A fire sale is a sale where goods are sold at extremely low prices, often below retail or wholesale value, to clear out merchandise quickly. It can be held after disasters or during bankruptcy proceedings, and can be a good opportunity for bargain hunters.
A fire sale is a sale in which goods are sold at extremely low prices, usually well below the retail value and sometimes even below the wholesale price. As a general rule, the goal of a fire sale is to get as much merchandise out the door as possible, with the store owner sometimes willing to take a small loss to do so. Firefighter sales are sometimes billed as “closing out” or “out of stock” sales, reinforcing the idea that goods are selling at very low prices and that consumers must act quickly if they are to get in on the action.
This term is a reference to sales held by stores after literal fires. Historically, when a store’s merchandise has been damaged by fire, the choice has been to sell it or throw it out. Sometimes goods would be perfectly usable, if they were a little smokey, and better off making money than discarding everything. Until the goods cleared customs, the company would not be able to make repairs and replenish, so it had an incentive to sell everything as quickly as possible.
Fire sales can also be traded after other disasters, such as floods, building collapses, and so on. While not all goods are salable, minimally damaged goods can often be picked up cheaply at a fire sale. This is especially true in cases where consumers are willing to repair minor damage or live with items that smell of smoke for a few months. Often, the shops already get the full replacement value from the insurance company, so selling the fire just gives the business a little extra capital.
People also use this term when companies sell their products during bankruptcy proceedings. Companies filing for bankruptcy hold fire sales to reduce the amount of their assets and to get cash ready to handle bankruptcy. Some unscrupulous business owners may even use a fire sale to convert assets into cash that can be moved or hidden, allowing them to pocket some funds to help them recover from bankruptcy.
A fire sale can be a great way to score good deals, especially for people who are willing to haggle and haggle a bit to bring prices down even further. Firefighter sales are often listed in the newspaper or advertised in the media, as the company wants to get as much exposure as possible. Attending the fire sale on later days tends to yield better deals, although the selection will be more limited.
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