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THIRD PARTY LOGISTICS STOCK |
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The Art of the Deal: Negotiating Closeouts, Overstock, and Excess Inventory
The world of commerce is filled with challenges. Sometimes, products overstay their welcome on shelves, production forecasts go awry, or seasonal shifts leave businesses with unwanted merchandise. This is where closeouts, overstock, abandoned inventory and excess inventory come in. For savvy buyers and sellers, these situations present a golden opportunity to snag great deals. But navigating these negotiations requires an understanding of the closeout market, the product, and the psychology of the deal.
But don't panic; here's how you can become a master negotiator in the world of closeouts, overstock products, discontinued merchandise and excess inventory. Whether you're a seasoned closeout buyer looking to expand your offerings or a seller of unwanted merchandise seeking to free up storage space and recoup costs,
Understanding the Playing Field
Before diving into negotiation strategies for buying and selling closeouts, it's crucial to grasp the landscape. Here's a breakdown of the key terms:
- Closeouts: These are products a business discontinues, often due to slow sales, seasonal changes, or brand refreshes. They are typically sold at a significant discount in an effort to clear stock from the warehouse and stop paying high warehouse fees Sometimes these can be canceled orders sitting in the warehouse collecting dust, slow selling inventory that is no longer in demand, or even abandoned merchandise left behind from an Amazon seller.
- Overstock: When a business misjudges demand and ends up with more inventory than they can sell. These products are usually in new condition but may be discounted to clear space.
- If a business had dead stock sitting in the warehouse too long, it may lose all of it's value and become completely unsalable. Once this happens the only option is to either throw away the old inventory, or donate these overstock products and unwanted merchandise for free.
- Excess Inventory: This refers to any unwanted merchandise or dead stock an importer or business, distributor, or retailer holds. Reasons can include production overruns, canceled orders, or outdated products. But in every case, there is old unwanted inventory taking up valuable warehouse space and it needs to be disposed of. Sellers who sell closeouts online often have extra inventory to get rid of. Offloading overstock products is not complicated, but it takes an experienced inventory liquidator to make large bulk inventory buyouts.
- Unwanted Merchandise: This encompasses any product a retailer deems unsalable, often due to damage, returns, or obsolescence. It can also happen when a company buys an existing warehouse filled with inventory, and they don't need or want the merchandise so they dispose of it at any cost. Also, if a business downsizes warehouses or moves out of a warehouse and leaves inventory behind, these overstock products are abandoned merchandise and is often disposed of for pennies on the dollar to clear out warehouse space.
- Abandoned Inventory: Goods left behind by a tenant vacating a storage unit or warehouse space. These can be a gamble, offering potential treasure or significant risk. When excess inventory of this nature is left behind, it may be best to have an inventory liquidator or closeout liquidators visit your warehouse to inspect the unwanted products.
- Do Your Research: Knowledge is power. Research the closeout market value of the overstock products, similar closeout deals, and the seller's reputation. This arms you with a strong baseline for negotiation. If you are looking for closeout buyers and having trouble making contacts, a simple Google search will help you. Here are some terms you can try: closeouts, closeout inventory, overstock products, unwanted merchandise, shutting down warehouse closing business, downsizing warehouses, selling obsolete inventory, keen to clear stock from warehouse, overstocked closeouts, inventory liquidators, offloading inventory.
- Volume Discounts: Negotiate bulk inventory buyout discounts, especially when dealing with large quantities of closeouts, excess merchandise or overstock. Moving a significant amount of bulk inventory benefits the seller, so leverage that to secure a better price.
- Payment Terms: Explore flexible payment options. Consider offering a larger upfront payment in exchange for a lower price. Alternatively, propose staged payments to manage your cash flow effectively. Businesses selling closeouts are often letting go of inventory at a loss so they want to be paid right away. However, obsolete inventory and overstock products may have been sitting in a warehouse for a long time and the counts are likely not accurate. If this unwanted inventory is shipped without recounting, you should have an agreement to only pay for the merchandise you receive.
- Condition and Age: Carefully assess the condition of the overstock merchandise. Damaged or outdated closeout products warrant a steeper discount. Factor in storage and potential refurbishment costs when negotiating the price.
- Walk Away Power: Don't be afraid to walk away from a deal that doesn' t meet your expectations. Sometimes, the seller is more willing to compromise when they realize you're a serious buyer who won't be pressured. There will always be another deal because there will always be warehouses filled with closeouts, excess inventory, dead stock, unwanted merchandise, discontinued products and liquidation inventory that needs to be offloaded.
- Minimum Acceptable Price (MAP): Determine the lowest price you're willing to accept for the excess inventory and liquidation stock. This prevents you from getting low balled during negotiations, and you can decide to keep the overstock liquidation if the price is too low.
- Multiple Bids: When dealing with large quantities of closeouts and abandoned inventory, consider soliciting bids from several potential closeout buyers, inventory liquidators and buyers of overstock products. This creates competition and drives the price up.
- Liquidation Auctions: Liquidation auctions can be a good option for quickly offloading large quantities of overstock inventory. Be aware that auction prices can be unpredictable, so set realistic expectations for what your unwanted inventory and overstock products are worth.
- Creative Bundling: Group similar or complementary closeout products together and offer them as a bundle at a discounted price. This can increase perceived value and encourage buyers to purchase more of your bulk inventory at one time. Inventory liquidators may respond to this, as long as they see a path to profit on the entire excess inventory.
- Transparency is Key: Be upfront about the condition and age of the overstock inventory. Providing detailed information builds trust with closeout buyers and helps them make informed decisions.
- Focus on Value: Present a clear value proposition to the other party. As a closeout buyer, highlight the potential profit margin or cost savings. As a seller of overstock products, emphasize the ease of moving large quantities and the financial incentive.
- Be Flexible: Negotiation is a dance. Be prepared to compromise on certain aspects, such as payment terms or minimum order quantities, to reach a mutually beneficial agreement.
Negotiating for Buyers
As a buyer, your goal is to secure the best possible price on closeout, overstock, or excess inventory.
Here are some key tactics to employ:
Negotiating for Sellers
As a seller aiming to clear out closeouts, overstock, or excess inventory, your primary objective is to maximize your return while minimizing storage costs. Here are some strategies to consider:
Building a Win-Win Negotiation
The best negotiations benefit both parties. Here are some additional tips to foster a collaborative environment:
Merchandise USA is an inventory liquidator in business almost 40 years. We buy closeout housewares, closeout pet products, overstock lawn and garden inventory, and excess inventory of home accessories and home goods. Overstock merchandise is too costly to sit idle in your warehouse taking up valuable warehouse space. If you are shutting down your business or moving into a smaller warehouse and offloading inventory, we can help you. If you are keen to clear stock from your warehouse contact us today. We are a reliable inventory liquidator and we can buy your entire inventory in one fell swoop. If you need to sell your excess inventory, we can help.