The Underground Economy of Storage Auctions

The Underground Economy of Storage Auctions

If you don’t want to read it, you can watch this video.

You hear a lot of stuff about what you can get out of a unit. People say things like, “There’s nothing in there but trash.” There’s something that very few people talk about and that’s the underground economy of storage auctions.

Ninety percent of what happens with storage auctions, nobody knows. What you see on TV represents a very small percentage of what people are pulling out of these units. I’m going to give you some of my experiences. Some of the things I found are illegal to sell, and I didn’t sell the stuff. Prescription drugs and machine guns were two of those.

Say I wasn’t a standup, righteous type of guy. There are many ways to sell this stuff. Let’s break it down by markets. When people think of the economy, they think of Main Street and Wall Street. There’s a whole other second and third level of the economy that operates totally independent of what’s going on with the main economy. The storage auction world is part of that.

I’ll give you a great example of something that is a little tricky. I never sold alcohol that I got out of a storage unit. If you don’t have a liquor license, you shouldn’t be selling it. You can have a party or something and you can pour it. I thought, I can’t sell it, but I can trade it or give it away. There’s a big difference there.

I found a unit with some Jack Daniels. This dude was a trip. I needed a service from a friend and I paid him in alcohol. People will work for alcohol. Believe that.

I needed quite a few services and I had about four cases of Jack Daniels. It was very nice stuff, very smooth. I don’t drink a lot. So, I actually made money with something I couldn’t sell. That’s how the underground economy works.

There are so many things you come across in a storage unit that you can make money from if you have your thinking cap on. I’m not saying you should break the law. I never sold the weed. I never sold the pills. I have an aversion to jail. I’m not selling controlled substances. There’s too much risk.

Now how do you really make this work for you? What I see in storage units is people find one or two items they think are worth a lot, then they run to an appraiser and get it checked out. You should be able to trade or sell virtually everything you get in a unit. If it’s trash or extremely low margin, then you have to throw it away and move on.

One of the things that drives me crazy in the TV shows is the destruction of saleable merchandise. I don’t know how many frigging times I had to go get a knob and fix something, paint something or build something to just get my money back on a unit or to actually squeeze out a profit.  

When I see somebody destroying something with careless disregard that I could have sold for $100 or $150, it’s some bullshit. The storage auction business is extremely hard. You work for every penny. Watching people do that gives people the wrong idea about this business. You should never break anything or casually put it aside, because you may need it later for your profit. That’s gospel. I watched Auction Hunters one day and I was shaking my head when they were breaking things.

There are things you get out of storage units that you can never get from normal channels. That’s one of the cool things about it. If you’re out there a lot, it’s going to happen to you. How do you handle getting something super sensitive? You don’t tell anybody. That’s why I was very fortunate to have the partner that I did. We came across a lot of stuff that we didn’t know what to do with at first glance. It was a bitch sometimes.

For those of you who are anti-government types and have a cabin up in the hills stuffed with ammo, water, and dried food stuff, you might want to check out some storage auctions. You can find things you’ll want. I don’t believe things are going to get that bad, but I could be wrong.

I think the recession is alive and well. There are a few people doing well, but overall, a lot of people are sucking wind. Think in those terms.

For me, the biggest joy of storage auctions was the mystery. It wasn’t about the money. It wasn’t the money that had me in my warehouse at two or three AM reading journals. Buying a storage unit is like being able to go through your neighbor’s house, opening every cabinet and reading every letter. That’s something for you to think about.

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