OSAWATOMIE — The Osawatomie City Council has directed City Manager Don Cawby to negotiate an agreement with a late addition to the list of firms seeking to sell city-owned grocery equipment.
Council members decided Vision Equipment & Auction Co., Covington, Ga., would be its first choice to help liquidate the equipment.
Cawby told council members at their meeting Wednesday, June 26, that a representative of Vision Equipment flew in from Atlanta that morning and looked at the equipment.
Vision is well connected to the grocery industry, Cawby said. Vision’s customer list includes Kroger, Winn Dixie, Whole Foods, Publix and many other chains, according to the company’s website.
Since 2004, Vision Equipment and Auction Company has been the industry leader in commercial foodservice equipment auctions and liquidations, according to its website, which on Monday, July 1, featured auctions for a Kroger store in Durham, N.C., and a Fresh Farm store in Norfolk, Va.
But liquidating the city’s grocery equipment might not come to an auction. The Vision representative said the company might be able to find a single buyer for all the equipment, rather than having to sell it piece by piece at an auction, Cawby said.
Vision’s commission would be 10 percent, with a flat $9,000 fee for items such as marketing, removal, dumpster, scrap rights, sales taxes and other expenses. Vision’s commission rate was the lowest among the companies seeking to auction the equipment. The $9,000 would be deducted from the sale proceeds.
Council members directed Cawby to negotiate and sign an agreement with Vision. If an agreement cannot be reached, the council selected Grafe Auction Co. as its second choice. The Spring Valley, Minn., company also has a national reach and specializes in liquidating commercial assets.
The community has been without a grocery store since Ron’s Country Market closed its doors in 2017. Much of the equipment, valued at $400,000, was almost brand new, and the city purchased the equipment through a lease-purchase agreement with First Option Bank for a reduced cost of $150,000 in the hopes of bringing another grocery store to town.
A 60-day clock started ticking Monday, June 24, on the city’s need to liquidate the equipment or move it to a new location. Equip-Bid.com, an online auction company, purchased the former grocery building, and the closing date was June 24.
The city also received a proposal to store the equipment, Cawby said.
“David Spears, who has been advocating to keep the equipment, gave us a bid of $12,800 to dismantle and remove all the equipment. He also located a storage site in La Cygne for $850 per month,” Cawby wrote in his report. “I think this bid is in the ballpark of what it would cost, with the possible exception of dismantling the compressors. We would look for other storage options in Osawatomie or closer to the City, if available.”
Cawby said while Spears’ proposal would give the city more time, it would create some duplicate costs, such as the ongoing monthly storage cost, while the value of the assets would continue to depreciate it.
After a lengthy discussion and weighing pros and cons, council members decided to pursue selling the equipment.