When it comes to the Gottschalks liquidation sale, experts say it's best to brush up on a little Latin — namely, caveat emptor.
Let the buyer beware.
"Liquidators have magic going for them, and that magic is the words: 'Going out of business sales.' Those magic words draw consumers, it never fails," said Howard Davidowitz, chairman of Davidowitz & Associates Inc., a national retail consulting and investment banking firm based in New York.
"Those words tend to drive expectations that there are tremendous deals all over the place, while normally there are only some tremendous deals. There is more sizzle than steak."
The April 1 U.S. Bankruptcy Court ruling that approved the liquidation of the 105-year-old Fresno-based retailer means the big yellow "going out of business" signs are up across the chain's 58 department stores, including those in the Northern San Joaquin Valley and foothills.
But, as many shoppers are finding out, all sales are not created equal.
Modesto resident Dyan Hayes left the Gottschalks at Century Center with a bag of children's clothes and toys for her grandchildren. But, she said, she came for the nostalgia, not the deals.
"I only live a few blocks away and I've been shopping here since it opened (in 1984). I don't go to the mall, so I'm very sad," Hayes said. "But, really, it would have been better if I had shopped here three weeks ago. The sale prices were lower."
At the Gottschalks in Vintage Faire Mall, Mary and Allan Tollefson, of Dorrington in Calaveras County, stopped at the store after an eye appointment but said they didn't see many bargains.
"There were better sales at Christmas," Mary Tollefson said. "It's OK, but they've advertised better regular sales before."
In both Modesto stores, signs outside screamed "60 percent off," while inside shoppers were more likely to find 10 percent and 20 percent discounts.
Davidowitz said that to understand the pricing, buyers must understand the liquidation process. In a bankruptcy, liquidators bid on the company's assets. Then based on their winning bid, normally a fraction of what the retailer paid for the merchandise, the liquidator sets prices to increase profits.
"(The liquidator) is trying to maximize their return," Davidowitz said. "That is their goal. Their goal is not to give the consumer a great deal."
The winning Gottschalks bid was the consortium of liquidators SB Capital Group of New York, Tiger Capital Group of Boston, Great American Group of Los Angeles and Hudson Capital Partners of Newton, Mass. The consortium did not return phone calls, and local Gottschalks management declined to comment.
The liquidation sale is expected to last about 10 weeks.
After the initial discount prices are set, they will begin dropping based on sales volume. The liquidator normally has a figure in mind for each week, and if volume slips below that, markdowns will be made more quickly.
The trick for shoppers is how to find the sweet spot of cheap prices and good selection. Shop too early, risk paying more. Shop too late, risk not finding anything you want.
Many Gottschalks customers already are thinking about how to time their purchases. Sacramento resident Jeff Neller, who was visiting family in Modesto, checked out prices on ties at the Century Center Gott- schalks this week.
"I'm getting a few little things and doing more browsing," he said. "Then I'll come back when prices are lower — maybe in three or four weeks."
Timing isn't the only thing shoppers should consider when getting ready to buy at liquidation sales.
"There is an element of risk to the consumer," said Frank Whitney, president and chief executive officer of the MidCal Better Business Bureau in Stockton.
"One of the problems with liquidation sales is that there is no chance to return an item once you buy it. Sales are final. It's no different than going to a garage sale."
Signs are prominently posted throughout the stores telling consumers as much. The notices alert shoppers that all sales are final, checks are not accepted and store warranties no longer will be honored.
Still, smart consumers can leave the store happy if they don't get carried away and buy only what they really like or need.
"Don't think you have to do anything; don't think you're missing anything. You really aren't," Davidowitz said.
"I think the key thing is be analytical and be careful. The best thing is to buy something simple, like a sweater. And if you buy something you really like, you can't make a mistake."
Bee staff writer Marijke Rowland can be reached at email@example.com or 578-2284.