Why Liquidation? Why Buy Liquidated Goods To Resell?

It’s not surprising that many retailers are now looking to move away from traditional sources of wholesale merchandise. After all, with the ever-increasing costs of wholesale goods added to a wholesaler’s premium, the days when you could still get decently-priced wholesale merchandise from a traditional wholesaler are all but over. If retailers don’t cast their nets wider, there’s a very real chance that they will fall into financial difficulties not of their own making.

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To avoid being holed below the waterline by ever-increasing wholesale prices, many retailers with valid reseller licenses have started to turn to online liquidation sales marketplaces operated by the bigger players in the liquidation sector such as Direct Liquidation. Should your retail business consider doing the same? Let’s take a look why you should.

What Is Liquidation?

‘Liquidation’ is a term a lot of people associate with insolvent companies being wound up by administrators. While this is indeed one of the word’s meanings, when it is applied to the retail and wholesale sector, it means the process through which a retailer disposes of its unwanted stock by using the services provided by a liquidator.

Every year, retailers – in particular large-scale national chains such as Walmart, Amazon and Lowe’s Hardware – end up in possession of huge quantities of surplus stock that they wish to dispose of quickly. There are several categories of stock retailers wish to get rid of, all of which fall under the umbrella term ‘liquidated stock’.

By far the largest amount of stock a retailer looks to dispose of is customer returns. Customers return products to stores for a number of reasons, ranging from the products not working or being superficially or visibly damaged, to the customer suffering so-called ‘buyer’s remorse’ and returning products to stores simply because they have changed their minds.

No longer legally allowed to classify these returns as new, despite the fact many of the products still technically are, the retailers look to offload what are now for all intents and purposes second hand stock as fast as possible, so this type of merchandise does not clog up valuable warehouse space.

As well as customer returns, the other types of liquidated stock are overstock, closeouts and refurbished merchandise. Overstock is merchandise that a retailer has over-ordered. Types of overstock include seasonal merchandise the retailer has failed to sell and now wishes to dispose of to make way for other products. Typically available to buy wholesale after each season comes to a close, seasonal overstock is particularly attractive to resellers with enough storage capacity who can sit on the merchandise until the season the stock pertains to rolls around again.

The term ‘closeouts’ refers to merchandise that comes from a store the retailer has chosen to close. This type of merchandise can include brand new, bang-up-to-date goods that are being sold for a very hefty discount as the retailer does not have the capacity or the inclination to fold the stock back into existing stores and warehouses. The term ‘closeout’ can also refer to certain types of seasonal merchandise, making it an often-interchangeable term with ‘overstock’.

Finally, there’s refurbished merchandise. These are products that are brought back to a retailer because they are faulty. Refurbished goods are extensively tested to locate the fault, repaired and then resold. Refurbished goods such as refurbished laptops are particularly attractive to electronics resellers who can get their hands on the latest tech products at a fraction of the price they would normally pay. Refurbished goods also sometimes come with the original manufacturer’s warranty, making these types of goods especially attractive to customers.

What Liquidators Can Offer Your Business

Top-tier liquidation specialists offer big-name retailers spaces on their online liquidation marketplaces through which they can sell all their unwanted returns, overstock, closeouts and refurbished products direct to resellers at a considerable discount.

In Direct Liquidation’s case, that means you will find products being sold via live liquidation auctions by four of the nation’s largest retailers – Amazon, Walmart, Target and Lowe’s Hardware. This means your business will be able to buy pallets or truckloads containing products manufactured by some of the biggest brands in the world, companies such as Samsung, Apple, LEGO, HP, Microsoft, Fisher-Price, Google and LG.

Sold either via live liquidation auctions or for a fixed or negotiated price, all pallets and truckloads of goods sold on behalf of the national retailers are sold ‘as is’. This means that unscrupulous practices widely seen in traditional wholesaling such as manifest alteration and cherry picking of the best a pallet has to offer before selling on a load of junk are eliminated. What you see when you buy from a top-tier liquidation specialist such as Direct Liquidation is what you get. And what you get is top-quality merchandise coming directly from some of the biggest and most trusted names in US retail.

Why Buy Liquidated Goods To Resell?

The most obvious answer to this question is cost. As we have explained, big-name retailers such as Amazon and Target are prepared to take a considerable cost hit on the goods they sell through liquidation marketplaces simply because they have no desire to clog up their warehouse network with stock they do not wish to sell or cannot sell for a variety of reasons. This means resellers will find pallets of premium-grade merchandise being sold via live liquidation auctions at prices they simply will not find elsewhere.

That means three things. Firstly, the price you pay for the liquidated stock you purchase via an online liquidation marketplace means you can offer your customers low prices. This increases the likelihood that they will not only buy products from your business, but also that they will be more likely to return for more.

Secondly, by buying merchandise wholesale from a liquidator that you can offer at an attractively low price, you’ll keep your competitors at bay because they’ll struggle to match the prices your business can offer its customers.

Finally, the low price you pay for your merchandise not only means you can pass on considerable savings to your customers. It also means you will increase the likelihood of making more money on each pallet or truckload you source this way. It really is a win-win situation.

If you’re on the lookout for a better source of wholesale merchandise, look no further than what an online liquidation marketplace can offer your business. Why liquidation? Why not!

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.