How to Plan a Going Out of Business Sale

A going out of business sale is often a sad, but necessary reality. If you want to recover some of the funds you have locked in your stock you will need to slash and cut prices.

Here is how to run a going out of business sale in an orderly, legal, and productive way whether you are trying to sell your business or close down a small business that has stopped creating profit.

Difficulty: Challenging

Instructions

1. Check with legal counsel.
   
   Whether you run a small business or a large operation you should already have legal counsel to whom you can turn. Many states have specific notification requirements before a going out of business sale can be held, and restrictions as to the manner in which it is held. Make your lawyer your first stop.

2. Make sure your accounts are in order.
   
   Check with your small business book keeper, CFO, or whoever runs the books for you and your business. Consult with them as to what your revenue targets should be and the general margin you have on your products.

3. Be faithful to loyal employees.
   
   Consider notifying your employees in a particular order of rank, length of service, etc. Alternatively hold a small business or franchise meeting to give people lead time to find other work.

4. Start with small increments of discount.
   
   Your small business or franchise business has taken your blood sweat and tears. Do not give up on your margins too quickly or easily. Many people will be happy to purchase your products at ten twenty and thirty percent discounts.

5. Gradually increase discounts.
   
   As you incrementally increase discounts on your small business' merchandise be sure to advertise each move through cheap advertising means. Use road signs and other relatively inexpensive means to get the most out of your going out of business sale.
   
   * See tips below for more on going out of business sales.

Tips & Warnings

• Be sure to clearly communicate prices and price changes to all levels of employees.
• Prepare asking prices for not only merchandise but your small business or franchise's equipment and displays.
• See related articles on this page for more help.

[watersong]

on 11/12/2009 It's sad when one must go out of business, almost like a funeral. This advice seems very good to make the laying of a dream to rest go as smoothly as possible. Steps one and two seem VERYimportant - but then, so are the rest. 5*

[nancycarol]

on 11/12/2009 Well thought-out tips in How to Plan a Going Out of Business Sale. Thanks and *5