We all love Amazon’s customer returns policy, right? I mean let’s be honest, you can return or exchange pretty much anything for free. Very customer-centric indeed. But while this is convenient for consumers, it also leads to an influx of customer returns that can no longer be relisted as new. This opens up huge opportunities for reselling! In this post, we cover why customer returns are liquidated and how you can bid and buy Amazon auctions.
You might hear that your favorite retailer is “liquidating” and start to worry, but there’s no need. This doesn’t always mean that they are going out of business! Another reason companies liquidate is for the purpose of offloading excess inventory and mounting customer returns. This is a natural part of reverse logistics that nearly every business faces.
Reverse logistics is at the end of the supply chain when customers purchase and then return products. Retailers sometimes discount items in-store, and other times, sell the returns off in bulk. These retail liquidation pallets are similar to those offloaded by companies going out of business. The difference is that these companies remain in business.
If it sounds silly to sell products at huge discounts, consider the cost of having goods sitting in a warehouse taking up precious space. That’s what has made liquidation a normal part of a business’s reverse logistics plan. Those seasonal and overstock goods, along with damaged or returned items are collecting dust and could otherwise end up in a landfill. Some items end up on Amazon Warehouse for a discounted price, but many end up on large liquidation websites that sell pallets and even truckloads of returned items.
With liquidation, companies can still make a profit from this merchandise while freeing up storage space for new inventory. This provides small businesses and resellers looking to purchase name-brand inventory—for pennies on the dollar—a great opportunity.
Once big retailers like Amazon decided to start liquidating to offload this returned or overstock inventory through their online marketplaces on B-Stock, we became the bridge between sellers and buyers. As a B2B marketplace that sells bulk quantities of customer returns and overstock merchandise, small business owners know they are getting inventory directly from the source.
We help facilitate transparent transactions without the fear of middlemen liquidators selling to you at a markup and cherrypicking the best inventory for themselves. By using an auction model that is fueled by bidders like yourself, you know buyers are putting in their most competitive offer. All while still reaping the benefits of deeply discounted liquidated inventory. Remember, you make your profit when you purchase. If you can get it for low, sell it for higher, you’ve got yourself some good margins.
You will need to have the right documentation to show that you are a reseller. This allows you to purchase liquidated inventory from Amazon auctions tax-free. It’s then your responsibility to collect the tax from your customer when you sell the item. If you do not currently have a reseller certificate, head over to Buying Basics: Resale Certificates.
There are a few ways you can buy liquidated Amazon items: in bulk, by the pallet, or truckload. The larger the order, the bigger the discount. Items are either sold at a fixed price or through an online auction marketplace (like the ones B-Stock operates). This alternative will save you time spent sourcing each piece of inventory one by one and you know it’s coming from a retailer that consumers already know and love.
It’s common for online retailers to see nearly 30% of products ordered online returned, as compared to less than 10% in brick-and-mortar stores. Only when it comes to online retailers, sales are growing exponentially every year. So, you can imagine the number of returns. In many cases, online retailers will not put the items that are returned by customers back on virtual shelves.
This is where you, the buyer, come in! Those online liquidation auctions we talked about earlier? Resellers who purchase these lots can get steep discounts on products from big brand names. Some auction lots will be all of the same category, such as a pallet of dresses or a truckload of pet products. Other lots are mixed and contain various goods in varying conditions. Be sure to read all of the manifest details about a given lot before bidding on it.
Not only will you find customer returns on online marketplaces, but Amazon will also sell its warehouse damaged, found items, and even salvage items to third parties. Keep in mind, though, these third parties include other liquidators who have their own companies that they buy in bulk for. As a result, they may sell leftovers or less valuable items to the public. Be wary of some wholesalers or liquidators who might be trying to sell junk. That’s why reading seller reviews is so important! You want to ensure the quality is as advertised and that sellers have generally positive reviews. Or, as we said earlier, you can buy straight from the source.
By going through B-Stock, you can expect inventory coming directly from retailers and sellers with reputable reviews. Granted, there is always a risk when buying Amazon returns pallets and liquidation merchandise, considering you won’t have control over resell market trends or the number of resalable items you’ll receive. You should always play it safe and start small and see how you do. The opportunity exists to hit gold when purchasing return pallets to resell, which adds to the thrill!
Register for Amazon Liquidation Auctions to start bidding on bulk lots of a wide variety of products including apparel, home & garden, recreation, and toys & baby items today!