Amazon Return Pallets: How and Where to Buy Them

Last Updated: April 14, 2025.
Added: Step-by-step guide to purchasing Amazon return pallets.

Amazon is the world’s largest online retailer, processing over 66,000 orders every hour. Not every product stays with the customer, though—some are returned for various reasons. These returned, overstocked, or liquidated items are bundled into Amazon Return Pallets and sold to third-party wholesalers at a discount.

Purchasing these pallets can be a profitable venture, but it can also be tricky without the right knowledge. This guide breaks down everything you need to know about buying Amazon return pallets, from the benefits and challenges to where to find them and tips for success. Whether you’re an experienced reseller or just starting, this guide will help you make smarter, more informed decisions.

Shopping online has become the new norm, with sellers competing to increase their markets. Popular platforms like Amazon, eBay, and Walmart are among the best places to shop, and more retailers are using these sites—along with their websites—to reach a larger, global audience.

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Amazon by the Numbers:

• More than 9.7 million sellers worldwide are using the Amazon Marketplace as of January 2025.
• More than 600 million products globally are available on Amazon as of 2024.
• Amazon.com received 6 billion direct visits via desktop over six months in 2024.
• With $438B in net sales, the United States remains Amazon’s biggest market in 2024.
• Top Amazon Product Categories in 2024:
  • Home & Kitchen 35%
  • Beauty & Personal Care 26%
  • Clothing, Shoes & Jewelry 20%
  • Toys & games 18%
  • Health, Household & Baby Care 17%
  • Baby 16%
  • Electronics 16%
  • Sports & outdoors 16%
  • Pet Supplies 13%
  • Office Supplies 13%
  • Home & Kitchen 35%

With a global reach comes global challenges. While shopping online is quick, easy, and convenient, there’s another side to the story: customer returns.  There are many reasons why people return products, and in fact, 16.5 percent of all online purchases end up being returned, compared to approximately 10% of in-store purchases. Today, around 76% of retailers in the United States now offer free returns shipping and customers have made it clear—they expect this service.

As a result, the number of retail returns has skyrocketed.  84% of customers say they’re more likely to shop with a retailer that offers free returns. While this is great for shoppers, it also means that more products are being returned—and those returns need to be handled.

Amazon return pallets are a fascinating way to acquire bulk merchandise at discounted prices. These pallets often consist of returned items that are either unopened or lightly used, and they are sold to liquidation companies or directly to buyers. You can find these pallets sorted by category or as mixed lots, offering opportunities for reselling or personal use.

If you’re interested in exploring this, Direct Liquidation is a popular option for purchasing Amazon return pallets. We provide a variety of items, from electronics to home goods, often at a fraction of their original cost.

Would you like to learn tips and discover how to buy or resell these pallets?  Keep reading and learn for yourself.

What Does Amazon Do With Returns?

Amazon has been criticized for destroying millions of items, and now has the stated intention to work “toward a goal of zero product disposal.” There are now programs in place to allow sellers to resell customer returned items, or to allow them to be sent to the liquidation market.

Amazon third-party sellers told CNBC they end up throwing away about a third of their returned items. Amazon now gives sellers four options (subject to a fee) for dealing with items that they can’t sell as new: Return to Seller, Disposal, Liquidation, and Fulfillment by Amazon Grade and Resell (at the moment by invitation only).

There is also liquidation, which Amazon now offers sellers as an option instead of disposal. Amazon partners with liquidation marketplaces, which auction off unwanted inventory to resellers by pallet or even truckload. Sellers can recover around 5 to 20% of the sale price if the product is liquidated.

With the ‘Return to Seller’ option, returned items leave the Amazon warehouse and are sent back to the seller for processing. For non-electronic items that are unopened, many are simply relisted for resale. However, if the item has been opened, what happens next depends on the seller—whether it’s Amazon itself or a third-party seller—and the value of the item. If the resale value is worth the cost of repairs, cleaning, testing, and repackaging, many sellers will choose to fix and resell the product, if it makes sense financially

Electronics are treated a bit differently when returned to Amazon. Many returned electronics go through a thorough inspection and are repaired if needed. After that, they’re listed on Amazon Renewed, where customers can buy refurbished items that work like new but at a much lower price than buying a brand-new product.

However, getting items onto Amazon Renewed isn’t easy. There are strict rules set by Amazon, making it harder for third-party sellers to list refurbished products. Sellers must follow these stringent rules to qualify.

So, what happens to returned items that don’t get resold on Amazon? Some of these items are packaged into pallets and sold in bulk as liquidation merchandise.

For sellers using Fulfilled By Amazon (FBA), Amazon handles the categorization of returns. The returned items are labeled as either sellable, damaged, customer-damaged, defective, carrier-damaged, or expired. If the damage is caused by Amazon or the courier, the item becomes Amazon’s property, and the seller is compensated. In such cases, Amazon sells these returned products by the truckload.

Why Buy Amazon Return Pallets?

Discounted Prices

Return pallets are often sold at a fraction of the retail price, giving buyers the chance to purchase items at a steep discount. This can be especially profitable if the pallet contains high-demand or valuable products.

If you’re looking to save money on inventory costs and are willing to take on the risk of potentially receiving items in less-than-perfect condition, buying Amazon return pallets can be a smart business decision.

Buying Amazon return pallets means you can source more merchandise for less, compared to buying all new items wholesale. As with any business, there are risks but your money can go further if you are willing to improve the salability of the merchandise once you receive your inventory.

Variety of Products

Buying Amazon return pallets comes with the benefit of having a wide variety of products available. These pallets typically contain a mix of different products from electronics and household appliances to clothing and accessories. This variety allows buyers to select the pallets that best suit their needs. In addition, the variety of products available in Amazon return pallets can also be an advantage for businesses that are looking to diversify their product offerings, since Amazon offers products in more than 25,000 sub-categories.

Sustainability

Buying Amazon return pallets is also a sustainable option. Rather than these items being thrown away, they are being given a second chance at finding a new home. This makes buying Amazon return pallets more environmentally sustainable.

Where to Find Amazon Return Pallets?

The best place to buy Amazon return pallets is through liquidation companies. When searching for a reliable source, it’s important to choose a reputable seller. A good way to gauge a company’s trustworthiness is by checking out customer reviews. These reviews give you a clear idea of the company’s service and product quality, which reflects its reputation.

Direct Liquidation is a highly reputable company that has built a strong reputation by keeping customers happy and forming partnerships with major retailers. Through their platform, you can buy Amazon return pallets, as well as merchandise from other retail giants like Walmart, the largest retailer in the U.S. This gives you access to a variety of products at discounted prices.

Step-by-Step Guide to Buying Amazon Return Pallets

Step 1: Conduct Market Research

• Understand the Market: Research the typical product types available in Amazon return pallets. Focus on products in demand and familiarize yourself with market trends for your chosen product type.
• Identify Reputable Liquidation Companies: Look for well-known liquidation companies (Direct Liquidation) that specialize in selling Amazon return pallets. Check reviews and ratings to gauge reliability. Many liquidation companies get bad reviews from new buyers who are struggling. When reading reviews, make sure to think carefully and judge them wisely to get a better idea of the company.

Step 2: Register with a Liquidation Company

• Create an Account: Visit the liquidation company’s website and sign up for an account. This usually involves providing basic business information and agreeing to terms and conditions. Most liquidation websites will allow you to create an account for free. Make sure to register your business with your local government and acquire a resale certificate. This will allow you to avoid paying sales tax when you purchase resell inventory.
• Understand the Auction Process: Most liquidation companies sell pallets through auctions. Familiarize yourself with the bidding process, payment methods, and terms of sale.

Step 3: Analyze Available Pallets

• Inspect Pallet Listings: Carefully review the descriptions and photos of pallets. Look for details about the items’ condition (new, refurbished, used), product categories, and estimated retail value. This information is typically contained in a downloadable manifest.
• Evaluate Costs: Consider the total cost, including the bid price, shipping fees, and any additional handling charges or marketplace fees.

Step 4: Place Your Bids

• Set a Budget: Determine your budget based on potential resale value and expenses. Stick to your budget to avoid overspending. A good rule of thumb is to take 40% of the retail price quoted and then 40% of that number as your max bid price. This is a good general rule of thumb to keep from overpaying for a pallet.
• Bid Strategically: Place bids on pallets that align with your business model and have high-profit potential. Avoid getting caught in bidding wars. That’s easier said than done, as more popular auctions are also an indicator of the inventory’s desirability.

Step 5: Arrange Shipping

• Shipping Arrangements: Once you win a pallet, coordinate with the liquidation company for freight shipping. Some companies offer shipping services, while others require you to handle it. If you are shipping to a residential address you will have to ensure the goods carrier ships using a truck with a liftgate to facilitate unloading. The liftgate is an additional cost.
• Plan for Storage: Ensure you have adequate space to store and sort the items once they arrive. This could be in your garage, or you can consider renting a small storage locker.

Step 6: Sort and Process Items

• Inspect and Sort: Upon arrival, inspect each item. Sort them based on condition and category.
• Repair and Refurbish: If capable, repair or refurbish items to increase their value. This is particularly important for electronics and appliances.

Step 7: Resell the Products

• Choose Sales Channels: Decide where to sell the items – online platforms like eBay or Amazon, local marketplaces, or physical retail locations. Be aware that condition matters. Some places will not allow you to sell raw customer returns. eBay, Facebook Marketplace, Offer Up, and Craigslist are your best starting points.
• Price Items Competitively: Set prices based on item condition, market demand, and competition. Remember to account for your costs and desired profit margin. You need to make money or it’s not a business. Don’t get caught in the weeds. Treat this as a business every step of the way.

Step 8: Manage Inventory and Finances

• Track Inventory: Keep a detailed record of your inventory, including purchase costs and sales. You can start with a spreadsheet, but you should quickly consider inventory management software and tools to scale.
• Monitor Finances: Regularly review your financials to understand your profit margins and adjust your strategy as needed.

Step 9: Scale and Diversify

• Expand Product Range: As you grow more comfortable with the process, consider diversifying the types of pallets you purchase.
• Scale Your Business: Reinvest profits to buy more pallets and expand your business operations.

Step 10: Stay Informed and Adapt

• Keep Learning: Stay updated with market trends and changes in the liquidation industry.
• Adapt Your Strategy: Be prepared to adapt your buying and selling strategies based on market changes and your business performance.

Looking to Scale? What Can You Expect Buying Amazon Truckloads

There are four main types of Amazon returns truckloads:

Large products, or ‘Bigs’

These truckloads contain 26 tall pallets, mostly consisting of large items, such as televisions, large appliances, display cases, furniture, and similar merchandise. These lots are ideal for larger retail stores with space to accommodate these items for sale locally.

Small products, or ‘Smalls’

“Smalls” truckloads contain small merchandise items. As you can fit many smaller items into the Gaylord pallets, the average piece count is very high. Some of this smaller merchandise can be very valuable and may contain designer sunglasses or watches, electronics, and branded accessories. This type of merchandise is perfect for bin stores and online sales. Due to the huge piece count of potentially high-value items, these truckloads often contain the most profit potential on resale. The high number of product variations you will receive in these lots may be time-consuming to process, especially for listing online but should give you the best return on resale on your initial investment.

High Retail

These truckloads contain the most popular items for resale but in lower quantities. They contain 26 pallets with lower item counts than the small truckloads but are more likely to contain the strongest retail items, that are particularly sought after by online sellers. These lots will contain some of the best-selling stock available from Amazon, meaning your turnover will be quicker, but with less profit potential overall.

Clothing

Clothing is a huge sector for Amazon, and the high rates of clothing returns mean there is no clothing shortage in very good condition, most of it is poly-bagged and ready for resale. Many clothing buyers will obtain the product to resell overseas, where demand for American clothing is popular. Each of the 26 pallets in these lots can contain up to 1200 clothing items or more. Lucky buyers will also find designer clothing, and accessories such as handbags, scarves, belts, and more. Clothing lots are generally mixed clothing for men, women, and children, though some lots will also contain baby items.

Tips On Upscaling Amazon Return Pallets

Once you’ve purchased and received an Amazon returns pallet, you’ll want to maximize your potential profits by upscaling as much of the pallet’s contents as possible. As discussed, Amazon returns pallets are typically untested, meaning that each pallet’s merchandise will be in a variety of conditions. Some of the merchandise will be retail-ready, while some of it may need some repairs.

To increase your chances of squeezing as much profit from each Amazon return pallet purchase, there are several things you can do:

Sort and Bundl

Start by sorting through your pallet to see what you have. Separate items that can be sold right out of the box from those that need some attention. Some products may be more appealing to customers when sold together as a bundle, so consider grouping related items that make sense as a set.

Repair and Refurbish

Many items are returned due to faults, especially electronics. If you can, repair or refurbish these items yourself or hire a third party to do so. Often, the issues are minor and can be fixed easily, making the products as good as new and adding value. For pallets with multiple faulty items of the same model, you can swap parts between them to restore a working version. Don’t throw away products that can’t be repaired—broken items can often be used for spare parts.

Re-Accessorize

Sometimes returns are missing accessories like chargers or headphones. These are usually inexpensive to replace, and having the full set of accessories can increase the value of the product. Make sure to source any missing items and include them when selling.

Repackage

If the original packaging is damaged, try to find replacement packaging or repackage the product yourself. Believe it or not, the packaging plays a big role in the product’s value, so ensure that your items are either in their original packaging or packaged neatly in high-quality, plain packaging.

Inspecting and Grading

Make sure to inspect all your products thoroughly. When reselling, ensure that you advertise them at the correct grade. Most of the items you sell will fall into the following categories:

• New Factory-Sealed: These items are brand new, still in their original boxes, and sealed in their factory plastic wrapping. The merchandise has never been opened and is in pristine condition.
• New Open-Box: This merchandise is new and in perfect condition, but the packaging has been opened.
• Refurbished: Refurbished items have been inspected, repaired if necessary, and accessorized and repackaged.
• Used: These items are functional but show visible signs of wear and tear, including scratches and/or dents.

Pros and Cons of Buying Amazon Return Pallets

Here is a list of the pros and cons of buying Amazon Returns Pallets:

Pros:

• Low purchase cost compared to the original retail prices of the items.
• Wide variety of products available.
• Inventory comes from a trusted retailer, meaning you can expect goods from reputable brands

Cons:

• Shipping costs can be expensive, especially if you’re not located near the warehouse they are being shipped from.
• Return pallets often contain some damaged or non-functional items, and you won’t know the percentage of damaged goods when you make the purchase.

Buying Amazon Return Pallets from Direct Liquidation

Research is crucial if you want to be successful in this business. Reputable liquidation companies offer certain benefits to their buyers. The misconception that only scrap is sold through liquidation companies often comes from customers who rushed to buy cheap merchandise without doing any research on the seller, the merchandise, or anything else beforehand. This is a major mistake in the liquidation business and should be avoided at all costs. Always do your research.

Choosing to buy Amazon return pallets from a reputable seller like Direct Liquidation means that much of the groundwork has already been done for you. However, you should always ask for the manifest of the lot you are interested in. For most lots, Direct Liquidation provides manifests—lists that contain all the relevant details about the merchandise in a pallet, including its condition.

Direct Liquidation uses proprietary software to generate these manifests, ensuring that each one accurately reflects the contents of the pallet.

Where available, the manifests Direct Liquidation provides to its business customers contain valuable information that will help you choose the merchandise you need as well as plan how to sell it. Depending on your target market and your customer base, you will be able to determine what products you are getting, even in a pallet of returned merchandise. Whether you decide to buy unsorted customer returns, that are at the lowest price point, or closeouts and overstock merchandise that have the highest resale value, but also cost a bit more, depends only on your personal preference and business needs.

Buying Amazon return pallets from Direct Liquidation is a great way to purchase merchandise at prices well below typical retail values, setting yourself up for a chance to profit when you sell. Just make sure you do your research, find the right market and the right products to resell, and don’t get into bidding wars and you’ll make out fine.

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