Site peddles government surplus
- By Dibya Sarkar
- Oct 26, 2000
When Georgia found itself with seven truckloads of surplus copy paper,
it turned to an Internet auction company that deals with excess.
With an online network of 100,000 traders scattered across about 100
countries, Washington, D.C.-based Liquidation.com facilitated the sale of
Georgia's 144 pallets of surplus paper. Originally valued at about $134,000,
the paper fetched nearly $42,000 — a higher price than what Georgia hoped
to get, company spokesman Hunter Hoffman said.
Liquidation.com, a marketplace for buying and selling surplus business-to-business
goods, is trying to expand into the government arena. The company, Hoffman
said, is negotiating contracts with three other states and the federal government,
and is pursuing municipalities, too.
"Surplus as a separate [revenue] entity is still being largely overlooked.
[Governments are] looking at millions of dollars of unrealized money that
can go back to the taxpayer," Hoffman said.
He said Liquidation.com has thousands of traders worldwide, giving sellers
a better return. But the company also offers assurances. For instance, the
company only lists qualified buyers and sellers that register with the site.
Buyers can request a sample of the product and inspect it before making
a bid. And Liquidation.com also facilitates shipping for the seller to the
buyer that can be tracked through the World Wide Web.
Before a sale is completed, a buyer has 48 hours to inspect the surplus
merchandise. In the meantime, Liquidation.com holds the buyer's money in
escrow before the buyer authorizes its release to the seller.
The company charges a 10 percent fee for all successful transactions,
Hoffman said. For example, in the Georgia deal, Liquidation.com received
about $4,200, which was deducted from the $42,000.
Hoffman said the company wants to present itself as a "business service
provider" whereby its software is integrated with a client's electronic
procurement system. Instead of the client contacting Liquidation.com each
time it has a surplus item it wants to sell, he said the software would
automatically showcase the item after it is designated as surplus.