When a company liquidates, it simply does whatever it can to eliminate all of its in-store and warehouse inventory off its books in exchange for cash. Not only does it do this by reducing prices* for customers and bringing in outside help (liquidators) to develop inventory, placement, and exit-pricing strategies, but other wholesalers come in and try to buy up whatever they can.
*However, just because a store is under liquidation doesn't mean that you're about to get great pricing.
As a matter of fact, I stopped by CC last weekend (on the 16th) and went over to the gaming section to be bombarded with an almost sarcastically large amount of Guitar Hero III game packs priced at a 39.99 clearance price with an additional 10% off markdown at register. Guitar controllers sold for 19.99. I waited. Today (the 22nd) 6 days later, I was a bit shocked to find the prices jacked back up--on the same inventory--to $55, with a 20% markdown. So even liquidators find ways to be slick.
So if you plan to drop in, CNN Money has a few tips you should watch for when entering the store:
First of all, you may find better prices online or at other retailers. Keep in mind that liquidators can raise prices that the original retailer already set. They can also get rid of any of any previously scheduled sales.
In fact, since ads that scream "going out of business" just attract consumers who assume they're getting a good deal, there is little incentive to actually give those big discounts…(Emphasis mine)
Yes, a going out of business sale where prices are actually raised. So generally these sales go on over the course of a few months, so you'll have some time to compare the "liquidation price" online. And don't bother going to the circuit city website. It's gone. You should (as I do with most electronics, games, books, etc.) consider looking at http://froogle.google.com and Amazon and comparison shop.
You may also want to give it some time. Circuit City's liquidation will continue through the next few weeks, and the longer it takes to empty the store, the cheaper the products will become. It may allow you the perfect opportunity to get some good stuff for a decent price.
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An electronics store was going out of business about a year ago when I was living in Hawaii (sorry, can't remember what store). We went in thinking I could find a good deal on a new digital camera. Boy, was I shocked. The prices were higher there than at most other stores. When I asked the guy at the store about it, this is exactly what they said. They mark up prices and hang huge signs with the hope that people won't notice the huge increase. I couldn't believe it. Thank goodness I didn't actually purchased anything. I am now very weary to go to those nice going out of business sales.
On that same note, I hate it when jewelry stores (I am sure other stores as well but I only know of jewelry stores) have that nice going out of business sign posted when they have no intention of ever going out of business. There are 2 jewelry stores like that here in Colorado, in the same mall! When I mentioned I was sorry they were going out of business, they told me they weren't and never were. It is all a ploy just to bring people in.
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