What Are Wholesale Liquidators
Ever heard the term; “wholesale liquidators” before? This refers to suppliers offering products for closeout, wholesale, surplus and overstock merchandise right in their warehouses. To cut the cost, they purchase their products from large retailers. But remember that even large retailers would add markup to their products, otherwise, they wouldn’t earn any profit. They will then sell back the inventory to closeout buyers.
On the other hand, auction liquidators are those who auction their excess merchandise and inventory. The great thing about this is that buyers are allowed to bid for the price and compete with the other customers who also bid. But unlike wholesale liquidators, auction liquidators sell their merchandise to small time buyers. They would look for a site where bidding will take place and even requires potential buyers to pay a certain amount of fee to be able to join the bidding.
Perhaps the terms liquidation and wholesaling can be confusing for you. Sometimes, these terms can be interchanged. When the company liquidates, this simply means that they are attempting to convert their assets into cash. This refers to their returned and overstock inventory. These costs a lot of the retailers’ money since obviously, stocks depreciate with age. On top of that, you can’t hoard unsold stocks in your warehouse since you have to clear some space for incoming new stocks too. Once stocks depreciate in value, this will mean reduced capital for your business as well.
Meanwhile, liquidators will often sell their products by bulk. And because it costs a lot, this is only offered to few large investors at a price lower than the product’s known MSRP. On the other hand, wholesale selling is the act of offering merchandise and goods to resellers as well as businesses. Stocks sold are also in bulk and once sold, will be retailed by the buyers. However, you need to know that true wholesaling is normally unavailable to a common consumer. Since these products are in bulk packages, wholesaler redistributes them in smaller lots. Unlike in liquidation, there is no bidding that will take place. Wholesale prices are fixed and products often came from large liquidators. However, the lots are broken into smaller quantities and redistributed in smaller packages to smaller resellers and retailers. That’s how some entrepreneurs make money these days. They purchase stocks from liquidators then sell them back through wholesaling. Indeed it can be tough to run a business.
You need to balance between keeping your commodities at affordable prices and still manage to earn profit out of it and keep your business afloat. If you are planning to start a business, you can purchase liquidation goods at a cheap cost which you can sell back for a profit. The first thing you need to do is to look for the right liquidator. The internet has bunch of them. Just make sure that you end up choosing an authentic site, reputed for years in the business. You will be surprised to learn how your capital will grow over time.