Reverse Logistics Guide
Reverse Logistics is the backward flow of the merchandise to its final destination. Major retailers like Walmart, Target, Home Depot, Lowes, and many other reputable Sources Discard of their Slow moving, Returned, and Damaged Packaging Shipments to a liquidation Company. Small or Large Business then buy this merchandise at a very low cost to stay profitable.
Pros of Reverse logistics:
*Your liquidation order can contain 100% to 500% Profit margin depending on how fast you get rid of the inventory.
*You Get Branded and quality merchandise for a fraction of the price.
*You may end up receiving a high quantity of brand new merchandise which requires less labor and is not time-consuming.
Cons of Reverse Logistics:
*A lot of times merchandise received can be heavily damaged or used so it cannot be resold again. The products are your loss and there is no way to recover from them.
*Most other types of products may have small defects or slightly used but functional. It requires time and labor to clean and refurbish these products and make them store Ready.
*You have to get rid of the defective merchandise and get rid of the trash yourself, if it is a large quantity then it can cost you quite a bit.
*You might receive outdated or expired products, such as calendars, make-up, Planners, etc.
Before you Get started: There is a problem, nowadays a lot of people are getting into buying liquidation pallets without doing enough research. It seems very attractive when you consider buying Branded products with an average of around $3.00 apiece, and you may sell expensive products fast and that seems lucrative. However, when you consider the defective products, the Average per product cost can go up to $10 or $15. The rest of the products will not sell for their original retail price because they will be sold as Open Box Condition or used condition. Some inventory may take up to a couple of months to get rid of.
Tips: According to market research, The only time we see a successful business in this field is when the business well-funded. Which means this business requires a warehouse facility for the process to take place, It requires multiple truckloads of liquidation orders. This way your per-item cost decreases, You can take a loss easily because your profitable merchandise will always be more because of the larger quantity. A large warehouse area also helps the reverse logistics process of product sorting and refurbishing.