Fire sale (finance)

A fire sale in finance is a sale of assets at unusually cheap prices.

Originally the term meant a sale at very low prices of damaged goods when a store had a fire; the business would have a sign saying "Fire Sale: everything must go!"

There is no legal requirement that an actual fire (or any type of disaster) have taken place to use the term; it is commonly used in advertising when a business is either ceasing operations, has excess inventory to clear, or in some cases has purchased a large amount of goods and wants to sell them cheap (believing that customers will come in and then spend on higher-priced goods, netting a profit for the owner).

Other terms include "hail sale" (common in the auto industry, where cars with minor hail damage are sold at a discount, the dealer already having collected proceeds from the insurance company) and "liquidation sale" (which may or may not involve the business actually closing, but instead may have bought stock from an actual closed business or overstock).