Hi Aaman003,
There’s no real mystery about buying liquidated, closeout, surplus or
overrun merchandise, or any of the other names by which it’s called.
And you’re right to be cautious about dealing with companies that
claim to offer “liquidated” merchandise. Chances are it’s not at true
liquidation prices.
If you want to be the FIRST buyer of liquidated or closeout
merchandise, the only way to do it at the lowest, rock-bottom, truly
liquidated prices is to find it yourself and deal directly with the
manufacturer or distributor. As you correctly suspect, each layer
between you and the owner of the merchandise adds to the price, and
cuts into your potential profit.
Locating merchandise is simple enough, though not necessarily easy.
You get on the phone, or you write letters, or you send emails to
companies that might possibly have merchandise they want to get rid
of. This can be for a lot of reasons ranging from overruns, to
canceled orders, to mistakes, to returns or bankruptcy or lots of
other possibilities. You do this systematically, consistently, and
persistently, and eventually you’ll find something that somebody wants
to sell. Once you locate merchandise, you offer to buy it, or you ask
what they will take for it and, if it’s within your budget, you buy
it. Then you advertise it for sale OR you get back on the phone, or
take out your pen, or get online and search for a buyer in the same
systematic way you found your seller.
Another way to operate this business is to act as a broker. Find
excess merchandise first, then locate a buyer, then bring the two
together, (or vice versa) asking a small commission for yourself in
the process. This is a good way to break into the business without
having to expend a lot of cash upfront.
The above two methods are the only way to actually become the supplier
of liquidated or closeout merchandise. The offers you see online are
from those who have done this. Not surprisingly, they protect their
sources jealously, and you may encounter this when you try to break
into this business. Some companies won’t talk to you because they
already deal with established liquidators, but if you persevere and
are determined to make it, you will eventually build up your own list
of suppliers and your own “inside track.”
Here is a link to the Thomas Register, a comprehensive source of
information on U.S.-based manufacturers of all kinds of products, with
company and contact information. The site requires registration, but
it’s free, and can be a good starting point for building up a contact
list:
http://www.thomasregister.com
This company provides a list to worldwide auctions on closeout and
other merchandise. It costs to bid, but not to look. You might check
them out here: http://www.dovebid.com/default.asp
However, you do it, it’s going to take some legwork on your part, and
involve at least some outlay of money for phone bills, stationery and
postage expenses, internet access/internet service provider, and the
like. It will also take time to build up not only a list of sellers
and buyers, but also a reputation for honesty and fair dealing that
will bring you repeat business.
Here’s a link to an article with excellent information on how this
process works:
http://www.t-na.com/brkr/bizbook.html
Here are links to some books and e-books on this subject available for
purchase:
http://www.cricorp.com/surplus/profres.htm
http://www.amlinc.com/liquidation_101.htm
http://www.elearnaid.com/liqbusman.html
http://www.maxnetpromo.com/wholesale_liquidation/index.cfm
Link to some free business resources:
http://www.importexporthelp.com/free.htm
There are no special licenses or other legal requirements you need,
beyond those involved in establishing any business. Check out your
state requirements as far as filing a dba, opening a business bank
account, etc. and get to work. I wish you best of luck. Lots of
people have made lots of money in this business; there’s no reason you
can’t do the same.
If anything is not clear, please do ask for clarification before
rating/closing the question, so I can be sure you’re satisfied with
your answer.
Best regards,
--Byrd
In answering this question, I drew heavily on my own knowledge of this
business from having looked into it myself some time ago, and from my
memory of articles and reports I paid for at that time, which
unfortunately I no longer have.
Also, the following search terms were used:
how to find merchandise goods products liquidated OR liquidation
liquidation industry information
free information online finding merchandise liquidated OR closeout |
Clarification of Answer by
byrd-ga
on
26 Jan 2003 17:25 PST
Hello Aaman003,
I'm so glad you were pleased with the answer. Thank you for your kind
words!
In my own case, I purchased a kit from a company called the
Association of Certified Liquidators (ACL). I don't recall exactly
what I paid for the kit, but it was over $50. It included a print
newsletter and I was also on their email list for a time. The
directions and information sounded logical to me, and to be fair,
their information was clearly presented and organized. However, they
were selling more than information; they were trying to convince
people to locate surplus merchandise and then allow them, ACL, to buy
it. Or they said something to the effect that they would find the
buyers and split the profits with you. I don't recall exactly. It was
some years ago.
The main reasons I decided not to pursue it at the time were: 1) I
didn't entirely trust their scheme; 2) While I had no problem with
taking the necessary steps to locate merchandise, I didn't care for
having to also locate buyers since I really have no talent for sales,
and unless I chose to participate in ACL's program there was no other
option; and 3) At the time I had a very busy life as a single parent
with a fulltime (day) job and children's activities, etc. and just did
not have the time or wherewithall to spend so many hours on the phone
or writing/sending letters.
I've wondered about it from time to time, but for me reason number 2
still remains the most daunting challenge about getting into this
business. If you have no such limitation, all the better for you! So
since I never really tried it, of course I had no success. I still do
believe it's a viable business, but I also still believe it's one that
one has to operate alone and not in "partnership" as ACL proposed if
one is to suceed. Just for your information, here's a link to someone
else's experience with ACL:
http://www.friendsinbusiness.com/scams/acl.shtml
Again, thank you kindly, and I wish you all the best.
--Byrd
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