3 Categories You Can Make Highest Profit Margins with Liquidated Inventory

If you’re looking to get into the reselling game or expand your current business, you’re probably wondering which categories turn the highest profit margins. In other words, when it comes to buying and reselling liquidated inventory, where can you get the most bang for your buck?

In the world of liquidated inventory, there are dozens of categories to choose from to buy and resell. For instance: home and garden goods, mobile, groceries, clothing and accessories, auto parts, health and beauty, furniture, and many more. Essentially, If there’s a primary sales channel for the goods, chances are, there’s a secondary market for them also. So, let’s break down the top three highest profit margin categories of liquidated inventory: appliances, apparel, and toys. 

Buying liquidated appliances

When we talk about appliances, we’re referring to ‘The Big 5.’ These include:

1. Washers
2. Dryers
3. Dishwashers
4. Refrigerators
5. Oven/stove/cooktops

There are two primary reasons why appliances get returned. One, the unit is either the wrong color or size upon delivery; or two, minor cosmetic damage occurred during transport. These units are usually fully functional when they enter the secondary market as liquidation inventory– which is why ‘scratch and dent’ appliances make for a profitable business buying opportunity! 

Something to think about: 80% of appliance purchases are replacement purchases. This means shoppers are looking for a unit to bring home fast, usually within 24-48 hours. So, if you have the inventory on-hand… you can make the sale. ‘Scratch and dent’ liquidated inventory is historically easy to sell allowing you to move units quickly. And since all shoppers love a good bargain, many will happily sacrifice a small scratch for a great deal. 

Buying liquidated apparel

The market for liquidated apparel is hot right now. With the colossal rise of resale sites like Poshmark, ThredUp, TheRealReal, and others, reselling liquidation apparel has never been easier or more popular. 

According to a resale report from ThredUp (the world’s largest online thrift and consignment store), the secondary market for apparel is expected to double by 2023, reaching $51 billion. In fact, the demand for apparel in the secondary market is so large, it accounts for a whopping 49% of it! 

With the ease of online returns and try-before-you-buy programs, the amount of returned apparel is astronomical. And since returned merchandise can’t go back on primary shelves, it becomes liquidated inventory. This gives business buyers a huge opportunity to get brand name merchandise at a deep discount. 

Buying liquidated toys

Dolls, board games, action figures, plush toys… if it’s a toy, it’s in high demand. Whether you resell online or in a discount shop, liquidated toys are easy to sell and typically move fast! 

A huge appeal of liquidated toys is that a high percentage of the inventory is shelf pulls, overstock, or damaged packaging. This means that more often than not, the product is in like-new condition. Combine this with well-known name brands, high retail value auction lots, a good variety of toys in the lot, and high demand for the merchandise and buyers have a great business opportunity. 

Another upside of buying liquidated toys? If you’re just starting out, many retailers list auctions with just a few pallets of toys versus much larger less-than-truckload or full truckload shipments.