How online liquidation auctions work: proxy bids, soft close and fees

What is a liquidation auction?

A liquidation auction sells surplus retail goods to the highest bidder: customer returns, shelf pulls, overstock and salvage that stores and their return programs need to clear. Goods are grouped into lots, from one case to a pallet, several pallets or a truckload. The buyers are mostly businesses: bin stores, discount and flea-market sellers, online resellers and exporters.

Auctions suit this inventory because nobody knows exactly what a pallet of mixed goods is worth. How much of a manifest works and sells depends on the category, the condition and your sales channel, so bidding sets the price lot by lot. Most liquidation sales now run as timed online auctions: every lot has a published close time, and the lots close one after another on the evening of the sale. Live webcast and sealed-bid sales exist too.

On Two Bro Sales, independent liquidators run their own storefronts and hold their auctions there. Two Bro Sales runs the marketplace, the bidding engine and payment collection, and never buys or sells its own inventory. Only verified businesses can bid, with a resale certificate a person approves first; the resale certificate guide covers that step. For the exact current rules, read How it works.

The life of a lot, from listing to pickup

Every timed liquidation auction follows the same arc. Here is one lot on Two Bro Sales, with the deadline at each step.

Before the close. Lots are open to bid as soon as a seller publishes the auction. Read the photos, the condition code and, on manifested lots, the manifest (the manifest guide shows what to check), and go to a preview if the seller offers one. Most sellers schedule auctions on Tuesday and Thursday evenings, 7 pm Eastern; each auction shows its own times.

After the close. The invoice is issued the moment the lot closes and is due within 2 business days: card up to $2,500, bank transfer (ACH) above, through Stripe. Two Bro Sales collects the payment and holds the seller's payout until you pick up. Pickup is local, at the seller's warehouse in metro Atlanta: the person collecting gives your pickup code, shows ID and signs for the lot. You may send your own carrier, but Two Bro Sales does not broker freight (see the pickup guide). Claims on manifested lots are due within 48 hours of pickup; shortages under 5% of manifest retail are not claimable, and the remedy is a pro-rata refund. As-is lots have no claim window.

How proxy bidding works

Proxy bidding, also called automatic or maximum bidding, means you enter the most you will pay, once, and the system bids for you: only as much as it takes to keep you in the lead, in the published increments, and never past your maximum. Your maximum is never shown to other bidders or the seller.

So the winner usually pays about one increment over the runner-up's maximum, not their own. Economists call this a second-price auction; it is the model Ockenfels and Roth use for internet auctions with proxy bidding. Here it is on one lot, with the real increments.

Illustrative lot: $500 starting bid, no reserve, real increments.

After the last step A is outbid, gets an alert by email and in the app, and can bid again from $1,100. Three details matter:

• Ties go to the earlier bid. With equal maximums, whoever got there first keeps the lead.
• Raising your own maximum while you lead does not raise the price, unless the new maximum meets a reserve.
• A challenger can win by less than a full increment. The price never passes the winner's maximum, so a $1,015 maximum against A's $1,000 leads at $1,015.

How a soft close works, and why sniping fails

In a hard close the auction ends at a fixed second, which rewards sniping: bidding in the final seconds so nobody can respond. The usual countermeasure, as Wikipedia's entry on auction sniping notes, is to extend the auction by a few minutes when a last-minute bid arrives. That is a soft close, also called extended bidding or popcorn bidding.

On Two Bro Sales, a bid in the last 2 minutes that changes the price or the leader moves that lot's close to 2 minutes after the bid, and it repeats until 2 quiet minutes pass. A leader raising their own maximum does not extend the lot. Windows vary by marketplace: B-Stock Supply's buyer FAQ, read on 9 October 2026, says a bid in its last 7 minutes adds 3 minutes. Each auction page on Two Bro Sales states its own spacing and extension.

Staggered soft close: lots close 30 seconds apart

A staggered soft close gives every lot its own clock. Lots in one auction close 30 seconds apart, and an extension moves only the lot that got the late bid.

Why sniping fails

• A late bid buys everyone 2 more minutes. The sniper's edge was that nobody could answer. Now everyone can.
• Standing maximums answer instantly. A snipe below the leader's maximum only raises the leader's price.
• The evidence agrees. Ockenfels and Roth found late bids much less frequent in auctions that extend automatically than in auctions with a fixed end time.

The server clock is the only clock

A bid counts when the server records it, not when you tap. Your countdown is only an estimate, and a bid sent with one second showing can arrive after the close and be refused.

Bid increments

A bid increment is the minimum step between bids. The next bid must beat the current price by at least the increment for that price, and the proxy raises you in the same steps:

Your maximum can be any amount at or above the next acceptable bid. At $1,000 the step doubles from $25 to $50.

Buyer's premium: the fee on top of the winning bid

The hammer price is the winning bid. A buyer's premium is a charge on top of it, usually a percentage of the hammer price, kept by the auctioneer or marketplace rather than the seller (see Wikipedia on buyer's premium). In liquidation the common pattern is a percentage on every lot, often uncapped, sometimes with per-lot or payment charges. One published example: B-Stock Supply's FAQ, read on 9 October 2026, puts its standard buyer fee at 10% of the final bid price, paid by wire within 2 business days.

On Two Bro Sales the fee depends on how you met the seller. If a seller invited you with their own link, you pay no buyer fee on that seller's lots. If Two Bro Sales introduced you, the fee is 5% of the winning bid, capped at $500 a lot. The invoice shows it before you pay.

Work backwards. To stay under $1,000 before pickup as a marketplace-sourced buyer, bid a maximum of about $952. The pallet profit calculator does the math, fee and pickup included.

Are auction bids binding? Yes. Here is what not paying costs

A bid is an offer to buy at the price it produces, and liquidation marketplaces treat it as binding; B-Stock Supply's FAQ, for one, says bids may not be cancelled once submitted. On Two Bro Sales a bid cannot be retracted, lowered or cancelled, typing errors included. Lead at the close, or use Buy Now, and you have bought the lot. Check the lot number, quantity, condition code and your maximum before you confirm.

Payment is due within 2 business days of the close. Miss it and the non-payment fee is the greater of $100 or 10% of the winning bid, plus a strike; an account is suspended at 2 strikes, and the seller may offer the lot to the next bidder.

A runner-up may get a second-chance offer when a winner fails to pay. Nothing is owed unless they accept it.

New buyers start with $2,500 of open exposure: the maximums on lots you lead plus unpaid invoices, with each bid checked at its full maximum. The team raises the limit as you build a record of paid orders.

Reserves and Buy Now

A reserve is a hidden minimum the seller will accept. Lots with one show "Reserve met" or "Reserve not met"; lots without show "No reserve". When your maximum meets the reserve, the price jumps straight to it. If bidding ends below the reserve the lot does not sell at the close, but the seller can still accept the high bid within 24 hours, and the high bidder is then invoiced like any win. Treat a bid under the reserve as a real offer.

Buy Now is a fixed price some lots carry until the first bid; after that it disappears. Using it is a binding purchase, invoiced like a win, and worth taking when the price is under the maximum you had already worked out.

Bidding tips for liquidation auctions

1. Set your maximum from the numbers, not the countdown: expected resale minus selling costs, pickup, any buyer fee and the profit you need. The pallet profit guide shows the method.
2. Bid early, bid once. Waiting gains nothing under a soft close, and an early maximum shows at once whether someone values the lot more.
3. Skip round numbers. Ties go to the earlier bid, so in the example above $1,015 beats $1,000 and costs at most $15 more.
4. Read the manifest first. Only manifested lots carry the 48-hour claims window; see manifested vs unmanifested lots.
5. Price in pickup. Check the pickup window and line up a vehicle or carrier before you bid; out-of-town buyers should read pickup from out of town.
6. Follow the stagger. With lots 30 seconds apart, set every maximum before the first close, and keep your exposure limit in mind.
7. Know the scam signs. Real auctions have a warehouse, a pickup process and normal payment methods; see the red flags checklist.

Liquidation auction FAQ

Can I cancel a bid?

No. Bids on Two Bro Sales are binding and cannot be retracted, typing errors included. An unpaid win costs the greater of $100 or 10% of the winning bid and a strike.

Is there a buyer's premium on Two Bro Sales?

Only when Two Bro Sales introduced you to the seller: 5% of the winning bid, capped at $500 a lot. Buyers a seller invited pay none on that seller's lots.

Who runs the auctions on Two Bro Sales?

Independent sellers, on their own storefronts; Two Bro Sales runs the marketplace and payments. Browse current auctions to see real lots.

Can individuals bid?

No. Two Bro Sales is for business buyers only, with a resale certificate (Georgia Form ST-5 or your state's equivalent) approved before you can bid.