Can You Buy New Stock Cheaply From Liquidators Online?

So far in your online resale career, you have been buying pallets of merchandise usually through a network of reliable and reputable wholesalers. While this tactic has worked for years, recently your profit margin has been decreasing as prices of single items on platforms like Amazon are getting closer to wholesale, leaving you less and less room to work with. This has you wondering: what does the competition have that you don’t, or more exactly, how does your competition procure merchandise so cheaply without compromising quality and still keeping their profit healthy?

The answer is not a complicated one: they are buying stock cheaply from closeout liquidation companies, closeout suppliers and they usually purchase closeouts online. While the answer is short and looks simple, there is a lot of ground to cover. Understanding what closeout and overstock merchandise is, and how buying closeout merchandise can help you grow your business and elevate it to another level.

This also answers the title question affirmatively, as it is possible to buy cheap stock from liquidators online. But let’s look into this a bit closer.

What is Closeout and Overstock Merchandise?

There are a number of reasons for merchandise to be categorized as closeout or overstock merchandise, and there is a slight difference between the two categories.

Closeout merchandise is the type of merchandise that the retailers have in stock but, for one reason or another, can’t find a buyer for. The merchandise has not sold as expected and as new collections and new products are emerging, the unsold products will end up being packed up into pallets for a closeout clearance, as they want to free up space for new merchandise and wouldn’t like the stock to stay around for long. This is especially the case when it comes to seasonal merchandise, like clothing.

At the turn of the season, the retailer would rather sell the merchandise at reduced prices than store it in their warehouse. This means that the summer clothing is being packed up for liquidation and new fall and winter collections are being brought in for display. The same can be said about electronic devices that are developing faster than ever. With every new model unveiled, the old ones end up being liquidated directly or through closeout suppliers.

Overstock merchandise is different in that the retailer initially ordered larger amounts of merchandise than actually needed. This could be the result of an error or bad decision when it comes reading the market trends, or evaluating the actual demand. As these products don’t even make it to the shelves, they are simply regarded as overstock and retailers end up liquidating merchandise.

The thing that these two types of merchandise have in common is the fact that they are new, usually unopened, maybe tried on at the store, but have never been sold before and remain in brand new condition. It is not unusual to find such products packed with price tags from the store still attached to them.

How Does Merchandise End Up on Closeout Sites?

While manufacturers and retailers can offer clearance closeouts through their websites or from their physical location, it requires work and dedicated staff that might not be available to every business. This is why both manufacturers and retailers turn to closeout liquidation companies that will market closeouts online through their websites and actually do the majority of the work.

While your practice was to buy wholesale products to sell online you were at a disadvantage compared to closeout buyers who would jump onto closeout sites and look for closeout pallets of merchandise being liquidated. This is where we have to explain the difference between buying pallets of wholesale merchandise and buying closeout lots of merchandise through liquidators, which will also answer the question regarding how closeouts end up being sold by liquidators enabling you to purchase new stock cheaply from liquidators online.

Wholesalers are actually closeout buyers like you, but with a larger budget. They usually buy closeout merchandise by truckloads in order to break it up into smaller loads and resell it for a profit. Liquidators, on the other hand, don’t own the merchandise that is being liquidated on their websites. They simply serve as a platform for retailers and manufacturers to reach more end consumers faster. It is not unusual for top-tier liquidators to sign exclusive contracts with manufacturers and retailers covering a number of aspects. Some of these are the minimum quality of merchandise required for the products to be listed online, and these also keep the prices down.

This is why it is essential to look for reputable liquidators to work with. Reputable liquidators guarantee branded merchandise of high quality and both manufacturers and retailers work with them as retailers take off a significant burden off their back.

One of these closeout liquidation companies is Direct Liquidation, a goTRG company, which offers truckloads, pallets and smaller lots of closeout and overstock merchandise, all delivered from their Kentucky warehouse.

The purchase process is simple. You will see closeout lots or closeout pallets being listed for sale on the liquidator’s website. All you have to do is order and follow the purchase process.

The Benefits of Closeout and Overstock Merchandise

The first benefit has already been mentioned: the price. Closeout and overstock merchandise is being liquidated at prices 25 to 50 percent below wholesale merchandise. This means that the profit margin you were eating into by sourcing your merchandise through wholesale product suppliers will remain healthy and offer you good money for your effort. It will also enable you to remain competitive in the market and even push the prices lower, attracting more customers and putting pressure on your competition.  

The other significant benefit is the quality of the merchandise. As noted above, all these products are sold in brand new condition. This means you will not have to fear for the quality of products.

To these benefits, we have to add that purchasing through top-tier closeout liquidation companies has its own advantages. When looking at closeouts online, you will find that top liquidators provide you with manifests for the closeout pallets or closeout lots on offer. The manifests are lists showing exactly what type of merchandise is on the pallet, the count and the quality of merchandise. This enables you to buy only the merchandise you see demand for and decreases the risk of buying closeout pallets blind hoping you will receive the merchandise your customers are after.

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.