The Nuts And Bolts Of Liquidation Reselling Liquidated Items Online
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The Nuts and Bolts of Liquidation: Reselling Liquidated Items Online
Summary
Liquidation can be a profitable avenue for online sellers seeking new product sources. When large retailers, wholesalers, or manufacturers need to offload excess inventory, they often sell it far below wholesale prices to recoup some costs. This presents a fantastic opportunity for e-commerce businesses to diversify and expand their product offerings.
Understanding Liquidated Goods
Liquidation involves various types of goods, including closeouts, surplus, and refurbished items. Tom Schmidt, president and COO of Government Liquidation, LLC, highlights that some secondary goods may require extra effort, such as repairs or additional marketing for customer returns or overstocks. Despite this, these goods offer higher profit margins as you add value to them.
Finding Liquidated Products
Business-to-business (B2B) marketplaces like Liquidation.com and LiquidXS.com are excellent sources for liquidated goods. They provide access to a wide range of products and suppliers, including those that typically do not sell to small retailers. Ensure you deal with reputable companies that offer prompt delivery, secure payment options, excellent customer support, and multiple shipping locations to minimize freight costs.
Evaluating Profit Margins
To make the most of liquidated items, identify two key figures:
1. Resale Value: Determine the condition and potential resale value of the items. Research on business-to-consumer (B2C) platforms is essential for understanding the market value and developing a selling strategy.
2. Total Product Cost: Consider all costs involved, including the product, logistics, marketing, and any necessary refurbishments. If these costs are significantly lower than the resale value, you have a potentially profitable item.
Benefits of Liquidation
Integrating liquidation into your sourcing strategy keeps your product selection fresh and attracts repeat customers seeking unique finds. Additionally, it can provide high-margin items and loss leaders. According to Schmidt, the $65 billion liquidation market can be a goldmine for online entrepreneurs.
By exploring liquidation, you can seize opportunities to enhance your product lineup and increase profitability, making it a compelling option for any savvy online seller.
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