">At Storage Auction Experts we obtain the names, ID numbers, resale
numbers, addresses and phone numbers from the person,<b><i> in person</i></b>.
If and when a problem arises, Storage Auction Experts is able to deal with
these people directly. Although there's a remote possibility of false
identification, this is greatly reduced when dealing with a person
face-to-face.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Most of identity theft and stolen credit card issues occur online.
How do we know? Before becoming an auctioneer, I was in charge of the Identify
Theft/Fraud unit at Modesto Police Department in California. He's seen more
than his share of these issues and has conducted seminars and lectures about
Identity Theft. Online theft extremely exceeds “in person” identity theft. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Let's suppose a purchase was made with stolen credit cards or a
stolen ID, online auction companies have very little recourse. Who are they
going to investigate? What Police or Sheriff’s department has jurisdiction? A
year and half ago, Storage Auction Experts was defrauded in Kingsburg.
California. We took the suspect and his wife to small claims court and were
awarded $1850 settlement against him. It was only because we had had
face-to-face contact with this person (who provided us with a false name) that
we were able to follow up and win a judgment against him for the Kingsburg
facility and for Storage Auction Experts. [Fresno County Superior Court case#
12CESC00785]. This would not have and could not have happened if the auction
was conducted online.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Here's a another reality in the online world. Who are you bidding
against? Is it a “robo-bidder,” or a real person? If you ran an online company
and after inventory, knew a unit was worth $500.00, why would you let it go for
$20.00? You could have an automatic bidding set up to drive the prices. Or,
maybe you would have your cohorts bid it up. If you lose it, your price was
met. It you win it, you got a bargain. A win-win. Don't kid yourself into
believing this doesn't happen. At a live auction, an auctioneer could have a
cohort, but that person sees everything the other bidders see. There is really
no advantage. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">What happens to those garbage units that every facility has on
auction day? I can't count the number of $1.00 units I've sold to the extreme
delight of the management. Will online companies take pictures of this unit and
try to sell it? Of course not. Their only option is to tell the manager it's
their problem. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">How about the simple problem if an online buyer doesn't clean out
the unit or abandons it? Storage Auction Experts deals with this situation in
several different manners. Online auction services don't have the same options
open to us. We personally guarantee satisfaction on unit clean outs. If Storage
Auction Experts sells a unit at an auction, we will clean out the unit if the
buyer doesn’t (except hazardous materials).
<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Another important issue regarding online auctions is the
settlement of the bill. An online competitor of ours took over a site in the
Central Valley of California and conducted an adequate auction. At the
conclusion of the auction, the managers (and later the owner) realized they had
a dilemma The online auction company would not settle up on the outstanding
account until they received their payment at the end of the following week. The
issue? Who is now the lawful possessor of the storage unit that had been
through the lien process, but not paid for? The management did not want to
continue to bill the previous tenant, as the unit had been sold. And, they
couldn’t take it off the books either, as the account was not settled. After
two auctions of paperwork “nightmares,” the facility came back to us.</span><span style="color: red; font-family: "Arial","sans-serif"; mso-fareast-font-family: Arial;"> <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Online is not all negative. Occasionally a storage facility can
benefit from these services. One is isolation. A facility in Susanville, a
small community located several hundred miles away from other towns and cities
could benefit by showing units to potential buyers that would not travel those
distances for a live auction. Most facilities however, are located near
populous areas, making it easy for buyers to follow the auctioneers throughout
the day. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Another benefit with online auctions is if the facility encounters
a unique situation. Recently a small foothill facility opened up two storage
units containing piano repair equipment. The uniqueness of this equipment may
have found additional bidders with proper online networking. Instead, this
equipment went to the highest bidder in the area.<o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">Storage Auction Experts believe that online auctions do have a
small niche in the world of storage auctions. Online auctions (as a competitor
claims) are <b><i>not</i></b> the “future of the storage unit sale industry.”
Some things are just better suited for being done in person. Here's an example:
Would you rather buy a car in person or online. As a seller, you get more views
and potential buyers, when it comes to the sale, very few buyers’ trust 100%
what they see online. In the end, buyers need to lift the hood, kick the tires,
smell the interior and then fire it up. It's the same with storage units. If
you don't trust what you're seeing in photographs, you probably will spend
less. <o:p></o:p></span></div>
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<span style="font-family: Arial, sans-serif;">We hope this offers a brief look at the benefits and negatives to
both types of auctions. Storage Auction Experts is continually looking for the
newest and latest ideas. While online auctions have their place, for maximum
return, live oral storage auctions are still the BEST way to go!<o:p></o:p></span></div>
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<br /></div>
<div class="MsoNormal" style="text-align: justify; text-autospace: ideograph-numeric;">
<span style="font-family: Arial, sans-serif;"><b><i>Craig Plante, Auctioneer</i></b></span></div>
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<span style="font-family: Arial, sans-serif; font-size: x-small;"><i>Storage Auction Experts</i></span></div>
Storage Auction Expertshttp://www.blogger.com/profile/15697367001764015335noreply@blogger.com4tag:blogger.com,1999:blog-1258468433337633537.post-76936806082640615242014-04-08T09:16:00.001-07:002014-04-08T09:16:02.534-07:00Storage Auctions: Who needs a Bond?<div style="text-align: left;">
<span style="text-align: justify;">Did
you know to perform a legal mini-storage auction in California; the person
doing the bid calling must have an auctioneer’s bond? According to the Civil Code 1812.600, a
person who either calls for bids or make offers for the purchase of goods at an
auction is required by California law to have an auctioneer’s bond.</span></div>
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Many
acting as auctioneers believe they can “do” the job, however, history has
proven otherwise. These “auctioneers” operate with little or no regard to legal
repercussions. A person driving without
a license may feel they are more than adequate to drive. In the same manner, a non-bonded auctioneer
may feel he is capable of calling an auction. In reality, both the unlicensed driver and the
non-bonded auctioneer don’t fully comprehend the perils involved conducting these
illegal activities. <o:p></o:p></div>
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Codes
pursuant to California Statutes, Business, and Professions Code, Section 21700
and Title 2.95 Section 1812.600-607, are required to obtain an auction bond. Not having an auction bond will create
potential lawsuits. Even the most innocent of mistakes can result in huge
losses. Cases of non-bonded auctioneers conducting auctions have increased. Lawsuits tie up valuable time and money for
the owner/stockholder/manager, of these storage sites. <o:p></o:p></div>
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In
the past, not having a bond may have been overlooked. Currently, lack of an auction bond is an open
invitation to take you, the owner/manager, to court. Sadly enough, the sole responsibility
falls on the storage site to prove why it acted “recklessly”, by not having a
bonded auctioneer that would have recognized the error immediately. <o:p></o:p></div>
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Attempting
to conduct auctions without education skills, will invariably result in
catastrophe. It takes years to acquire the skills of a truly qualified and
bonded auctioneer. The chances of lawsuits can be minimized dramatically by
simply using the services of a professional storage auctioneer.<o:p></o:p></div>
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When
choosing an auctioneer to conduct your storage auctions, make sure they have
experience in selling storage units. Since the TV shows have aired, several
people think they can do what the TV makes look easy. Also ask to see their
bond number, liability insurance and E & O insurance policies. If you are
using an auctioneer to help shield you from lawsuits, make sure they have the
proper tools, paperwork, insurance and education to execute this need.<o:p></o:p></div>
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A
storage auction expert will focus their attention on drawing the right crowd to
insure the units are auctioned for the maximum return for your
establishment. They will under all
circumstances maintain total crowd control.
If you ever had the displeasure of being engulfed in an unruly crowd,
you immediately understand this alone can justify having professionals on site.
By using a professional, you are assured the work will be done in a timely
manner, within on budget, and above all, properly.<o:p></o:p></div>
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There
is an old proverb that says, “A wise man will change”. Hopefully, this article
will enlighten those “auctioneers” who are attempting to work without a bond
risking potential violations. Only
those who have been trained and bonded have the ability to avoid these legal
pitfalls. It is of the utmost importance
you are fully aware of the responsibility you accept by not being bonded if you
are conducting your own auctions! <span style="font-size: 16pt;"><o:p></o:p></span></div>
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<span style="font-size: x-small;"><b>Written by:<br />John Cardoza, CAI, BAS, CES,
CAGA<br />Owner, Storage Auction
Experts</b></span><br />
Storage Auction Expertshttp://www.blogger.com/profile/15697367001764015335noreply@blogger.com4tag:blogger.com,1999:blog-1258468433337633537.post-71579334856823085562014-03-10T11:38:00.002-07:002014-03-10T11:38:39.097-07:00Obtaining Maximum Profits from Storage Auctions<div class="MsoNormal" style="text-align: justify;">
Most people involved with the storage
business would agree the most challenging part of the business is how to handle
the 7 to 10 percent of tenants who don’t pay rent as agreed.<o:p></o:p></div>
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Like all areas in life, there is
no one right answer for every situation.
In the storage business, they have a process designed to answer from a
legal point on how to proceed. These
answers can be obtained by looking at the California Statues 21700 or you can
talk to a lawyer (preferably one who belongs to the CSSA) to know the correct
way to do the lien.<o:p></o:p></div>
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Assuming all the legal paperwork
is accurate, now decisions must be made on how to get these non-paying units
empty so they can be replaced by tenants who will pay for their unit.<o:p></o:p></div>
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Some Mangers are worried if they
auction a tenant’s goods off, they will end up in court with huge
lawsuits. If the paperwork trail is
followed to the letter of the law, this won’t happen. Most people are aware that Paris Hilton had
her items auctioned in November of 2005.
For whatever reason, payment between Paris and the storage site did not
happen. After the auction, she hired the
best lawyer money could buy to try and get her items back. Since all the paperwork was correct and the
person conducting the auction was bonded, she was not able to get any of her
property back.<o:p></o:p></div>
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Another common misconception
about auctions is they don’t bring enough money and it would be better to
settle with 20 percent and get the tenant out.
Occasionally this is the best method, especially after doing inventory
and the contents have value only to the tenant.
However, usually it is better to your bottom line to stand firm and get
100 percent on what is owed to you. Why
would this action be better? Let’s look
at some basic math. For example, from
the thousands of units we sold over the years, three out of five units the
people will pay in full. Should these
five units be $1,000.00 each, and you settle all five you would receive
$1000.00. Should the average pay, you
would collect $3,000.00 from the full pay, and have two units to auction. <o:p></o:p></div>
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Using a Professional Storage
Auctioneer, even after paying his commissions, you will net more than a storage
manger doing their own auction. A
Professional Storage Auction Company will have more buyers and handle those
unique situations that auctions can bring. Should an Attorney get involved for
any reason, having a Professional Storage Auction Company on your side can be
priceless. It also sends a message to your delinquent tenants you are serious
about getting paid which brings in more “past due” money because of your
auction date.<o:p></o:p></div>
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As a businessperson, it sometimes
is confusing why a company that hires an attorney for their legal work, an
accountant for their financial work, a groundskeeper for their yard work, a
computer tech for their computer work and then try to do their own auction
because they think it saves them money. (It doesn’t) The bottom line is what is most important in
business is to make a profit (and not get sued) and not settling just for settling
sake is something everyone should reconsider.<o:p></o:p></div>
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John Cardoza, CAI, BAS, CES<o:p></o:p></div>
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Storage Auction Experts<o:p></o:p></div>
Storage Auction Expertshttp://www.blogger.com/profile/15697367001764015335noreply@blogger.com3