A process where a business sells its assets to convert them into cash. This typically occurs when a company is closing, facing bankruptcy, or restructuring. The objective is to generate as much money as possible from inventory, equipment, and other holdings quickly. For example, a retail store declaring bankruptcy might conduct this type of event to pay off creditors.
This action benefits creditors by providing a means of recouping outstanding debts. For consumers, these events present opportunities to purchase goods at significantly reduced prices. Historically, this practice has been a common strategy for businesses in financial distress, serving as a mechanism to mitigate losses and settle obligations.
