B.N. Genius Bids Adieu -- Auction Is Store's Final Chapter

B.N. GENIUS AUCTION

The B.N. Genius liquidation auction of all its high-tech gadgets and electronics, as well as its office and warehouse equipment, continues today through Friday, 10 a.m. to 4 p.m., at 22121 Crystal Creek Blvd. S.E. in Bothell.

-------------------------------------------

For sale at pennies on the dollar: Portable videocassette recorders and TVs, stereos, electronic bathroom scales, electronic memo pads, telephones in the shape of duck decoys and phones built into shoes.

B.N. Genius, which marketed high-tech goods to well-heeled customers, has begun to succumb to an old-fashioned fate. The Bothell-based retailer of expensive high-tech gadgets and electronics - dubbed by some as ``B.N. Broke'' after its parent company filed for Chapter 7 bankruptcy last month - began a court-ordered weeklong liquidation sale yesterday.

Within an hour of its 10 a.m. start, more than 1,000 eager buyers began the bidding for B.N. Genius's remaining inventory, plus all its office and warehouse equipment - a total of 20,000 items with a retail value of at least $4 million.

But retail isn't the pricing mechanism at work at B.N. Genius' cavernous Bothell warehouse. The crowd, which included retirees, housewives, small retailers and smattering of professional auction scavengers talking in hushed tones into cellular telephones, had deep-discount bankruptcy bargains in mind.

``We're waiting to get the good deals,'' said Linda Gregson of Bothell, as she and her husband, Hugh, thumbed through a 123-page catalog that listed some 6,000 items on sale. ``We're interested in anything we can get for as little as possible. I'm doing some Christmas shopping.''

Everything from the retailer's three Washington stores, three California outlets and central mail-order operation went on the block.

The bidding was spirited, and bargains were evident everywhere. Combination videocassette recorder/TVs, originally priced at $1,300, each went for $250 to $475. Video viewers that two months ago sold for $1,400 in the company's stores fetched $475.

``I feel sorry for people who just bought a month or two ago at full price,'' said Cliff Carlson, a Ballard resident.

For Jim Rulfs of Bellevue, the auction presented a new business opportunity. ``There's an opportunity to acquire an inventory here without a line of credit,'' noted Rulfs, who recently was laid off from an Eastside software company. ``It's a little free-enterprise scouting on my part. I'm looking for anything that can be turned around and resold in large lots at close to retail.''

Rulfs said he was eyeing a pile of beach thongs that will be auctioned off later this week. ``There's probably a store's worth of inventory for sale. Under the right circumstances, it would make sense to box them up and spend a long weekend in Hawaii selling them.''

Based on the number of items for sale, this is the largest liquidation that Seattle auctioner James G. Murphy Co. has handled.

The sale is the only way that B.N. Genius's sole secured creditor, U.S. Bancorp, will be able to recoup some of the $3 million that the retailer owes. Although the merchandise is valued at $4 million if sold from a store, there is no way to tell how much money the auction will bring in. But it likely won't raise a dime for the company's 3,000 unsecured creditors, whose claims can only be satisfied after secured debts are paid in full.

The chain's parent company, Sporting Edge Companies Inc., closed B.N. Genius outlets in Westlake Mall, Bellevue Square, Aurora Village and in California in early October, less than a week after investors backed out of a deal that would have kept the distressed retailer open. The closure, which also shut down mail-order operations, threw 125 people out of work.

A buyer's group headed by a former executive at Early Winters Ltd., another defunct Seattle retailer and mail-order house, had agreed to take over B.N. Genius and an undisclosed amount of its financial obligations for $1.3 million. But the deal fell through after one member of the investor group backed out, fearing the last-ditch nature of the sale would make it difficult to obtain merchandise for the holiday season or to prepare its holiday catalog, said Sporting Edge President Alan Hecht.

The closure came after months of maneuvering by B.N. Genius to stave off creditors. The company underwent several ownership and management changes since the early 1980s, but was unable to sustain profits in the competitive mail-order business.

In 1989, despite launching two new catalogs, it lost money on sales of $25 million. Last April, it filed for Chapter 11 bankruptcy protection, listing assets of $7.9 million and unsecured liabilities of about $13.5 million.