Shoppers are used to seeing sales and retail clearance in stores, but it’s where the inventory goes afterwards that is the interesting part… in particular, what interests aspiring resellers like yourself! The most common way for retailers to offload marked-down merchandise is via private liquidation sales or clearance stock auctions. Resale businesses and sole traders can profit off of retail clearance by purchasing inventory in bulk and reselling those goods closer to RRP (recommended retail price).
Now that you know retail clearance, or clearance stock, is a method for businesses to markdown and get rid of certain inventory, you will want to know what condition that inventory might be in, where you can get it, and then how to resell retail clearance and turn a profit. Let’s dive in.
Why resell retail clearance?
There are many reasons an item might be marked down for clearance; seasonality, over-purchasing, discontinued lines, and obsolete and out-of-date goods to name a few. There’s also the matter of customer returned goods, too. Returned merchandise may be marked down in stores, or retailers may choose to forego inspecting and repackaging items and choose to offload them via clearance stock auctions.
If you ever ordered three shirts from Amazon, two in a different colour and one in the next size up, and then only ended up keeping one, then you know returns can be in near-perfect condition. This is just another reason why reselling retail clearance is so worthwhile!
Find and secure your inventory
We’ll summarize a couple of places you can find inventory and what you will need to do in order to buy retail clearance in bulk.
Where to look
- Directly in stores – Before clearance goods get auctioned off, some retailers choose to discount the goods in stores. These will usually be in a particular section of the store and labelled as clearance. This method works best for resellers who are sourcing individual pieces of inventory. However, it can be incredibly time-consuming. If you want a more efficient, bulk solution, you have better chances online.
- Online liquidation sites – B-Stock lists liquidation inventory for retailers that need to sell their retail clearance by the pallet or truckload and quickly. This means inventory comes directly from a retailer and not through the hands of jobbers and other liquidators. With an auction set up, you get to see what others are bidding for that same inventory. There aren’t any closed-door deals where additional markups may incur.
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Prepare the appropriate documentation
In the UK and the rest of Europe, you will be required to submit a valid VAT identification number. VAT stands for value-added tax and lets you buy job lots tax-free, with the expectation that you charge this tax to your customers when an item sells.
Have a good formula to actually see profits
Carefully consider how much you’re willing to pay, what those particular goods are selling for on the secondary market, and how much shipping will cost. If there’s a manifest available, this document can give you a detailed look at item descriptions, quantities, RRP, and more. When you have a good formula for how much you can spend and resell retail clearance for, you have a clear picture as to what your profits will come out to. If you don’t, you may risk breaking even on what you paid for your lot!
How to resell retail clearance
Abide by any selling restrictions
Retailers who are concerned about brand integrity won’t want to see their clearance stock being resold with their name attached to it. In that case, delabelling may be required of resellers. For boxed items, it could be as simple as drawing a line through the UPC code on the box or removing the item from its packaging. For clothing, it could involve removing sale tags and labels or drawing a line through the label inside the clothing piece.
Or, there are instances in which the retailer will require inventory to be exported and sold in a different country in order for clearance goods to not compete within their primary markets.
Try selling on different channels
If you’re not getting the profits you’re after on one marketplace, try another! It’s important to do your research and see what secondary channels might work for your type of inventory. Users will be much more willing to pay top dollar if they understand the value of that item versus someone who may not. For example, designer apparel and handbags do really well on apparel-focused sites like Depop or Vinted. On the other hand, consumer electronics and mobiles may sell better on eBay where buyers are more likely to see similar inventory.
Reselling online in the UK? Check out our other post 11 Best Sites to Resell Online (UK).
Make reviews readily available on your site
Any reseller will tell you how important it is to keep a good reputation and address any negative feedback. Online, it’s even more critical. According to Statista, nine in ten UK consumers said they would check online reviews before deciding to buy from a particular business. That’s why you should make it a top priority to leave your customers with a positive experience.
It can start with a detailed product description (in order to avoid any surprises) and finish with a coupon to come back. It’s a good habit to ask for feedback, too. That way you can make improvements and acknowledge any concerns. You don’t want word getting around that you don’t value your customers’ experience when purchasing from you. Or worse, that you intentionally tried to deceive shoppers on the quality of goods or where they’re from.
Start with the right inventory on B-Stock
Before your reselling efforts are a huge success, you will need to secure the best inventory suited for your business. Retail clearance goods, or bulk goods sold off by retailers at a discount, run rampant on B-Stock! You may choose to source through an individual retailer’s marketplace, or through our very own, B-Stock Supply Europe (where you can shop across hundreds of categories from thousands of sellers, all in one place). UK buyers must submit a valid VAT identification number when registering to individual marketplaces and then wait for approval. Start bidding on retail clearance auctions today!