So you’re thinking about reselling and want to explore the consumer electronics category—that’s a good place to start! The demand is high for this inventory as it is part of most of our everyday lives. And the supply is definitely there if you know where to look.
Did you know roughly 20% of consumer electronics purchases are returned to the retailer or manufacturer? The two biggest reasons for these returns are complexity and lack of problem-solving. So essentially, the item is just too difficult to figure out how to use, or the product doesn’t solve the problem the customer was hoping it would.
Retailers take these customer returns and overstock inventory and then liquidate it. We go over what makes this category so worthwhile, different subcategories within Consumer Electronics (CE), and tips for reselling.
Reselling consumer electronics is a great business opportunity! Based on the concept of retail arbitrage, which is simply purchasing products from a retailer at a lower price and reselling it for profit. If done right, buyers-turned-merchants can sell the products at a much higher profit margin than the original discounted price.
So how do you get access to those returned consumer electronics? You head over to online auction sites and bid and buy on liquidation inventory! This inventory is deeply discounted and comes straight from retailers, conditions vary between brand new, like new, mixed, salvage, and refurbished. Always pay attention to the auction titles and manifest details. It will tell you whether the auction lot items are customer returns (dot com or in-store) or overstock inventory.
Consumer electronics for the home are skyrocketing. Especially for smart speakers and assistants. Roughly 1 in 4 adults in the U.S. owns a smart speaker for their home. And according to Amazon, electronics like the Echo Dot are among their best sellers.
Consumer electronics for the home include:
With more adults than ever working from home due to the global pandemic, coupled with a year of home-based learning, it makes sense that sales went up for consumer electronics. Strategy Analytics tells us consumer electronics revenues reached $358.8 billion globally, up 7% from 2019.
Items that make up this subcategory are:
In the last nine months of 2020 alone, Nintendo sold 24.1 million units of Nintendo Switches. And that’s just one gaming console. With new models and versions coming out multiple times in a year, plenty of these hit the secondary market in new and like-new conditions.
This subcategory encompasses a lot of different items. You can find:
So you know this inventory is in-demand and what kind of categories you can keep in stock, but how do you start reselling? And what are some best practices to follow? Consider the tips below for reselling consumer electronics.
Because each retailer has its own marketplace, condition descriptions will differ. It’s ultimately up to you, as a buyer, to read and understand each marketplace’s own set of conditions, which can be found on each marketplace. Be sure to learn more about condition codes before you start bidding on liquidation consumer electronics!
Be aware of any particular reselling rules from the retailer/manufacturer you’re purchasing from. In some cases, retailers or manufacturers will not allow you to resell the inventory in certain forums, online sites, geographic locations, etc. You can find these specific restrictions in a marketplace’s Terms & Conditions section (usually located at the bottom of the page).
You don’t want to accidentally win an auction for salvage inventory thinking you’ll be able to resell them as new.
To be profitable, you have to know what margins you’re looking for. It doesn’t make sense to overbid on inventory to then have to sell it for far lower than retail value. You want to maintain at least a certain margin of profit to make the effort of sourcing inventory, receiving, photographing, and listing it for resale worth it. Not to mention how much it will then cost to ship it out to your customers.
To determine what margins you’re after, use the manifest to do current market research so you know what the product is currently selling for. That way you can see how much potential profit there is for you by the time you factor in costs like shipping.
Up the amount of inventory you purchase at once and bid on LTL or full truckloads of consumer electronics! Some marketplaces, like Dell Outlet Auctions, even offer free shipping in the US.
Whether you make the repairs yourself or have a repair technician you work with, consider repairs and refurbishing as an option in order to resell consumer electronics for an even higher profit. Usually, refurbishers tend to buy in bulk. For instance, if a refurbisher has an opportunity to purchase 10 or even 100 broken iPhone Xs, they will buy those, fix them, and then sell them individually to customers in their stores. In many cases, refurbishers operate out of brick-and-mortar stores where they also offer repair services such as replacing broken screens.
The R2 Standard is the responsible recycling standard for electronics and it contains a series of requirements for reselling on the secondary market. Some marketplaces will require you to have this certification in order to bid and buy. This ensures you will ethically and properly dispose of electronics in case you can’t sell them.
Sourcing consumer electronics through B-Stock is easy! All you need to have in order to get started is your reseller certificate and then you can start sourcing from the best consumer electronics marketplaces out there.