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The question comes up time and time again in auction forums: "Where do you find your items to sell?"
Some sellers believe that the Holy Grail of inventory source is the closeout or liquidation, where a company is selling out-of-season stock or product returns. But there are horror stories out there about receiving pallets of items that weren't as described or contained only a few of the promised premium brands. Finding a reputable wholesale or closeout dealer can be a daunting task: the Internet is chock-full of them, and anecdotal reports are that some of them are overpriced or unreliable.
Liquidation.com has a unique business model for matching sellers of closeout merchandise and would-be buyers, where the buyers determine the price by a format that will be familiar to anyone who sells on eBay: the online auction. Liquidation.com doesn't actually own the goods they sell. Rather, they provide a service that matches sellers and buyers.
Liquidation.com has about 20,000 active buyers and hundreds of auctions at any given time. Every auction starts at $100, and there's no reserve. Sellers offer a wide variety of merchandise, including clothing, electronics, office supplies, and toys. "In a lot of cases we do sell new, brand-name merchandise: electronics, a lot of brand-name stuff, clothing," said Asad Haroon, V.P. of Marketing at Liquidation.com. "It's all there: anywhere from new, to used, to refurbished, to salvage."
Auctions close every two to three days, and Liquidation.com does not allow sniping. "Bidding will be extended every three minutes until there's somebody left standing," said Haroon. "It's positive because it doesn't allow somebody coming in and placing a bid in the last few seconds. Buyers seem to like that."
One such buyer is Jose Guitian of BargainMaze http://www.bargainmaze.com (eBay User ID: bargainmaze), who said he's "absolutely" been happy with Liquidation.com overall. He uses it along with other sources to acquire inventory, mostly electronics, watches, and sometimes toys. "The first time I bought from them, I took a chance," he said. "It turned out well. Overall, they deliver what they say. You have to rely on the description you receive, but most of the time it is precise."
The one time Guitian did have a problem with the merchandise not matching the auction description, Liquidation.com took care of it, he said. "They fixed it. The buyer had to take the merchandise back, and give the money back also." He did lose some money on shipping charges.
Guitian, who was previously in the restaurant business, has been successful enough with his auctions to become a full-time seller since November 2002. But he says he feels the market has been changing lately, with fewer overstock items and more returns. "The manufacturers are lowering the number of items they produce because they already know they're not going to sell that much. So that reduces the overstocks and everything."
Guitian lists about 100 items per month, with a profit margin of 30-60%. He does price research for every item he considers. "I just read the offers that are fully described, and try to make a judgment." He used to buy items that were new with warranty, such as overstock or discontinued merchandise, but says that lately he's not able to find them, and has had to buy returns. "I have to refurbish the merchandise to be able to offer a guarantee to my customers," he said.
Another online seller, Trey Howdy of White Tiger Software, buys and sells on Liquidation.com. "We have immensely enjoyed our experience with Liquidation.com," Howdy said. "As long as they maintain reasonable shipping and listing fees, they should quickly grow as the top source for quality overstock and liquidation goods in wholesale quantities." White Tiger Software sells computer software, toys, electronics, books, and more )http://www.whitetigersoftware.com), and is a Powerseller on eBay (eBay User ID: whitetigerauctions).
Whatever Liquidation.com is doing, it must be working: Paypal currently lists them as number one out of 500 bulk wholesalers in terms of PayPal volume. But if you're a buyer looking to get start selling wholesale, by all accounts, the watch phrase is "caveat emptor" ("buyer beware," for those of you who don't do Latin). Make sure you do your homework.
"Do the math," counseled Haroon. "Research the items and what they're selling for on various venues, such as eBay. Determine what is the maximum amount you can pay to resell for a fair profit margin." How much money you make depends on what price you pay for the goods.
For the savvy buyer who does the legwork and has skills in presenting and marketing the merchandise, it can pay off. Haroon said the majority of Liquidation.com's buyers sell on eBay, but they also use other auction sites or other venues such as their own Web sites.
"If you try hard enough on Internet with search engines, you can find several sources of merchandise," said BargainMaze's Guitian. "The problem is to decide which ones you want to try, and which might be a good opportunity for you."
If you are interested in learning more about buying or selling on Liquidation.com, visit http://tinyurl.com/ac65.
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