Buying Return Pallets: A Beginner's Guide to Starting a Resale Business

Have you ever wondered where all those returned products end up? Most of the time, retailers and companies end up liquidating them. This is where resellers come in, as buying return pallets is an excellent way to start a resale business. In this blog, we’ll go over the ins and outs of buying return pallets and how you can get started.

Where Do Store Returns Go?

In the past, big liquidators would purchase items in bulk and break down pallets to sell them to smaller buyers at a markup. However, in recent years, many retailers have bypassed traditional liquidation methods and adopted technology-based programs for excess inventory into their overall business plan. Liquiditys.com, for example, helps major retailers deal with their returns, excess, and liquidation inventory.

How to Buy Return Pallets Directly from Retailers

If you want to get your hands on these store returns, there are a few simple things to note beforehand. First, it’s essential to understand the difference between wholesale and liquidation. 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. On the other hand, liquidation typically means an organization is trying to turn excess, overstock, or obsolete goods into cash, quickly.

Start your search online, but purchasing directly from the source is always the best. Find official liquidation sites, as these are the best way to get inventory directly from the retailers and not a middleman. Plus, you can bid and win inventory at auction, and you only have to pay the price you want.

Secure a valid resale certificate, so you can purchase goods tax-free and pass on those savings to your customers. Of course, it is essential to charge sales tax later on during the transaction.

Carefully review the manifest and return conditions. Each retailer will grade their returns differently on their liquidation sites. Carefully review auction manifests and marketplace condition codes to understand what exactly you’re buying before you place a bid.

Picking the Right Marketplaces

Always keep what your customers want in mind when sourcing return pallets directly from retailers. Asking yourself what type of products your customers want will help determine what retailers’ returns to go after. For example, if your customer base is looking for home & garden tools and materials, retailers like The Kohl's and Lowe’s are good options. However, if you only have customers for apparel items, you would want to find a marketplace that caters to apparel buyers.

Types of Return Pallets by Category

There are different types of return pallets by category.

Apparel, Shoes, and Accessories Pallets

This category includes jumpsuits, rompers, denim, high fashion, moderate (basic tees, jeans, and skirts), contemporary (fast fashion and juniors), and traditional (suits and casual work attire) styles. Even loungewear, intimates, and sneakers are taking off!

Home and Garden Pallets

This category includes tools, small appliances, outdoor patio sets, grills & mowers, kitchen & bath, tubs & toilets, hardware, plumbing, flooring, wood/lumber, machinery, and more.

Consumer Electronics Pallets

This category includes laptops, tablets, cameras, televisions, printers/scanners, and gaming consoles to headphones, smartwatches, desktop computers, and Bluetooth speakers.

Casepack Truckloads

This category includes new and used merchandise in it's original box. Target is one of the key suppliers of Casepack Truckloads

Appliance Returns

This category includes returned, overstock, and scratch and dent inventory.

Each of these categories can have unique buying considerations, such as condition grading, product variety, and customer demand. It's important to do your research and understand the market you're buying for before making any purchases.

Advantages of Buying Return Pallets

Buying return pallets can be a lucrative way to start a resale business. Here are some advantages of buying return pallets:

• Lower costs: Buying return pallets can be significantly cheaper than buying products at retail prices.

• Variety: You can purchase a wide variety of products in bulk by buying return pallets, which can help you diversify your resale inventory.

• Profitability: You can sell products at a markup and make a profit when you buy return pallets.

• Sustainability: Buying return pallets can help reduce waste by giving returned products a second chance.

Tips for Success

Here are some tips for success when buying return pallets:

• Research: Do your research on the market you want to buy for, and understand the condition grading system used by the retailer.

• Plan ahead: Make a plan for how you'll sell the products you purchase, including pricing and marketing strategies.

• Stay organized: Keep track of the products you purchase and their condition grades to ensure you're accurately representing them to customers.

• Be patient: It may take some time to find the right inventory and build up your resale business, so be patient and persistent.

Conclusion

Buying return pallets can be an excellent way to start a resale business, but it's important to do your research and understand the market you're buying for. By following the tips outlined in this article, you can successfully purchase and resell return pallets.

FAQs

1. Can anyone buy return pallets from retailers?

• Yes, anyone can buy return pallets from retailers, but it's important to buy from a trusted source and understand the condition grading system used by the retailer.

2. Is buying return pallets a sustainable business practice?

• Yes, buying return pallets can help reduce waste by giving returned products a second chance and can be a sustainable business practice.

3. What should I consider when bidding on return pallets at auction?

• When bidding on return pallets at auction, you should consider the condition of the products, the quantity and type of inventory, shipping costs, and the retail price or MSRP for the items.

4. What are some popular categories for return pallets?

• Popular categories for return pallets include apparel, home and garden, consumer electronics, and mobile devices.

5. Can I make a profit by buying and reselling return pallets?

• Yes, you can make a profit by buying and reselling return pallets, but it's important to have a plan for how you'll sell the products and accurately represent their condition to customers.