This FAQ covers information regarding the Surplus/Liquidation Industry. We hope this helps to lessen some of the confusion regarding this industry. You will also find information on topics such as: How we operate, Payment terms, Services, etc.
Q: Surplus, Closeouts, Liquidation, Salvage, Returns...What is the difference?
A: Below is an explanation of the different terms.
Surplus is used to describe a broad area. This term may be used to describe closeout merchandise, used products or equipment, overstock or manufacturers overruns, irregulars or seconds, excess or slow moving inventory, salvage and returned goods, etc.
Overstocks or overruns may be due to many different reasons. Manufacturers may produce a larger quantity than actually needed for current orders. This is sometimes intentional, to make up for product that may not meet quality standards. These are new, first quality products. The products that do not meet the quality standards are referred to as "second's", as in irregulars, blemishes, and other defects in the manufacturing process. (Note: sometimes it is difficult to find the "defect" in some products.) Overstocks may also be due to a cancelled order or overestimating the market demand for a product.
Used and salvaged products and equipment are a big market. A lot of this is refurbished and sold for as much as 80% of the original retail price depending on the merchandise and warranties offered.
Closeouts are usually discontinued items. These are brand new items that are no longer being sold in their usual market. These types of items may be obtained from the manufacturer, distributors, or retail stores. As manufacturers change their products, labeling or other such things, they may sell off or liquidate the old product. They are not allowed to be sold to the manufacturer's normal distributors and retailers. The manufacturers may also require their distributors and the retail stores to get rid of the older version and replace them with the newer product. This is how these types of products make it into this alternate market at bargain prices. You get the brand new merchandise for pennies on the dollar.
Liquidations may be voluntary or forced selling of merchandise, equipment and property. This may occur due to business closings, bankruptcies, selling off obsolete, slow moving or distressed inventory, the need to increase business cash flow and many other reasons.
Salvage & Returns:
Salvage and Returns are much the same.
Salvage Goods are products that come from a variety of stores (department & hardware stores, etc.) and cannot be sold as new anymore. It may be a brand new product, but the box got ripped or someone put a scratch in it. Or it may be the result of a clerk opening a carton of cereal and cutting through a couple of the boxes. The whole carton may be considered salvage. If the cereal is past its expiration date, this would also be considered as salvage merchandise. The store cannot sell these types of products as new anymore, so they become SALVAGE.
Returns are items that have been bought and taken back for one reason or the other. In some cases the item is broken. In many cases the item is fine and was returned because it was the wrong size, color, etc., or the customer couldn't figure out how to use it, or saw it for less somewhere else, or many other reasons.
Buying Salvage and Returns may be one of the cheapest ways to buy merchandise, but it is also the most work and you have to determine your actual cost after sorting out the trash and time to repair other items. It comes down to breakage & junk versus the good stuff. You have to sort through the merchandise and determine what is good, what can be repaired and what is just thrown away. You may also be required to remove the Department Store tags before resale, or the merchandise may have restrictions and not be allowed to be sold in a particular area. Also some loads are "Blind" (they are not inventoried, or have a manifest.), so you don't always know what you are getting. There are good loads, and bad loads. Salvage comes from almost every major department store in the US. There are also stores that buy Salvage and Returns, (Some of them are very big names that we won't mention here) and other stores may try to resell their returns or slightly damaged products first, then sell off their "salvage and returns" that don't sell in the store. Of course, these aren't going to be very good loads.
You also have to be careful of who you buy from. There are some very reputable liquidators and brokers and then, there are some... well, you know, there are all kinds of people out there. Some liquidators buy these loads, take out what they want and then sell the rest. This is referred to as "cherry picking". You need to know the market and who you are dealing with.
We may offer Salvage and Returned goods on occasion. If and when we do, it will be clearly stated on our product listings.
Q: What if I find someone else selling the same thing you have, for less?
A: Please let us know. Normally, this is not going to happen, since we are usually DIRECT to the OWNER of the goods, in which case, we normally have an exclusive contract for the goods. Sometimes other brokers or liquidators see a good deal on one of our products and may try to market them, without any agreements with us. Some may even try to make you think they own the goods. (We have some of them contact us and tell us they are going to buy the goods, when they are actually brokering.) If this is the case, you will find that they are adding an additional markup to the products, so you won't be getting them for less. Please keep in mind that sometimes, others may be also dealing direct with some of our same clients (this does happen on occasion) and also offer the same goods, but we have rarely seen them offer the goods for less. We may have relationships with other brokers, but we have signed agreements in place. If they are offering the same thing, they will normally be quoting the same price, in order to keep the price as low as possible. In any case, please let us know.
All offerings are subject to prior sale. The prices we offer are usually the best (lowest) price we can offer and still stay in business. We try to deal quantity, not big profits. The more we sell, the more money we make. If you wish to make an offer, provide an LOI and state the price you're willing to pay.
Q: Can you locate merchandise that we may be looking for?
A: Yes, we may be able to help you locate those items you need. However, we require specific items and a target price. A request for general merchandise, fleamarket products, clothing, etc. are too broadly defined. We could waste a lot of time coming up with all kinds of items that may not interest you. A target price allows us to evaluate the likelihood of success. For top priority, provide us with a PO (Purchase Order) or LOI (Letter Of Intent).
Q: Do you Export?
A: We do not export. Export arrangements are the responsibility of the buyer. Shipment can be made to any place in the U.S., but the customs and final delivery is up to the buyer to handle.
Q: How do you accept payment?
A: We accept cash, cashier checks, money orders or EFT. All funds must be in US dollars. We prefer Electronic Fund Tranfers (EFT), also referred to as bank wire transfers. Buyers should notify us before and after they have transferred the funds. It make take up to 24 hours for us to receive EFTs. Once our bank confirms the transaction, we will make the arrangements to have the products shipped.
Checks may be accepted with a Bank Letter of Guarantee, however they must clear the bank before final consummation of the transaction and shipping arrangements. Funds must be drawn on a US bank. A Bank Letter of Guarantee must be on the bank's letterhead and notarized. The time period for the guarantee must be sufficient (at least 21 days) to allow for mailing, deposit and clearance of funds. This could take from 5 days to 2 weeks. Please check with us first.
All goods are subject to prior sale on a first come, first serve basis. If goods are sold prior to clearance of funds, only the price of the goods will be refunded. Any service fees, check charges, transfer fees or other types of expenses are born by the buyer and are not reimbursed or refundable.
Q: I still have some questions or need more information.
A: Please feel free to Contact Us .
We normally respond within 24-48 hours.
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