Going out of business!

Everything must go!

All sales are final!

…but some of those going-out-of-business sales seem to go on forever. So what exactly are the laws regulating retailers who are closing up shop?

We asked the New York State Division on Consumer Protection to break it down.

How long are ‘going out of business’ sales allowed to go on?

60 days, tops. Businesses actually have to apply for a license through their local municipality. The initial license expires after 30 days. The business can apply for an extension of another 30 days. They cannot hold consecutive “going out of business” sales.

All sales are final…or are they?

Just like with any retailer, return and refund policies must be clearly posted. If one is not posted, the store must provide a cash or credit refund within 30 days from the date of purchase. So, “all sales are final” is allowed, provided that policy is made clear upfront.

Technicalities

If a business has more than one location, each store needs its own license. Businesses must provide the state a list of items that will be sold. They are not allowed to add or substitute inventory, nor can they bring in goods from another branch.

State law also prohibits them from opening a similar business within a year after the sale ends.

These requirements apply to businesses that sell to the public. Laws do not apply to the sale of goods to a licensed auctioneer, a public officer, an insurance corporation or anyone acting in accordance with a court order.

If you see something, say something

If you are concerned about a potential fraudulent going out of business sale, you should report it to the local government in which the store is located.

For other consumer issues, you can reach out to the New York State Division of Consumer Protection at 1-800-697-1220 or by filing a complaint.