
You see them all the time on the stores on Wisconsin between Dumbarton and P: “Going Out of Business” signs. And yet the businesses that hang them don’t actually go out of business. It’s a tawdry tactic primarily intended to fool tourists into thinking that if they come in to the store they’ll get a great deal. But what people might not realize is that these signs are illegal.
Title 47, chapter 21 of the DC Code is abundantly clear on when and how “going out of business” sales can be run.
First it defines what it calls a “closing-out sale”:
“Closing-out sale” means and includes any sale in connection with which there is any representation by the person conducting such sale that the sale is being conducted, or is required or compelled to be conducted, for reasons of economic or business distress, inability to continue business at the same location, or the age or health of the owner or owners of the business, and the term “closing-out sale” shall include but not be limited to, all sales advertised, represented, or held forth under the designation of “going out of business,” “discontinuance of business,” “selling out,” “liquidation,” “lost our lease,” “must vacate,” “forced out,” “removal,” or any other designation of like meaning.
Then it lays down rules meant to guarantee that when you say you’re going out of business, you’re really going out of business. For one, you can’t stock up the store in anticipation of a closing sale:
No person in contemplation of a closing-out sale shall order any goods, wares, or merchandise for the purpose of selling and disposing of the same at such sale, and any unusual purchase and additions to the stock of such goods, wares, or merchandise within 60 days prior to the filing of application for a license to conduct such sale shall be presumptive evidence that such purchases and additions to stock were made in contemplation of such sale.
And once you’ve started a closing sale, you can’t stock any more goods: Continue reading →
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