BPI Wakefield will be closed for collections on Monday 27th May for the bank holiday.

Live Auctions


News Article

Advice for disposing assets and raising funds

Raising cash and capital for businesses can mean the difference between insolvency and staying afloat; selling old or unnecessary plant & equipment can be a quick and easy way to raise funds. 

With over 1.6 million businesses receiving Coronavirus business loan schemes worth over £80 billion¹ since the start of the pandemic, we spoke to reputable insolvency practitioners to provide a guide on raising funds to increase business growth and payback support packages taken over the last 18 months.  

How can selling assets support a business?

It’s almost needless to say that selling certain types of assets can be very useful for a business at any time, not least of all as part of its environmental policies. Charles Brook, partner at insolvency practitioners, Poppleton & Appleby says, “Redundant assets such as furniture or equipment (and even stock) take up valuable space and may even become a hazard or a burden to get rid of at a future date. Selling these whilst they are still of use to someone is a practical way of raising funds, tidying up, possibly even improving a working environment, and demonstrating Green Credentials.”    

What should be your main considerations when selling business assets?

 Managing Director at Forbes Burton, an insolvency and business consultancy, Rick Smith advised, “Selling assets is something many businesses choose to do to help inject much-needed cash into a business. However, we often see that many companies neglect to look at how they sell them. If a business has already gone into the insolvency process, then goods need to be sold at market value, not undersold and particularly not at a reduced rate to directors. “ 

Online auctions allow you to reach a larger pool of buyers and sell quickly and efficiently. By selling by auction, from the moment you issue an instruction for equipment to be listed online, it will sell within a selected short period, often selling 3-4 times faster (on average) than selling privately. Not only does it allow for a speedy process of sales, but it also enables you to meet a widespread number of interested bidders, creating an opportunity to sell the item for an amount significantly more than expected.” 

How to liquidate a closing business’s assets 

The process of liquidating a closing business’s assets will depend on whether the company is solvent or not advises Rick: “If the business is solvent, then the director can sell the assets themselves. However, it may be more tax-efficient to undertake a Members Voluntary Liquidation – this can only be carried out by an insolvency practitioner.  

“Conversely, if the business is insolvent, then the directors should seek to appoint an insolvency practitioner to undertake a Creditors Voluntary Liquidation – this is where the assets are sold, and the proceeds are distributed to the creditors. It’s one of the most efficient ways to close a business and satisfy at least a portion of the monies owed.” 

BPI Auctions was recently appointed by Michael Steele & Co to support the online auction of 443 lots after Amtech Development UK Ltd ceased trading and went into Administration.  

Andy Cromack MRICS, Director of BPI Asset Advisory said, “It is important to understand the role of the auction in the Insolvency Process. A well-advertised and fully marketed online auction offers full transparency on assets sales for Insolvency Practitioners; guaranteeing market value is achieved and ensuring they have a robust account of how and where assets were disposed of” 

You can check out the full case study here

How to choose a reputable insolvency practitioner 

Choosing the right insolvency practitioner for your business will determine how effectively you may be able to achieve the desired outcomes for the company. Charles advises to speak to your accountant first, “If your accountant doesn’t have any existing relationships with a Licensed Insolvency Practitioner that they trust, you can look visit GOV.UK or R3 (The Association of Business Recovery Professionals). 

“Always try to speak directly to a Licensed Insolvency Practitioner that is local to you and has the requisite experience and training to help. Licensed insolvency practitioners are trained and qualified to assist, and they are independently regulated by one or other of several bodies which are themselves overseen by The Insolvency Service.” 

Rick also highlights how research is critical when choosing the best insolvency partner, “Read case studies of what they have handled before and choose one that has dealt with businesses of a similar size. Some of the top insolvency practitioners, while impressive, deal with the likes of blue-chip companies and multinationals, so attention towards SMEs can be patchy.”  

Plan for the post-pandemic world 

 With the pandemic upending the global economy, many businesses spent the past year trying to achieve or maintain stability. “Future-proofing can sometimes seem difficult when business is good; many businesses simply don’t look forward to unanticipated periods of downturn. It might not be the most thrilling use of time, but planning and deep monitoring of market conditions can mean you are ready for a variety of scenarios,” highlights Rick.

Saving costs should always be a priority in business planning. When selling assets via an online auction, you incur considerably less cost by not setting up an in-person auction event and reducing advertising costs you would usually pay when promoting a sale.

 How can BPI Auctions help you? 

 Selling used and surplus equipment and machinery through online auctions is an effective and efficient method for businesses to recuperate capital from excess or redundant items and compliments your overall asset recovery process. 

Make sure to follow us on Twitter, Linkedin, Facebook and Instagram to keep up to date with our latest auctions and insight.

Get in touch about selling your business assets.

Our Partners

With your BPI
account you can: