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By David A. Utter
EcommerceBytes.com
January 19, 2015
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EcommerceBytes-NewsFlash, Number 3497 - January 19, 2015 - ISSN 1539-5065
Seasonal Returns Provide
Product-Sourcing
Opportunities
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28
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Despite a recovering economy, US shoppers still found enough money on
their credit and debit cards to drop $601.8 billion in retail spending during
the recently completed 2014 holiday shopping season per the National
Retail Federation. While we can't know the depth of thought and
consideration that took place with those buying decisions, we do know that
plenty of people took the opportunity to return a variety of items.
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That returned merchandise presents an opportunity for adept resellers.
Firms like B-Stock Solutions and Liquidity Services Inc., which operates
Liquidation.com, engage in managing the items that go back to the returns
counters of stores like Walmart and Costco.
Such items end up in the online marketplaces managed by these
companies on behalf of the big name retailers, selling returned items in
bulk auction lots online. Eric Moriarty, VP of sales for B-Stock Solutions, told
EcommerceBytes.com his firm sells over 500 bulk lots of merchandise
every week across their marketplaces, comprising hundreds of thousands
of items.
"Consumer electronics including TVs and mobile devices are a huge product
category for us, followed by apparel and appliances," he said.
After the holidays, Moriarty said approximately 10 percent of holiday
purchases are returned. While he noted their marketplaces in particular see
a rise in merchandise mid-January through March, "the time span is due to a
few factors including: internal policies set by the retailer on how returns are
handled, the retailer's warehousing and logistics bandwidth, and a delay in
returning the item by the consumer."
Profitability for resellers of returned merchandise will be affected by a
number of variables. Moriarty listed ones like the reseller's channel of eBay,
Amazon, or however they opt to make those items available for purchase.
Any value the reseller adds, like refurbishing, can have an impact on profit
margins, as does overhead and item condition according to Moriarty.
Though the margins will vary, with some sellers seeing triple digits on a perunit basis while others will see much less, Moriarty's firm enjoys customer
loyalty as he noted they have seen "a high buyer retention rate across all
categories, condition codes and sizes."
Online merchants intrigued by the business possibilities and who want to
get involved can register and bid on returned and overstock items from
retailer and manufacturer "private-label auction marketplaces."
"In most cases, we are enabling something that most resellers have never
experienced. That is, true direct buying from the largest retailers and
brands in the country," Moriarty said.
Related Stories
Seasonal Returns Provide Product-Sourcing Opportunities - January
19, 2015
Sourcing Local Gourmet Foods to Sell on eBay and Amazon - June
23, 2013
Fair or Foul? Tips for the Antique Picker - June 17, 2012
Product Sourcing - Life Returns to Largest Wholesale Trade Show March 29, 2012
About the author:
David A. Utter is a freelance writer based in Lexington, KY. He has covered
technology topics from search to security to online business and has been
quoted in places like ZDNet and BusinessWeek. He considers his
appearance on NPR's "All Things Considered" with long-time host Robert
Siegel a delightful highlight. Send your tips to [email protected] and
find him on Twitter @davidautter and on LinkedIn.
You may quote up to 50 words of any article on the condition that you attribute the article to
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