Beginners Guide For New Buyers of Wholesale and Liquidation Pallets

Beginners Guide For New Buyers of Wholesale and Liquidation Pallets

Daniel Hall 03/06/2021
Beginners Guide For New Buyers of Wholesale and Liquidation Pallets

Whether you are launching a brand new business or opening an additional revenue stream to get you through the challenging times that COVID-19 has thrown at you, wholesale and liquidation pallets could be your next venture. 


When setting up your warehouse, you can rely on the expertise of SJF Material Handling to provide top-quality equipment and solutions tailored to your needs.

Although the concept of wholesale and liquidation pallets is synonymous with companies that are going out of business, in many cases, they opt for pallet liquidation to get rid of excess stock. They could be coming to the end of a certain stock line, have a large amount of reverse logistics to cope with or have discontinued and even dud items that cannot be sold from the brand name at full price.

These can be auctioned off to bidders at a highly discounted rate, who will, in turn, resell them to make a profit. These discounted pallets are ideal for start-up retailers or e-tailers, discount stores, flea markets, vendors and online resellers. 

This is a more scalable model for resellers than buying from thrift outlets, auctions or garage sales due to the fact that you can buy in bulk. And once you start turning over the products, you can start making a significant profit. 

Find the Right Platform To Buy From 

There are a number of online platforms that sell liquidation and wholesale pallets. These are not only easy to find, but it is a simple process to get signed up and registered as a reseller. The key is to ensure that the platform that you are signing up to is valid and reputable, so make sure you do your due diligence and research before waving your money at it. 

Next, you will need to get registered with them, as well as ensure that you are a valid reseller. In some cases, you will need a permit for certain platforms, and even products to resell, so delve deeper into what you need to set up before launching into the purchasing stage. 

It is also important to know in advance what platforms you will be selling on when picking your supplier. Amazon, for example, is not very forgiving when it comes to first-time resellers. They might require invoicing and manufacturing certificates for various items, and if you are buying liquidation pallets, especially in bulk, you might not be able to attain these documents.

Finding a quality Chinese wholesale supplier is important when reselling, and it can be done by doing your research prior to purchasing any products. Make sure to find a Chinese wholesale supplier with a good reputation and history in the industry, as well as an international presence if applicable for selling overseas. Additionally, contact customer service or ask around in forums to learn more about a supplier's policies and procedures. 

Know What You Are Buying 

It is important to consider the stock that you are about to buy and understand why it wasn’t selling in the first place. Why is this stock now being sold en masse on auction at highly discounted prices? 

If you are buying products from a business that is shutting its doors, you are more likely to find high-quality products that the store simply needs to sell to balance its losses. 

Overstock, on the other hand, would have sold, but is either seasonal or could possibly be at the end of their viable sales timeline. This could work in your favor when selling at a drastically reduced price, or you could have missed the time frame, and be stuck with a large quantity of items no one wants.

The most coveted items are new, branded goods that are in great condition and are in high demand. Electronics certainly rank high in this category, with home goods falling shortly behind. You can also opt to specialize in the resale of particular items and build your brand and itinerary this way. 

Strategize Before You Buy

Shopping around and attending a few of the auctions before buying is highly recommended. You will be able to get a firm grasp of what is being sold off in general in the market and the general quality of the products. Tie this up to your target audience. Electronics are usually a very in-demand item due to the fact that you can either sell them as a whole or purchase them to sell their parts. 

Consider where you will be selling the product, who you will be selling it to, what the price points are, what the demand is for the products and how you will be shipping, storing and transporting the items. If you don’t have warehousing or long-term storage facilities, you will need to be looking into products that are turning over in a short space of time.


Circumnavigate the Pitfalls 

Next, be aware of the smaller things that might make it difficult for you to move your newly acquired stock. Although there are a number of online platforms for you to sell on like Amazon and eBay, some can get quite difficult when it comes to reselling items. 

Make sure you have a reseller's certificate in place, invoicing, and if possible, manufacturing certificates. This is most likely not going to be possible if you bought liquidation pallets, so you might find certain sites like Amazon might block your sales. eBay is a lot more forgiving, but if you find that you really get stuck selling online, go and look for flea markets. 

Be careful about getting your account shut down by platforms like Amazon. If you are selling mass products for a relatively cheap price, you might get reported for selling counterfeit items, and your profile could be suspended. Lower-end unbranded items don’t sell well online, so look at selling them physically, in a dollar store, or in flea markets. 

What you will also need to keep in mind is the fact that reselling masses of cheap items may require more time and effort than it is actually worth. You will photograph the individual products, upload them, create profiles and descriptions, and then when it comes to it, package and ship them individually. For smaller items under $10, for example, this may not be worth your time. 

Last Thoughts 

Should you spend some time and effort doing the right research and due diligence before launching yourself into this, you could create a highly lucrative business. You will find various key learnings on the way, and ascertain what can make you money and where you could lose money. Our key advice is to not make impulse purchases and rather have a solid business plan in place to drive your brand to success.

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Daniel Hall

Business Expert

Daniel Hall is an experienced digital marketer, author and world traveller. He spends a lot of his free time flipping through books and learning about a plethora of topics.

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