In a world where quality and price are the factors that determine the fate of your business, together with the quality of your service, buying from a national retailer will give you an advantage. This is especially the case if you are buying from the names like Walmart, Target or Lowe’s, which by themselves stand for quality. So if you are running a resale business, buying merchandise from these national retailers is a way to ensure you are providing quality merchandise for your customers.
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But is it a viable business option to go and buy at retail prices in order to resell online? Unfortunately not. So, how do you buy from national retailers in a way that makes business sense? Read on, here are some tips coming your way.
Buying in bulk is the age-old strategy. There are several benefits to this. By buying a large number of items, you are usually offered a discount, which means that, once you divide the load up into single items, you get a larger profit on resale. Additionally, having the products delivered all at once will save on the shipping costs. But this still does not answer the question where you can buy products from national retailers, so let’s look into sourcing the sourcing channels a bit more closely.
Traditionally, you are looking to buy from wholesalers. This is because these companies buy merchandise from manufacturers or retailers by the truckload and then sell the merchandise on to either end consumers or smaller buyers that can’t afford or don’t need to buy that much merchandise at once. You are advised to form relationships with a number of wholesalers as there are several benefits to this. First, you get to pick and choose the best deals, and then you are making sure that you have more options to source from in case one of the wholesalers goes out of stock. If that happens, you can always turn to the other ones.
Additionally, wholesalers reward their loyal, returning customers, so you might get better payment terms or some discounts, better delivery options or the right to pick the merchandise first once it arrives.
This is the traditional way that has been used for a long time. But in recent times, certain flaws have started appearing. The major flaw is the fact that if you are buying from a wholesaler in order to resell the merchandise online, you are barely able to keep up with the competition, or make a decent profit worth your time and effort. This is because prices of single items online are very close to wholesale. This makes you wonder, what if you could buy from the wholesaler’s source and skip the wholesaler’s markup. Because, let’s be honest, wholesalers will sell the merchandise on to you with their markup. So buying from their source would mean you are getting the merchandise at prices below wholesale.
That leaves us with buying directly from the manufacturers or national retailers. The first option is hard for anyone with a limited budget or just starting their business. Manufacturers usually have a very high minimum order requirement, which would mean a sizeable investment.
The other option are national retailers. Now, buying at retail prices is not a viable option, of course. But if wholesalers bought merchandise from retailers by the truckload, this means there is a way of getting to this merchandise at heavily discounted prices. So how exactly do you do that? Through liquidation platforms, specifically, through Direct Liquidation.
Now, hearing liquidation, you might be a bit on the fence about our reasoning, but do read on. In the olden days, liquidated merchandise was usually regarded as used, broken or scrap. It is no secret that a large majority of liquidated merchandise is still that, but things have certainly moved on in the liquidation world recently.
National retailers such as Walmart, Target or Lowe’s have their own liquidation departments and that merchandise you have been previously purchasing from your wholesaler has been sourced this way. Wholesalers turn up with their trucks and snap up everything a retailer is looking to liquidate. So what you were buying is liquidated merchandise that was reviewed by the wholesaler, sorted and repacked into pallets and sold to you.
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And you never had quality issues because you thought you were buying brand new Walmart stuff. You were actually buying liquidated products from national retailers. But, before we go further into sourcing liquidated products from national retailers, let’s look at how and why national retailers liquidate merchandise.
The likes of Walmart or Target have an enormous throughput of merchandise. A large portion of its is being sold online. But whether you buy online or from one of the physical stores, you are given a money-back guarantee and usually a 30-day return period.
Now, when buying online, people can make mistakes and all sorts of things can happen, an order is misplaced or wrong size is shipped to the buyer or the wrong colour. Sometimes, items get damaged during transport or the customer changed their mind before the product was delivered and they simply send it back unopened. Some people will also use the 30-day money back guarantee to the max and simply use the product and return it within that period for either a refund or as a trade in for something else.
But customer returns are not the only type of merchandise that gets liquidated. Items that were displayed in the store and never got sold are pulled off the shelves and liquidated. The same goes for the overstock merchandise that never even got to be displayed on the shelves of a store.
In any case, products that get returned, no matter what condition they are in, can’t be sold as A-stock and have to be liquidated. National retailers now have divisions that deal with customer returned merchandise and prepare it for liquidation. Products are usually reviewed, fixed and refurbished if needed, repackaged, sorter and packed up into pallets ready for liquidation.
Previously, you either didn’t want to do anything with liquidated merchandise, not knowing you are actually dealing with it, or you couldn’t get to it before the wholesalers did. Things have now changed.
National retailers have built a certain reputation and are trying to look after their customers the best they can, because a happy customer is a loyal customer. They previously dealt with wholesalers because that ensured they get the merchandise out the door quickly and free up space in their warehouses for new merchandise.
However, Walmart and Target have opened their storefronts on Direct Liquidation, a liquidation platform allowing you to skip the middleman/wholesaler, and buy merchandise directly from retailers at prices below wholesale. This allows you to secure a higher profit margin and to stay competitive in the online marketplace.
If you still have concerns over merchandise condition, you can request a manifest. This is a packing list which contains all the products information, the type, the quantity and the quality. Unless it says unsorted customer returns, this means the pallet has been reviewed and graded. This will allow you not only to pick the top quality merchandise, but also to pick only the merchandise your customers are looking for.
Additionally, if you’d like to save some more cash, you can narrow the search down to show you only the results for merchandise that ships out of distribution centers near you. This way you can either cut on the delivery costs or if possible eliminate them completely by picking up the merchandise you buy yourself.
So, if you are looking to buy liquidated products from national retailers, Direct Liquidation is a great source for you.
Direct Liquidation is a goTRG company.
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Diego works as a sales representative for Direct Liquidation helping businesses to source liquidation inventory from the world’s top retailers and manufacturers. Diego works with single pallet, LTL and truckload buyers directly to ensure they stay in stock with high quality inventory year round.
Schedule a sales callback with Diego right now and find out how he can help your business profit with liquidation merchandise.
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