Most liquidated products are similar across liquidators. But not all liquidators selling those products are created equal. A major downside to the reselling industry is that there are no guarantees, no promises. You don’t know much about the product until after you purchase them. As a result, an incredible amount of trust must be put into these liquidators’ hands. Most liquidators, fortunately, have a moral obligation to take care of customers. They do their best to be as upfront as possible about item conditions, sources (unless contractual obligations prohibit disclosure), etc. Others, however, are more concerned with their own bottom line, which inevitably will lead to the downfall of their business if changes aren’t made.
One major cause of burnout in a reseller is due to unrealistic expectations. What are proper expectations? How do you align your expectations with reality? And if those expectations aren’t met, how does one handle it? By taking this teaching to heart, the practicalities of reselling make more sense, and can lead to more profits and an enjoyable work experience.
Liquidator Business Practices
When You Purchase from a Liquidator, here is What YOU are Responsible for:
1. Asking Questions – Doing the Research Upfront for your Liquidators
Products vary from program to program. In most cases, the more popular brands of liquidated goods from major big box companies (such as Amazon) require contracts that the average reseller cannot afford or obtain. The contracts for such companies belong to four or five big players in the resale game. These top-tier liquidators sell their pallets to a select few second-tier liquidators, usually by the truckload.
By the time the pallets get to liquidators who are willing to sell single pallets or boxes to consumers, it has passed through the hands of multiple companies. The price points can be a sign that this has occurred. The higher the value of the pallet, the closer to that top-tier liquidator it came from and the less chance for extra processing or cherry picking. Because there is no regulations in place to determine how much a liquidator can price their pallets, you mustn’t rely on that price point alone to determine how many hands have touched your merchandise.
Ask questions about where they sourced products. They may be contractually obligated not to tell people the name of the business, or they may not want to, and that’s okay. You can ask other questions, such as, “are these liquidators also reselling individual items?” or maybe, “what has been your experience with the source of these pallets? Have you been getting helpful feedback on them?” It may take practice to learn how to ask the questions they can or are willing to answer, but once you do you can get answers to questions that help you make sound decisions. Remember, a large majority of liquidators business comes from repeat customers. They want to help you, but you must understand how to talk to them without putting them in a position where they must refuse to answer.
2. Making Sound Decisions from that Research
If you decide to purchase the goods, you are responsible for that decision. It’s up to you to ask questions, know your fees, and any additional information regarding the purchase. If you can see the pallet with your own eyes, do it. Being able to physically see what’s on the pallet can give you clear clues as to what the possible value is on each pallet.
I would not recommend allowing others to choose your pallets for you unless they have more than general knowledge of what kind of business you have and trust has been established. Business models vary from reseller to reseller. A “good” pallet to one reseller who sells on the local market may not be a “good” pallet to a reseller who purchases goods with the intent to sell them online. If you want to purchase a pallet, know that no matter how many questions you ask, what kind of research you do, there will always be a risk in that purchase. Be sure that you are prepared, no matter how unlikely, that the purchase you make may not be profitable.
Check out these additional blogs for more info about this topic:
– What You Need to Know Before Deciding What Pallet to Buy
– FREEBIE: Pallet Shopping Checklist
3. Reaching Out and Following Up – Constructive, Respectful Feedback
Reaching out is a fantastic way to give feedback to a business who has supplied you with a service. If you plan to return to that liquidator let them know how your previous pallet turned out and thank them for their help. Leave positive reviews on their Google and Facebook pages to help their business grow. Engage with their posts is another way to help support their business.
Keep in mind, each time you engage with the business, you’re building a positive cycle with them. This is a mutually beneficial relationship, and a key part of networking in your industry. In a previous blog, I mentioned why this would be beneficial.
If the pallet is not ideal, a good rule of thumb is to deal with that on a private forum. Before bashing them publicly, a thoughtful, well-educated, and professional message can go a long way. As mentioned before, liquidators rely on repeat business. If they truly made a mistake or miscommunicated a message, it would be in their best interest to make it right with you. If they do not, re-evaluate your decision to use them as a sourcing strategy. This is only applicable if you didn’t do your due diligence in researching the product before purchasing, please note that it is not the liquidator’s responsibility to undo your error in judgement.
What Makes a Liquidator a Good One?
1. Reputation for Conducting Business
It is a liquidator’s goal to make sales. But that’s more than just selling pallets at competitive prices and giving decent product. The way a company conducts business is a vital part of developing the business’ culture. When you walk into a liquidator’s business, everything from policies and procedures to employee attitude determines the culture of the business. Bad business practices will leak out into the public eye no matter how hard management tries to hide them. If you’re paying attention, you will see it.
2. Response to Feedback
All feedback– good or bad is important. Sometimes you may see undeserved or ludicrous feedback. If you happen to see that, how do they treat it? Pay attention to how liquidators respond to reviews, comments, and how they interact with customers. The words, tone, and phrasing they use can give clues as to what kind of culture you can expect from them when you do business.
3. Taking Responsibility for Mistakes
Making mistakes does not make a liquidator a bad one. It makes it a business owned by human beings. Judging a business by one encounter isn’t always wise either. But if the business makes a habit of taking responsibility when they do make mistakes, you can bet that they have a deep-rooted respect for their customer base and will treat you well.
Why Should You Bother Networking with Possible Liquidators?
It takes practice to learn how to develop business relationships. Refining the skill can be mutually beneficial for both you and your sourcing liquidator. The heart behind good network building is not just to protect your business, but to protect your liquidators’ as well. By building this trust, it opens more opportunities for you to reach new liquidators and new sources. You’ll have access to more information when you show yourself trustworthy and honest.
On the other hand, liquidators can benefit from that trust as well. Knowing that you are willing to protect their business, be open and honest with your feedback, and willing to use your resources for their gain is what makes a good relationship. Opportunities for collaboration, beta testing latest programs, and being the first to know when products come in are just a few possible opportunities that could open to you if you choose to network properly.