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When it comes to selling the contents of a customer’s storage unit, the onus is on the storage provider (the seller), to prove they took reasonable steps to secure the best possible sale price, to not only minimise their own loss, but their customer’s loss as well. We talk to Grant McNamee, Owner/ Director of iBidOnStorage Australia and Director of iBidOnStorage UK & EU, about the risky business of selling abandoned storage goods:  

LET’S JUMP RIGHT IN. IS THERE A GOOD WAY TO SELL ABANDONED GOODS?

Over the years, storage providers have used several different selling methods, some successful, others not, but there has always been an underlying risk that if they stray too far from the prescribed best practice, they could be facing litigation. Over the years I’ve seen sellers take on so many unnecessary risks that could easily have been avoided. 

RISKS? CAN YOU ELABORATE?

Well, to give you some examples: 

1. Some storage facilities are in rural towns. When it comes to selling up defaulting customers, the remoteness of their business makes it difficult to find a suitable buyers’ market, so they simply sift through the contents of the storage unit, share any items of worth amongst friends and family, then dump the remaining items. Quick, easy, AND risky.

2. Other storage facilities sell their unpaid storage units to second-hand dealers in the local area. An example scenario is where the second-hand dealer requests the facility remove any items of no commercial value prior to them buying the unit. This saves the second-hand dealer having to sort through everything and disposing of items with no value. Once again, very risky.

3. One final example and actual event was a storage facility who would sell customer goods via a Tender Process, where they had several local buyers who would visit the facility, view the contents of the storage unit for sale, then make an offer to purchase. Naturally, the highest bidder would win. In this example, a buyer came in and instead of making an offer, they asked staff what amount the customer owed them in unpaid rent. An agreement was struck, where the storage operator accepted to sell the unit at the debt amount outstanding. 

In all three examples, sellers have made critical errors, including, but not limited to:

- Not taking “reasonable steps” to secure the best possible price

- “They” decided what did and did not have commercial value

- “They” set the price for sale

- “Their” actions have shown them trying to mitigate their own loss, but not their customers loss

YOU MENTION EXAMPLE THREE BEING AN ACTUAL CASE. WHAT HAPPENED?  

Examples 1 & 2 are occurring too, but we must recognise, some business owners accept the risk of their actions on occasion. As for example 3 - unfortunately, their storage customer returned after the sale took place. A legal battle ensued where the storage facility was deemed at fault, and held financially liable for their customer’s loss, this being to the real value of the unit contents - approximately £28,000 (or €32,000). It was ruled that in accepting an amount equivalent to what they were owed in unpaid storage rental, the storage facility had effectively set the value of the unit’s contents, not the market. A costly error.

WHAT ADVICE DO YOU HAVE FOR OPERATORS DEALING WITH ABANDONED STORAGE?

Use a storage industry specific platform like iBidOnStorage. iBidOnStorage is a public auction website with a large and growing buyer’s market. It allows storage operators to show:

- They sold the goods to an open market (leads to “reasonable steps”)

- The market set the sale price (the value), regardless of the final sale price

- That the highest bidder made the purchase

ANY LAST WORDS?

If you’re a storage operator in the UK or Europe, let me ask: How are you selling the contents of unpaid storage units? Are you taking unnecessary risks? What can be done to mitigate these risks? Join the growing number of storage operators using iBidOnStorage to get back their valuable storage space.

#DontRiskIt

Download full Interview here