If you haven’t considered liquidation as a product source for your E-Biz, you might want to think again – it can be a very profitable prospect for any online seller. When large retailers, wholesalers, and manufacturers need to convert their excess inventory into cash, they often offer it at well-below wholesale costs in an effort to recoup some of their monies. The types of products you can source in the secondary market are as varied as the suppliers disposing of them. Whatever niche market you sell in, chances are you can find some excellent deals on liquidated items that would nicely round out your standard product line.
It’s important, when buying liquidated goods, to know what type of merchandise you’re dealing with – closeouts, surplus, refurbished, etc. Advises Tom Schmidt, president and COO of Government Liquidation, LLC, “Certain types of secondary goods may require a little more effort, in the form of repairs, like salvage, or in the form of marketing, like customer returns, overstocks, or shelf pulls. But they also provide a chance to earn higher margins because you’re adding value to the products.”
Locating the Goods
One of the best sources for finding liquidated products is a business to business (B2B) marketplace, such as http://Liquidation.com or http://LiquidXS.com. You gain access to many different types of products and suppliers all in one place, including liquidated lots from suppliers that would normally not sell to small, individual retailers. When shopping B2B sites, make sure you’re only dealing with companies that have solid reputations. Some key characteristics to look for when choosing a marketplace are guaranteed prompt delivery, a range of shipping options, a secure financial settlement process, and good customer support. It’s also a plus if a site has multiple shipping locations – the closer you can have your product shipped from, the less you’ll be paying in freight costs.
Evaluating Your Profit Margins
To capitalize on the resale value of these liquidated goods, there are two primary figures you have to identify: