Secondary Market Insights

Skyrocketing return rates brought on by the growth of ecommerce and buyer expectations of no-hassle, cross-channel return policies are forcing retailers to rethink their reverse logistics programs in order to remain competitive. Consider this: by the end of 2017 the value of retail returns will be equivalent to total online sales — around $440 billion. That’s an eye-popping number that can’t be ignored, especially considering the bulk of it won’t be returned to store or virtual shelves, but rather be marked for liquidation into the secondary market.

Consider this:

  • In 2016 the secondary market was estimated at $540B
  • The secondary market represents over 3% of the US economy and is growing 8% annually
  • 95% of returned and excess inventory will end up being sold on the secondary market
  • In every major city around the world there are businesses that purchase customer-returned inventory for resale

When it comes to secondary-market-bound returned merchandise, it’s crucial for retailers to understand the true value of it and how best to infiltrate the secondary market in order to get the most recovery for the merchandise. Traditional methods like selling to a single liquidator or wholesaler for a pre-negotiated price will always leave money on the table.

Often there is an opportunity to recoup more – 30-80% more – simply by ditching traditional, manual methods and applying newer technology-based methods that sell directly to secondary market business buyers. For example, a web-based solution, in the form of an online auction B2B liquidation marketplace, makes it just as easy to have thousands of buyers compete for the inventory, pushing prices up versus having a single liquidator negotiate them down.

It’s clear a robust secondary market and buyer base already exists for returned products; the key is the ability to directly access this base of buyers. This is where B-Stock comes in: by combining technology-based online auction marketplace platforms with our highly experienced team that understands the secondary market, auction strategy, and demand generation we are able to provide the world’s largest retailers with a winning formula.

For more information on how we connect our clients’ returned and excess inventory directly to secondary market business buyers, enabling a 30+% increase in recovery, please contact us.