Storage auctions have become somewhat of a spectator sport in the last few years, with reality programs like Storage Wars becoming popular. There’s speculation about what might be in a particular unit, perhaps disappointment when a unit doesn’t yield as much as a buyer hoped, but also excitement when something valuable is found.
At the center of it all is the auctioneer, a professional intermediary between the facility and the buyers. As a self storage owner or manager, it will be your job to hire an auctioneer when units at your facility go to auction. Here are some tips to help with that process.
First, it helps to know where to go to hire an auctioneer. Two great sites for this are National Auctioneers Association, which is actually an international organization serving primarily the U.S. and Canada, but operating worldwide; and GIG Salad, which allows you to hire entertainers and speakers of all sorts.
Those are good places to hire from, but you will want to make sure you’re hiring the right auctioneer. Let’s explore what to look for in a candidate.
Make sure that your auctioneer candidates have experience with self storage auctions. Every industry has its own auction rules and standards. Suppose a unit clearly doesn’t have as much value, once opened, as an auction winner expected. The auctioneer should know what to say to that person. They should also be able to explain the legalities of a storage auction to participants when the auction starts. For example, what should a winner do if they find legal files in the unit? What if they find something illegal inside? The auctioneer will be in charge of the show, and should be well versed in these contingencies.
When you contact an auctioneer organization looking for an auctioneer to hire, ask if there are any customer reviews for those they recommend. You could also ask other, local self storage managers whom they have used and recommend.
This will help you find an auctioneer skilled at their job, and with a positive attitude, someone you and your staff will be happy to work with.
Your auctioneer must also be licensed and bonded. Look up your state’s self storage auction lien laws, or consult with a lawyer. Why? If your auctioneer isn’t licensed and bonded, a former tenant whose unit gets sold in auction can sue your facility for an illegal sale, and will most likely win.
The auctioneer needs to keep records of all sales, and, of course, you should get copies. It’s especially important to have name and contact information for each person who purchased a unit, including which unit they won. You’ll also need information on sales taxes collected. Accurate records help with your facility’s taxes, and can protect you if any legal challenges arise.
After you’ve chosen an auctioneer, create a contract between them and you for the auction and sales. In fact, we recommend you create a standard contract for all your auctions. This will save you time in the long run.
Consider hiring a lawyer familiar with your state’s self storage lien laws and with auctions to help draft the contract. There’s much it will need to include, including the date, time, and location of the auction, whether the facility or the auctioneer will collect the sales tax, terms for the auction, such as if facility staff can bid, and more.
We hope this helps you to hire a top-notch auctioneer, one who will ensure fair auctions, and maybe even contribute to your facility’s good reputation in your community.