In this article, we’ll take a look at some of the pros and cons of retail returns and genuine places to buy Return Pallets and what’s required to buy direct.
What are Retail Returns & Return Pallets?
All the large retailers have one major issue in common: what to do with product returns? All major retailers offer a refund or exchange program for goods that don’t meet the customer’s expectations, which can be for several reasons. Large retailers are generally quite generous with their returns policy particularly for online purchases. Their customers might return items because they were (often by their interpretation) the wrong color, size, or not as described, while in other cases the item may have arrived damaged during freight, or may be faulty in some way.
Whatever the reason, these department stores, like Amazon, have an enormous amount of goods returned which could be in the range of 5-15% of their total sales that need to be liquidated.
That’s generally where third-party auctioneers come in. They receive all these returned goods, grade them, in some cases refurbish them, and auction them off to the public at big discounts to their original recommended retail price. In the first instance, these items are generally sold off in bulk as unsorted pallet loads of miscellaneous goods. From there, those pallet loads can be purchased by resellers who intend to sort the items, refurbish them, or sell them for parts, etc. In some cases, in between the retailer and this reseller are companies that handle the disposal of bulk returns on behalf of the retailer.
Where to Buy Retail Returns and Amazon Return Pallets?
Here is a list of auctioneers offering bulk, pallet, and truckload sales of retail returns, liquidation, clearance lines, salvage, and refurbished merchandise in the US market. Some of these auctioneers offer single items but most offer everything in bulk lots either by the pallet load, box lots, or even by the truckload. Many offer bulk lots of retail returns from major department stores such as Amazon, Lowes, Target, Walmart, and others.
- https://www.liquidation.com – Including auctions for new overstock products, retail returns, and salvage products from big brand stores such as Amazon, Walmart, Target, Home Depot, Wayfair, Sony, Bed Bath & Beyond, and more. They have auctions for individual products, pallet lots, and truckload lots. They have several warehouses across the US including Plainfield Indiana, Pittston Pennsylvania, Garland Texas, Cincinnati Ohio, North Wilkesboro North Carolina, and two in Las Vegas Nevada.
- https://bstock.com – Amazon’s direct liquidation outlet, BSTOCK also offers merchandise from big brand department stores including Macy’s, Sears, Dell, Amazon, and more. They generally offer bulk lots with items graded from A-D.
- https://www.directliquidation.com – holding auctions for retail returns, overstock products, end-of-life, and shelf pulls from major retailers and manufacturers. They also refurbish many of the products in-house marking them as “Refurbished” with a grade rating from A to C while also offering Untested Retail Returns and Salvage lines that are sold “as is”.
- https://liquidations.walmart.com – offering truckload and pallet loads of retail returns from their own group of stores. Lots are sold mostly in “Salvage Condition” meaning the item requires repair or is in used condition. You may also see used, new, and refurbished items. To buy from Amazon Liquidation Auctions you will need a state-issued “Reseller Certificate” (may also be called a Seller’s Permit, Sales Tax License, Sales and Use Tax Permit, or Certificate of Authority depending on your state).
- https://www.salesandauction.com – offering single item and pallet lots of merchandise and lost freight items. Some items are sold tested, and some are sold without any description of the condition. Based in Salt Lake City, Utah.
- https://rogueliquidation.com – holding live auctions every Monday. Based in Champaign and Decatur, Illinois.
- https://www.bulq.com – No auctions here, it’s all fixed price usually at around 50% off “original retail price”. Mostly listing retail returns that are generally sold in bulk lots, although, there are some listings for “like new” and new products. They have warehouses in Lebanon, TN, and Richmond, VA.
Amazon also has a new program for bulk liquidation in beta testing, you can apply directly at: https://www.amazon.com
Also, see our category and Retail Returns for auction notices.
A Word of Caution about Secondary Marketplaces
Be wary of secondary marketplaces selling return pallets! More often than not these are traders that have purchased from the the sites we listed earlier, skimmed off any high-value items, then repackaged the pallet and listed it for resale. These re-marketed pallet lots are often just a large waste of time quickly becoming costly as you will need to pay to dispose of what turns out to be more or less rubbish. This is a pallet you don’t want unless you can inspect it and see with your own eyes what value it still holds.
Why would you want to buy items that are faulty or returned?
Quite simply for the incredibly low price. The price is so low that either the end buyer is willing to accept the flaw, which in some cases may only be cosmetic, or if worse, have the item repaired. In some cases such as salvage electronics, the end buyer might be purchasing for parts rather than the whole.
This is also a desirable option for eBay sellers who can buy in bulk at a big discount, test and repair the items, and then remarket each one on eBay hopefully for a profit. How much effort they will need to put into each item will depend on the grade of items that they buy.
Buying refurbished or new items you should expect to be able to sell items without little effort and the discount comes purely from buying in bulk and buying without any warranty.
For untested returns, ungraded returns or salvage lots, more effort will be required which can mean “making one good one from two” or even stripping the items and selling as parts, or even remarketing in an “as-is” condition. This makes for the next important chapter
How are items categorized?
It is very important to clearly read the description of the lot you are bidding on. Super important, as no auction house of this nature generally offers any return policy, as you would expect. Clearly understanding the product will go a long way too. Each auction site has its own unique descriptive terms for product conditions which you can find more info about on their FAQ page. As a general guide
“New” Items marked new should be in original packaging, be as described by the manufacturer, and be fully functional. Most likely products with this label will be overstock or closeout lines.
“Like New” items are fully functional, and show signs of light use.
“Refurbished” are returned or used items that have been inspected, repaired if necessary, and tested. They may be factory refurbished or refurbished in-house. They may still have signs of wear, scratches etc. How much weight you add to the word refurbished depends on whether the seller also offers a warranty.
“Returns” are items that have been returned to the store and in most cases the reasons for being returned are unknown. It’s simply been mailed back or dropped off by the customer and sent on to the clearance warehouse/auctioneer. The item may have its original packaging and accessories or may not.
“Shelf Pulls”are items that were never sold in the retail environment. They should be unopened but may have some wear on the packaging or surfaces due to being on display for some time or from shipping.
“Scratch & Dent“ items that are still functional but have cosmetic issues, may also be missing manuals and packaging etc.
“Salvage“ items suitable for parts only. They generally don’t come with packaging, manuals, or accessories.
“Used“ the item functions, or at least should, but may have signs of age and wear.
Please check the listing for the lot you are bidding on and check the auction website for their description.
How to Buy an Amazon Return Pallet & Bulk Retail Returns?
BSTOCK, Amazon’s direct liquidation outlet, does require a tax exemption certificate, and for you to enroll in the Amazon Tax Exemption Program (ATEP), you will need to be a registered business/reseller with your local authority. Walmart Liquidations also requires you to be a registered seller (for tax purposes). You will need to check in your state (and in some cases local area) as to how to get your resale certificate/tax exemption certificate. Liquidation.com does not have this requirement as sales tax is applied to all items but you can apply for sales tax exemption if you are a reseller.
If you are an overseas buyer, some auction lots cannot be shipped outside of the US but many can.
Also, if you are buying a pallet or truckload then another very important point to consider is unloading. Drivers are not obligated to help and the window for unloading is usually limited and not all trucks have a liftgate. Check the requirements with the customer service dept, of the auctioneer before buying. Most will also allow you to arrange your own pickup.
Is it worth it?
The is a certain gamble to buying anything at auction, that is the very nature of auctions. With that in mind, the key is to try to lean things your way as much as possible by buying based on research rather than emotion. A mystery box can sound like fun, but a box of junk is just going to end up filling your garbage can.
Recommended retail is a useless figure to factor in the value that might be unlocked in a pallet load of goods, it’s much better to search eBay and find out what used items of the same type are selling for and then do the math.
Other important factors to consider are the final cost of the lot, plus any fees, plus the cost to ship it to your door. If you are reselling, then you’ll need to factor the total cost per item + risk factor vs the average price in the marketplace for the same item. You should be aiming for a margin that covers your time, handling, sorting, testing, repairing, repackaging, disposing of junk, etc, and delivers a profit.
Time is the important point here. There is little value in spending an hour to clean/repair an item that you are only going to make a couple of dollars profit on. One approach may be to focus on the items that are going to deliver the highest value then dump the rest into a mystery box and sell it off on eBay etc. This is more than likely to be what you see at many small local auctions with big boxes of “Amazon Returns” that have likely had the high-value items removed and sold off beforehand. Always try to be as close to the source as possible.
Another View
YouTuber Harison Nevel provides a genuine unboxing of pallet returns purchased via the services we listed earlier.
What if I only want to buy one item and not a whole pallet load?
Some of the sites listed earlier do sell single items, but a surer bet is Amazon itself. It isn’t prominent on the Amazon website as I am sure they would rather people buy new products at full retail price, but, there is actually a place where Amazon sells returns that it has tested and graded. See https://www.amazon.com/Warehouse-Deals/
Items are tested and graded into four categories “Like New”, “Very Good”, “Good”, and “Acceptable” and clear descriptions of the condition can be found on the item page.
The inventory isn’t huge and items sell out quickly, click on many items and they will show as being unavailable but if you are there at the right time the discounts can be in the order of 50% or more, for example here is an American Gourmet grill that retailed for $248.26 available in “Acceptable” condition due to having cosmetic issues and marked down to $115.79
*This post was originally published on: Oct 19, 2021 and updated Feb 12, 2024.
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