Clearance Stock vs. Wholesale: What’s the difference?

Choosing a source of inventory is a careful decision every business owner must make. Between clearance stock and wholesale options, it can be hard to weigh the pros and cons without a little bit of guidance. We’re here to break down the differences between clearance stock and wholesale goods, as well as their benefits for your business!

Clearance stock

Clearance stock is essentially surplus goods that are being transferred in ownership. When a company undergoes a stock clearance, it’s generally in order to make way for new inventory. Space is more valuable than owned inventory that didn’t sell or was returned. Retailers will take this clearance stock and sell it at auction to the highest bidder in order to recoup some of their losses.

Resellers purchase clearance stock at a fraction of retail recommended price (RRP) in order to turn a profit. These goods are sold off in job lots that can be either manifested or unmanifested. If the job lots are manifested, buyers can see item quantity and RRP, among other things.

Wholesale

Wholesale is the sale of goods and merchandise to resellers and businesses. The wholesale price is usually fixed and the amount of product can vary substantially. The goods are usually sold — by the wholesaler — in bulk quantities with the intention of being resold by the purchaser. Something else to note: true wholesaling is generally not available to the standard consumer.

Many wholesalers have direct relationships with retailers that allow them to purchase bankrupt or excess stock inventory before other smaller traders get to see it. However, this will usually end with them cherry-picking the best inventory and adding a markup. This means sole traders and resellers won’t see the best deal.

Benefits of purchasing clearance stock inventory

Demand on the secondary market

Retailers that your customers know and love are constantly offloading clearance, excess stock, and customer returns. These just move from primary shelves to the secondary market! In fact, top electronics and mobile devices can be just as popular on the secondary market as they are on primary ones. You will notice inventory selling out on primary store shelves become available via resale. For shoppers looking to save, buying like-new or used merchandise is likely to become more of an option.

Ex-catalogue merchandise

New merchandise will obviously fetch higher profits. Luckily, clearance stock also includes overstock (or excess) goods. Ex-catalogue goods that didn’t sell in-store or were used in displays and showrooms are available for resale as well. Additionally, you can find ex-chainstore goods to resell. This is merchandise from cancelled orders like those intended for major UK high street retailers.

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More diverse inventory

With clearance stock, you can attain more variety. For example, instead of getting the wholesale price for 400 of the same jumper, you can get a mix of seasonal clearance stock in women’s, men’s, or children’s apparel. Think of the different styles and sizes you can offer your customers.

Requirements for buying clearance stock inventory

To buy clearance stock, you must be a registered business and provide a VAT identification number. VAT stands for value-added tax and lets you buy job lots tax-free, with the expectation that you charge this tax to your customers when an item sells. For VAT exemptions and more information, visit this site.

A retailer’s returns, clearance, or excess stock is available on auction sites like the ones B-Stock operates. Once you submit a VAT identification number and register, you can start bidding on clearance and excess stock directly from retailers.

Source clearance stock on B-Stock

On B-Stock, retailers and manufacturers list their excess and returned inventory directly to an auction platform where registered businesses can bid and buy with ease. You get to choose how much you’d like to buy and at the price that works for you in an auction setup. So for whatever inventory your business is after, we’ve got your needs covered. Start browsing clearance stock auctions on B-Stock Europe today!