Starting an Online Business: Sourcing and Selling the Easy Way

If you’re considering starting your own business specializing in buying and selling wholesale merchandise, one of the things you must get right is sourcing the stock that will be the lifeblood of your new business. You’re probably thinking that you can get good-quality wholesale merchandise locally. Unfortunately, while this certainly used to be the case, many local, small-scale wholesale suppliers have raised their prices so high that those prices are now almost on a par with retail prices. This means there’s very little profit to be made sourcing this way – a fact that will hole your budding online retail business below the waterline before it’s even got going.

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Thankfully, you can avoid the mistake of sourcing from an overpriced supplier right at the start of your business journey. Instead of sourcing the old-fashioned way, you should look online and see what a top-tier liquidation specialist such as Direct Liquidation can offer your new business.

What Is A Liquidator?

Unlike a traditional wholesale supplier who usually acts as a middleman between the supplier of the wholesale merchandise and the buyer, top-tier liquidators operate their businesses in an entirely different way. Liquidators operate online liquidation auctions and sales sites. It is on these sites that some of the biggest names in US retail sell their unwanted customer returns, overstock and closeouts direct to retail businesses and wholesale suppliers at a considerable discount. Here’s a quick breakdown of what those terms mean:

Customer Returns

By far the largest category of surplus merchandise a liquidator sells on behalf of the big-name retailers, customer returns are products that have been returned to the retailers because they are found to be faulty, they bear superficial or noticeable damage or customers have simply changed their minds about their purchases. Sold in box loads, pallets and truckloads, customer returns come in a variety of conditions ranging from ‘as new’ to ‘tested-not-working’, therefore making them suitable to sell at a variety of price points while the ‘tested-not-working’ products can be used by your online business for spares and repairs.

Overstock

‘Overstock’, as the name suggests, is surplus merchandise retailers have either over-ordered or that is now surplus to requirements. Overstock pallets tend to contain slightly older products such as iPhones from a couple of iterations back, for example. Overstock also refers to seasonal stock that the retailer wishes to dispose of quickly after the season the stock relates to comes to a close.

Closeouts

‘Closeouts’ is the term liquidators use to describe surplus merchandise that comes from a store that is either closing its doors for good or being restructured. Rather than transfer the stock to other stores that usually have all the stock they need and therefore cannot house this surplus, the retailers instead look to sell on their closeouts via online liquidations marketplaces.

Liquidators also sell refurbished products. These are products that have been tested, returned to factory spec and sold with all accessories in either the original packaging or with replacement plain white or brown packaging. Refurbished products also usually come with a 90-day warranty for extra peace of mind.

All of the products a liquidator sells on the big name retailers’ behalf are sold at well below their MSRP value, making an online liquidation marketplace the ideal place for startups to source stock.

Sourcing From An Online Liquidation Marketplace

If you’re considering starting up your own online retail business and you like the sound of sourcing from a liquidator, the process couldn’t be easier. On Direct Liquidation’s online auction and sales platform, you’ll find a huge range of surplus merchandise covering everything from automotive parts and accessories to consumer electronics, from toys and games to fashion and fashion accessories.

You’ll find box loads, pallets and truckloads of returns, overstock, closeouts and refurbished stock from some of the world’s most-trusted manufacturers. If you’re planning to open up your own wholesale electronics retail business, for example, you’ll find products made by such giants as Sony, Microsoft, Apple, Samsung, HP and Google. And, thanks to Direct Liquidation’s partnership with Walmart, Amazon, Lowe’s Hardware and Target, you’ll also find own brand surplus merchandise from Walmart’s popular Blackweb electronics brand.

Getting your hands on the thousands of fantastic products the retailers sell via Direct Liquidation’s website couldn’t be easier. First of all, you’ll need a resellers license to sign up for a free account. A reseller’s license is a certificate that entitles you to buy wholesale products without paying local sales taxes. Instead, your customers pay the taxes when they buy from you and you then forward those taxes on to whatever state you reside in.

Once you’ve signed up for a free account with Direct Liquidation, you’re free to browse the products in the many categories the company has to offer. Direct Liquidation sells products on behalf of its retail partners in box loads, pallets and truckloads. The fact you can buy single boxes of liquidated merchandise is good news for startups on a tight budget with little storage space as it means you won’t have to lay out large sums of money to begin with, and you can get selling to customers without the need to take out expensive loans or renting storage.

After you’ve found a box load or pallet of wholesale merchandise you like the look of, you can bid for it at auction or, in certain cases, buy it for a fixed or even a negotiated price. Usually, customers choose the auction route. If this is for you, you can set up an email alert on the liquidated stock you’re interested in buying which will alert you when that stock is about to go under the hammer. Then it’s just a simple matter of entering bids up to a predetermined maximum bid and seeing if you’re the successful bidder. If you are, all you then have to do is pay for your winning lot and arrange shipping.

On the subject of shipping, many startups don’t wish to go to the expense of paying for expensive third-party shipping, instead preferring to pick up their purchases themselves. Liquidators – Direct Liquidation included – are usually happy to let this happen, which means your startup will save on shipping costs. Of course, if that’s not an option, you should check out what the liquidator charges for shipping. It’s often cheaper to let the liquidator handle the shipping as opposed to a third-party courier, so be sure to check what the liquidator charges first.

Making A Success Of Your Online Business

Once you have a box load or pallet of surplus merchandise, it’s time to get selling and making money online. Many startups think Amazon and eBay are the best place to start selling their wares, but this isn’t necessarily the case. Both platforms are crowded marketplaces with thousands of retailers vying for that coveted Top Seller status that pushes their goods to the front of the queue. You’ll have a long way to go before you’re in that position, so it’s best to start small. As well as online, advertising in local classifieds can bring in a fair few customers, as will listing your products on sites like Craigslist.

Also, don’t ignore the power of social media. A targeted ad on Facebook is relatively inexpensive, for example, and can reach customers interested in buying exactly what you’re selling. Instagram can be a great platform for showing off what you have to offer, and Twitter is the place to shout about all the fantastic products you have for sale. In this day and age, ignoring the potential of social media is a big no-no.

If you do want to open up an online store, then there are smaller, less-crowded hosting sites than the big guns of Amazon and eBay. Sites like Wix, SquareSpace and Shopify usually offer free trials, usually for fourteen days or so, where you can give them a go without laying out any further money. For a startup on a tight budget, this might be a better idea than paying the upfront and back end fees of Amazon and eBay respectively.

However you choose to sell your freshly-acquired liquidated stock, you’ll have an immediate advantage over your competitors because you will have bought top-quality merchandise coming from some of the country’s most trusted retailers at prices low enough to ensure you can offer new customers amazing prices while at the same time making a healthy profit. This will allow you to restock and expand your business as time goes by.

Starting an online selling business can be a daunting prospect. Luckily, by sourcing stock from a liquidator, your brand-new business will have excellent-quality stock that can be sold for a great price. With that boost, you’ll soon find your business is selling more and more products to an ever-growing customer base while making a profit that will help your business grow and grow. Looking to start up a new online retail business? Look no further than an online liquidation sales marketplace for all your sourcing needs.

Direct Liquidation is a goTRG company.

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Henley Johnson

Henley currently works as a sales representative for Direct Liquidation, assisting businesses with product sourcing of liquidated merchandise from the largest retailers in the world. Whether you are looking for a pallet or a truckload Henley is here to help you grow your business.

View Henley’s Bio on YouTube.