Throughout your business career, you have been buying and selling cheap wholesale merchandise to stock your online store. However, over the recent years, the market developed in such a way that due to a number of tools and lower purchase prices, single items sold on e-commerce websites like Amazon are edging ever closer to wholesale. Due to such a development, it is becoming harder for you to stay afloat, let alone be competitive, in the market. As a result, you have seen your sales, as well as your profit margin, dwindle over the period.
You have pretty much tried every trick in the book. You’ve been buying merchandise by the pallet through a number of online wholesale suppliers, showing your loyalty and getting all the possible advantages out of that. You have managed to work out more flexible payment terms, you’ve found the best possible shipping options and you have even negotiated lower prices with your wholesalers, but this has not helped you much.
The reason for this is simple. If you drop the purchase price, the quality of the merchandise you can buy decreases. For the prices that would make your business profitable, wholesalers are offering customer return pallets, but this type of merchandise is not something your customers have gotten used to. You pride yourself on selling brand new merchandise, and you have built a reputation as a reliable supplier of quality merchandise. So how do you keep that reputation without running your business into the ground?
The answer is not a complicated one, but you do have to change your ways. First, you will have to change the way you purchase merchandise, and you will also change the type of merchandise you purchase. While we say you will have to change, it does not mean you will stop selling brand new items, you will continue to do that, but it will not be through your wholesaler. Yes, you will change your supplier and look for closeouts and overstock merchandise to get your business back up and running.
The importance of understanding closeouts and overstock merchandise, and their similarities and differences is important because this is the merchandise that can help your business grow.
For the purposes of this article, let’s assume that you have been covering two very attractive markets by purchasing and selling clothing and smartphones. Clothing is a seasonal type of merchandise and is very often offered on closeout sales. What this means is that this type of merchandise has been on the shelves of a store, and has not been sold as the summer season turned to fall and further on to winter. Rather than just packing these items up and storing them until the summer season arrives the following year, stores sell these products during closeout sales. Those that don’t have a storage space large enough to keep these products for a longer period are looking to free up shelf space for the incoming merchandise and therefore are looking to sell fast.
The same principle is applied to smartphones or any other electronic device for that matter. With the development of electronics going at an incredibly fast pace, manufacturers are churning out new products very often to keep up with technological advancements and competition. This leads to retailers packing up and selling older models in closeouts to free up space for new models arriving. Now, while this development is moving at a fast pace, it does not mean the older models are not good. They are still very capable devices and there is definitely a market for them.
Overstock merchandise is sold the same way as closeouts. The only difference is that most of the time this type of merchandise never manages to get on the shelves. This usually happens when a store orders excess amount of merchandise and it remains in the storage space, unsold and more new products arrive.
And how could closeout and overstock merchandise boost your business? Well, if you read carefully, you must have noticed that no products have been sold or used before they are sold as closeouts or overstock. This means that these products are brand new, and sometimes you might get them with price tags still attached. Even better, these are sold at prices 25 to 50 percent below wholesale. If you do the math, this looks quite promising for your business, but where do you purchase pallets of closeouts and overstock merchandise, when large closeout buyers, usually wholesalers, snap this merchandise up by the truckload and then sell it on at wholesale prices? This is where you change your source of purchase, this is where you turn to liquidation companies.
Unlike your wholesalers, liquidation companies bring about a number of advantages for businesses that purchase merchandise by the pallet to resell online, making it possible not only to maximize your profit but to be very competitive. This is made possible first by the way merchandise is liquidated and how liquidation companies are set up, as well as by exclusive contracts liquidators sign with retailers and manufacturers looking to sell closeouts and overstock merchandise quickly.
First, liquidators don’t purchase the merchandise like the wholesale companies, meaning there is no markup to the wholesale price. Liquidators serve as a platform for retailers and manufacturers to offer their closeout and overstock merchandise to a wider online audience. This eliminates the wholesale markup and enables you to purchase merchandise by the pallet, or the lot. But it has to be stressed that it is imperative to work with reputable liquidators. Only a reputable and top-tier liquidation company will provide you with a manifest for every pallet or a lot they sell. A manifest is a list of items on a pallet, showing the type, quantity, and quality of the merchandise, meaning that you only buy the items you need.
In addition, the exclusive contracts ensure the high quality of merchandise being liquidated. One of such companies is Direct Liquidation, we offer closeouts and overstock merchandise from our Kentucky warehouse. This is another advantage for businesses close to Kentucky, as they can significantly reduce shipping costs, further increasing their profit margin.
So, buying closeouts and overstock merchandise, enables you to keep your purchase costs down below wholesale and still offer brand new merchandise to your customers. So go online and look for a reputable liquidator and browse the offerings.
Direct Liquidation is a goTRG company.
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Bid on bulk quantities of returned, overstock and refurbished inventory directly from Walmart
stores and Walmart.com.