Buying Amazon Returns and Overstock Online

Running your own online resale business can be very rewarding, but at times getting the right deals and buying the right merchandise to sell to your customers can be a challenge. Pricing can be especially difficult as you need to buy as low as possible to secure any kind of profit on resale. The prices that single items fetch when selling to end customers nowadays are borderline ‘wholesale’, which leaves a very tight profit margin to play with.

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If you specialize in electronics, you probably only want to deal with either new or nearly new items, instead of buying and selling used products. But sourcing electronic items in new condition requires a greater investment, and even if you have strong business connections to a number of wholesalers, it is hard to get the discounts that could help you stay competitive in the market.

You also need to consider the fast pace of turnover in the electronics market. A product that was ‘top of the lot’ last month is not in the top spot today. And six months down the line you may find it has been completely pushed out of the stores by brand new models. But these products do not lack quality and there is still a place for them in the market.

The question then is: how do you get your hands on these products to resell? How do you source products that maybe never got to a store’s shelves (overstock) or products that have been returned to the retailer and now have to be moved on to free up warehouse space (customer returns)?

If you are interested in buying quality products for a lower price, buying Amazon returns that have not been cherry-picked or overstock merchandise would certainly fit the bill. But where can you find a source that will provide you with a direct link to Amazon merchandise? Before we look for the best source for this kind of merchandise, we need to understand better what Amazon returns and overstock are and how you can benefit from them.

What are Amazon Returns and Overstock?

Returns

With the amount of merchandise handled by an e-commerce platform such as Amazon, and with 30 percent of all online purchases ending up back at the retailer, there is a significant amount of merchandise that gets resold on the secondary market and can be anything from clothing to laptops.

But to understand what sort of items these returns are and what sort of condition they are in, you have to look into the reasons why they are returned. Sometimes the retailer shipped the wrong size or color of the product, the customer expected the product to be different or the item delivered is not something the customer ordered. All these can be valid reasons for the merchandise to be returned.

You may be surprised to learn that of these returns, only 20 percent of buyers received a damaged product, 22 percent will get a product that looks different from what they think they ordered and 23 percent of buyers will get a completely different product sent to them.

On top of this, more and more customers are returning their products, damaged or not. This is possible due to the generous return policies many retailers have in place nowadays. In fact, the trend has been pushed by the market demand. Around 79 percent of buyers are looking for the free returns option and 67 percent of buyers will first see if there is a returns page before they look for a product to buy. This has pushed retailers to get creative with their selling process and you will find that 92 percent of buyers will buy a product if there is a generous return policy in place and 58 percent of buyers want to have a straightforward experience with no questions asked.

Overstock

Overstock, on the other hand, is slightly different. This is merchandise that never has been sold but was actually excess merchandise ordered by the retailer who misjudged the demand for the product. This means that these items are still in their original packaging and are basically brand new.

The market demand for new products does not justify keeping these products on offer for extended periods because the pace at which they can be sold is not enough to warrant keeping them in the warehouse of a fast-turnover business such as Amazon. Instead, retailers prefer to shift these products in bulk, in large orders of multiple truckloads, to free up space for new merchandise. This does not mean that there is no place in the market for these products and that you can’t make a profit by reselling them.

So now that you have a basic understanding of the terms, it is time to find Amazon returns and overstock merchandise at prices that will allow you to be competitive in any market.

Where to Buy Amazon Returns and Overstock Online?

You have been in the business for a while and your traditional channels, the wholesale suppliers are not cutting it, even with all the loyalty discounts you are getting. This is why you need to look for a new source that is reputable and can provide you access to Amazon returns and overstock at even lower prices.

One such website is Direct Liquidation. At Direct Liquidations online marketplace, businesses can source liquidated merchandise sourced from retail giants like Walmart, Target and now Amazon.

Why Amazon Liquidations?

Amazon is a Seattle-based ecommerce giant that saw its revenue reach $280.5 billion over 2019 with the company’s net income hitting $11.59 billion. The marketplace has over 300 million active users with over 2.5 million active sellers. Amazon has over 130 proprietary or private brands with some 422 brands sold exclusively on Amazon.

With the throughput that the company has, and the fact that 30 percent of all online sales are returned, Amazon ends up with a large amount of merchandise that has to be sold in what is known as the secondary market. The company needs to quickly shift the merchandise in order to free up warehouse space. To achieve these goals, Amazon makes use of liquidation companies capable of handling large quantities of customer returns or overstock merchandise.

This spares retailers the hassle and cost of processing and liquidating their own returns and overstock, while letting them extract some value from these products. This is where Direct Liquidation comes in as a liquidation platform that takes the burden of liquidating Amazon customer returns and overstock merchandise from Amazon itself. We are capable of handling the large quantities of liquidated merchandise.

Our open platform then allows resellers like you to buy smaller quantities of this merchandise, way below the usual MSRP – to sort and sell. Many of our unsorted truckloads of Amazon returns, for example, are sold in a buy-now format for only around 10% of estimated retail value.

Isn’t Liquidated Merchandise Low Quality?

The ‘scrap’ label gets thrown around very easily when it comes to liquidation merchandise. And it is a fact that a portion of liquidated merchandise consists of used, non-functioning and scrap items. However, Direct Liquidation works only with reputable retailers and top-tier companies. Names such as Amazon and Walmart are almost synonymous with quality products. So while a portion of liquidated merchandise is used, not working or only good for spare parts, this does not mean every lot you pick is scrap. In fact, between 45 and 70% of all returned merchandise comes back in a completely unused condition. And when it comes to untested customer returns, up to 75 percent of plug-and play electronics need no repairs.

Your ability to refurbish or repair merchandise yourself comes in handy in a situation like this. If you don’t mind fixing products and know your way around them, you could potentially score a higher profit by fixing the merchandise yourself, combining two non-functioning products into one that does, or using one product as a parts donor to repair multiple other products. It is a numbers, patience and skill game and you can directly influence the quality of the merchandise you resell.

When Direct Liquidation sells untouched returns on our platform, you can be assured that the merchandise hasn’t been sorted through and that it is listed and sold ‘as is’. This means that the retailers pack the merchandise and it remains untouched until it is shipped directly to our customers. With other pallets, including overstock, you are provided with a manifest, a packing list which will show you the number of items contained in a pallet, the type of items and a description of the items. So make sure you read through the whole list before buying. 

It is worth noting that merchandise sold through liquidation platforms such as Direct Liquidation comes in all shapes, sizes and conditions. Some products are resold without being tested; some, however, do get tested and even refurbished in-house at Direct Liquidation’s warehouses. These products are basically as new. These products are inspected and tested by qualified suppliers and brought back to ‘like new’ condition.

Products that have been refurbished by Direct Liquidation can come in various grades, but essentially they are operating ‘as new’ and also come with a 90-day warranty.

Overstock will be in a completely unused condition, and comes in either the original packaging or sealed in generic packaging, ready for resale. These items might come at a higher purchase price than untested returns, but you will know exactly what you are getting. They will be more attractive on resale and may fetch a higher resale price. In the end, you may find this stock below the price you are able to negotiate with your usual wholesale supplier. Make sure you do your calculations before purchasing any pallet of liquidated stock. The key to a successful business is research.

Liquidation Marketplaces Vs. Traditional Wholesalers

Wholesale suppliers deal with brand new merchandise that is acquired from the manufacturer directly and sold in-bulk to retailers with a markup. Buying in larger quantities reduces the price. This means that for smaller businesses, brand new merchandise, at the prices needed to make a profit, can be out of reach due to higher investment required. Customer returns and overstock merchandise are usually not sold as new, although they may come to you in original, unopened packaging. And the fact that it gets liquidated in large amounts, from the pallet to the truckload, helps with keeping the prices even lower. This is another reason why overstock merchandise is so appealing.

It is essentially brand new merchandise that never got sold, and that is now being liquidated, which is why the price is so low. When compared to untested returns, it does come at a higher price point, but you’re also looking at making more on resale.

On top of all these benefits, Direct Liquidation has dedicated account managers who will help you arrange purchases and find the merchandise you are looking for at the prices you are comfortable paying. They will even work with you on delivery schedules if you decide to make frequent purchases and will also help you search for a suitable delivery option.

And with Direct Liquidation’s established network of distribution centers, buying from those that are closest to you provides you with further opportunities to save. In some cases, you may even be able to arrange to pick the merchandise up yourself. This would also be a significant cost saver.

So, if you are looking to buy Amazon returns and overstock online, going through Direct Liquidation is probably the choice that will provide you the best shot at getting the right merchandise for your business while boosting your profit margins in the process.

Direct Liquidation is a goTRG company.

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