Tips for Starting a Successful Liquidation Business

in Business

Starting any business can be tough, but it’s worth the effort if you’re looking to start working for yourself. Being your own boss, calling the shots, and building a company that helps others are all exciting and worthwhile reasons to consider starting your own small business. One of the easiest ways to dip your toes into the world of business is by starting a side gig reselling a variety of items. By buying liquidated merchandise from wholesale liquidation websites, you can quickly and inexpensively purchase a variety of products to then resell on your own through the internet or a brick-and-mortar store. Here are some tips to keep in mind when starting your own liquidation business.

Do your research

One of the first things to do before taking a deep dive into the liquidation business is to do your research. It’s important to understand why merchandise gets returned to then be liquidated instead of resold. A common misunderstanding about liquidated merchandise — particularly items bought from online sellers like Amazon — is that it was returned because it was damaged. However, that’s simply not true. Many times there are products people purchase, such as clothing, that get returned for a host of other reasons. Maybe the fit of a sweatshirt was too tight or too big, or the color didn’t actually match the buyer’s shoes the way they thought it would when they looked at photos of the item online. All of these factors come into play when you’re buying returned merchandise, and most online websites will disclose what products, if any, have faults or damage in their listing of pallets available to buy.

Pick a niche

Another worthwhile tip to consider is what niche you’re interested in focusing on. While it may be tempting to try and purchase pallets from a variety of different product categories, you’ll be better served in the long run if you carve out your own niche. Maybe you’re already someone with knowledge about the fashion industry, and so it makes sense for you to focus on curating clothes from liquidation sales to sell. If you’ve got some technical knowledge and are able to refurbish electronics or use them for parts, it may be worth focusing on pallets of liquidated electronics products. Choosing a niche will also help you sort your pallets more effectively when they arrive, and help you identify what is worth selling and what is worth donating or saving for your next garage sale.

Buy low when you can

Many liquidation websites offer a bidding process on their pallets. The details of each pallet are limited, but generally give you a decent impression about what you can expect to receive in the mail. That said, it’s important that you remember that buying liquidated merchandise shouldn’t be thought of as a form of gambling where you could strike it rich just from luck. While some high-end items will ultimately cross your path if you stick with the business, following some common sense guidelines like buying your pallets at low prices and sticking to a budget will help your bottom line and your profit margins.

Purchasing liquidated merchandise can be a great way to jumpstart your dreams of starting your own business. Depending on the volume of the pallets you’re buying, you will also want to consider how you plan to store, organize, and transport your products. In situations where you’re buying lots of pallets due to their attractive prices, consulting with some experts like this material handling equipment company in New Jersey can be a big help. Many websites also have FAQs and customer support lines to also answer your questions. By making smart, informed decisions, you may even be able to turn your side hustle into a full on day job!

Image Credits: Brooke Winters

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