It all started back in 2005. At first, before we became Transition Squad®, we started as a service to help people sell homes privately. Our first client had a mother who had dementia. It was really a Transition Squad® type client, but we weren't doing that at the time. Our founder had gone through his own dad's transition and many of his friends were also starting to go through it. Then, a light bulb went off!
People really needed help at such a time. So he decided to pivot the business' direction to a senior downsizing company. Without much experience in the business, the first few projects helped with organizing, packing and move management. However, the biggest challenge clients had was "what do I do with all my stuff?"
After scratching our heads wondering how other companies handled this (back then, there weren't many companies to compare to), our research determined that the few people out there in the industry were simply packing everything up and shipping it to auction houses. So that's what we did, after all, why re-invent the wheel or so we thought. We then found out that in most cases, buyers at these auctions were paying pennies on the dollar and then the auction house was taking their cut. They had difficulty selling big items so they were disposed of, the cost charged against the seller's proceeds. As a result, our clients were getting cheques back for approximately $20 for their whole houseful of memories, which didn't even cover our charges to pack up or ship. Ridiculous! "Surely we could find a better way!"
So we set out to design a process which would take away the burden, find a good home for our clients' belongings and also maximize their selling price. We were determined, however, not to be a liquidator like many other companies in this space.
The most inefficient and expensive parts of the process were the packing and shipping. We realized that it would be much more efficient and cost effective to bring the buyers to the items rather than sending the items to the buyers. So we decided to start holding sales right from the clients' homes. There would be no packing or shipping costs as buyers would take their purchases with them and the customer would get much more immediate cash to cover the costs of disposing of anything that was not sold. Our first sale in Scarborough was packed with buyers. The client had come home from Spain to handle his mother's affairs. He couldn't stay long so he just gave us his keys and we handled everything from selling the contents to managing repairs to the home before putting it on the market for sale. We sold well over half of the items and generated more than enough to cover removal of the rest. The customer was thrilled.
However, after every estate sale, there were still some nice things remaining that had good value. So we built an online auction system to do "flash" auctions of any leftover items. Winners could pick up their items along with those who had purchased big items at the sale that they could not take with them.
Over the years, our estate sales and online auctions became a very effective tool. The on site physical sale from the weekend typically cleared out 50, 60, 70% of the home, depending on what people had. Then the post-sale online auction cleared out another 10, 20, 30%, thus leaving very little to be cleared out, which meant huge cost savings. In most cases, our clients were receiving more from the sales than the cost of removal so they were in a positive position without having to do any work.
However, there were often still some nice things remaining after the auction. So we visited many consignment stores in the area to ask them to work with us but didn't get much cooperation. Heck with it, we set up our own store to help extend our clients' selling period and hopefully get them more.
Our research showed that most consignment stores focused on high end items only and were quite pricey. They had to be because that was their only revenue stream and they had to cover the cost of rent, staff and overheads. They needed to make as much as they could on every item. On the other end of the spectrum, there were thrift stores where items were much lower end and the biggest focus was on inexpensive, used clothing. There was nothing in the mid-high end category, where most buyers are. That also happened to be where most of our buyers and sellers were.
Once the doors opened to our own store, requests from the public started coming in almost immediately to take their items on consignment. Demand grew and so did the need for additional space. We rented multiple storage lockers until our lease was up.
In 2015, we moved into a 6,300 sq. ft. warehouse and store to accommodate the demand with a five year lease. Over those five years, a lot changed. The internet drove many bricks and mortar companies out of business, retail was dying, labour costs shot up and the biggest effect was that real estate prices and rents literally doubled.
In 2018, we decided to replace our consignment store with a consignment auction house which more closely aligned to the estate auctions we were doing. We were still in the consignment business, just not in the retail store business. The throughput in our consigned inventory tripled. We were able to take advantage of that new direction for about one and a half years for the duration of our lease. However, at renewal time, with rents doubling for space, we decided to take our Consignment Store and Auction House totally virtual which would allow us to dramatically reduce costs of rent, staff, and overheads while saving clients the costs of moving their items to our location. It also allowed us to start a dealer program to take advantage of the portability of our solution into multiple markets.
So today, our Services division has our squads going into people's homes and conducting our auctions from there when there is enough to sell, and our Virtual Consignment Store & Auction House when there is a smaller number of items. Our vision is to expand our model of online estate auctions and consignment into multiple markets throughout North America. Wish us luck!