Filling Your Shelves with Retail Gold (Closeouts, Overstock & Beyond)

This is where the art of buying closeouts, overstock products, excess inventory and discontinued inventory comes in. For savvy retailers, these opportunities can be a goldmine, offering a chance to fill shelves with exciting closeout products at a fraction of the cost. But navigating this environment requires a keen eye, strategic planning, and a healthy dose of risk tolerance. Buying closeouts and offloading bulk inventory isn’t for everyone, and it can take years of experience to become a reliable closeout liquidator with the experience to buy and sell liquidation stock successfully.

The Allure of Buying Closeouts and Discontinued Inventory.

There are several reasons why a retailer might find themselves with a surplus of inventory to offload:

• Miscalculations in demand forecasting: Predicting consumer behavior perfectly is a near-impossible feat. Sometimes, businesses order more than customers end up buying. This can lead to getting stuck with excess inventory and slow-selling products that take up valuable warehouse space. Importers might look to offload this excess inventory in bulk and search for inventory liquidators to buy he entire inventory from them.
• Seasonal overstock: Winter coats in July? Swimsuits in December? Seasonal shifts can leave stores with unsold items that need to be cleared. It isn’t uncommon for companies to offer closeouts on unsold seasonal inventory from the past season. The only thing to keep in mind is that if a business is keen to offload excess inventory of last seasons goods, they should be sure they won’t need to re-buy these goods at a later date for a higher price.
• Discontinued lines: Manufacturers update their closeout offerings regularly, leaving older models on the shelf. Getting rid of closeouts and excess inventory on a quarterly or annual basis allows businesses to clear out old stock from the warehouse, reduce inventory to a manageable level, and maintain a healthy level of products for sale.
• Excess stock from bankruptcies or store closures: When businesses close their doors, the remaining inventory often needs to be liquidated quickly. If a business is downsizing its warehouse or shutting down operations, it often leads to going out of business and liquidating the entire inventory. Closeout buyers and inventory liquidators are companies that come in and buy in entire inventory in one fell swoop. Offloading closeouts during an inventory liquidation is common practice when a company is shutting its doors and closing down.
• Abandoned inventory: This can happen when a manufacturer or supplier cancels an order, leaving the retailer with unwanted stock. This also happens when a tenant moves out of a warehouse and leaves all the inventory behind, or in other words this is abandoned inventory that can be sold to recoup some of the cost of unpaid rent and unpaid storage. Abandoned inventory can be offloaded to buyers of distressed inventory as these companies are accustomed to offloading excess inventory and closeouts.

This is where the magic of buying closeouts and other discounted inventory happens. Retailers can acquire these items at significantly lower prices, often 50-70% off wholesale cost. This translates to a significant boost in profit margins, especially when the deals involve popular name brand closeouts or high-demand overstock products.

The Art of the Deal: Finding the Liquidation Items and Abandoned Inventory

Not all discontinued inventory is created equal. Here's what you need to consider before diving into the world of closeouts:

• Quality: Just because it's cheap doesn't mean it should be junk. Closeouts are often available due to slow-selling products, cancelled orders, buying too much inventory and clearing stock to make room in the warehouse. These are all reasons for getting rid of closeouts that are not a reflection on the discontinued items themselves. Inspect the merchandise for damage, ensure it's functional, and verify if it aligns with your brand image.
• Demand: Will these closeout products sell in your store? Research the brand, current trends, and competitor pricing before committing. Closeouts that can be sold in one part of the country may turn into dead stock and unsold products in another region. As an example, closeouts of farm and rural products may sell well in Iowa and Nebraska, but terrible in big cities like Chicago and Los Angeles.
• Quantity: Can you handle the volume? Buying too much can leave you stuck with dead stock and excess inventory. It is important to be thoughtful and careful when companies are offloading bulk inventory and wanting to get rid of large quantities of closeouts, all at one time. If you don’t have sufficient warehouse space to store these goods it probably isn’t a good idea to commit to them.
• Storage: Do you have the space to store the inventory until it sells? This is an important thing to remember when looking to offload closeouts because having adequate space to store goods is important. Sometimes, it takes time to find the right buyers for closeouts and not everything sells quickly. Closeout buyers have large networks of overstock buyers but sometimes it isn’t enough to quickly offload the entire inventory all at one time. It can take 6 months to a year to completely get rid of the entire stock, so this is why warehouse space is so important.
• Seasonality: Is this a one-off deal, or will you be stuck with summer sandals in the dead of winter? Unless you have the ability to get rid of closeouts in other states or other countries, buying excess stock of seasonal goods can be a recipe for disaster. You will have to have enough room in your warehouse to store goods until the following season. Another option would be to have a closeout partner where you participate in the profits, but they store the overstock products and closeouts in their warehouse.

Building Your Sourcing Network

Finding these deals requires dedication and resourcefulness. Here are some key strategies:

• Liquidation Sales: Attend auctions or visit liquidation centers where businesses sell off excess inventory. These are organized liquidation sales where overstock goods are organized, offered as lots, and offloaded in bulk.
• Manufacturer Closeouts: Reach out to directly to manufacturers or distributors to see if they have any upcoming overstock sales. Every import or manufacturing company has overstock due to either over production, having bought too much inventory, or importing too much slow-selling inventory.
• Online Marketplaces: Several online platforms specialize in selling closeout merchandise. Research their reputation and terms before engaging. If you have an ecommerce company, it is likely you will have unsold products to offer as liquidation stock and discontinued items. Everything doesn’t sell through 100%, leading to having overstock products that you may be keen to clear from the warehouse.
• Networking: Talk to fellow retailers, industry professionals, and even closeout suppliers. You never know what hidden closeout opportunities and abandoned inventory might arise through connections. If you are looking for closeout buyers and companies that purchase excess inventory to help you reduce your inventory, a simple online search may be helpful. You can try terms like these: closeouts, looking to offload inventory, getting rid of closeouts, shutting down operations, downsizing and moving to smaller warehouse, keen to clear out warehouse, offloading abandoned inventory, closeout websites, closeout brokers, selling excess stock.

Turning Discounts into Dollars: Selling Strategies for Discounted Inventory

So, you've found the perfect deal. Now comes the crucial part – offloading inventory in bulk! Here's how to turn those closeouts into profit:

• Price it Right: Discontinued items and closeouts doesn't mean dirt cheap. Research similar items and set a competitive liquidation price that offers you a margin while still attracting customers. When you are looking to offload closeouts there is a fine line between getting rid of inventory to make room in the warehouse, and recovering a percentage of the original cost to pay warehouse costs and storage fees.
• Strategic Placement: Don't relegate closeout items to the list of things you will deal with later. Highlight them near high-traffic areas or combine them with full-priced overstock merchandise to create a sense of value. Getting rid of abandoned inventory is easy to do if you price it right and get the offer in front of enough closeout buyers.
• Targeted Promotions: Announce your closeout opportunities through email campaigns, social media promotions, and in-store signage to generate excitement. If you are keen to clear stock and make room in your warehouse, you have to identify your closeouts, put together promotional materials explaining the overstock opportunities you have, and get the offers in front of as many buyers of excess inventory as possible.
• Create a Treasure Hunt Experience: Present the discontinued items as a limited-time closeout opportunity, adding a sense of urgency to encourage impulse overstock purchases.

Beyond the Bargain: Managing Risks and Building a Strategy for Selling Excess Inventory and Closeouts.

Buying closeouts is not without its risks. Here are some things to keep in mind:

The Thrilling Hunt for Discontinued Inventory and Abandoned Products.

Buying closeouts, overstock, and other discontinued inventory can be a rewarding and profitable endeavor for retailers. By building a strong sourcing network, carefully negotiating deals, and implementing successful selling strategies, you can transform this undervalued overstock and unwanted items into profitable goods.

Merchandise USA is an inventory liquidator and buyer of abandoned inventory and closeouts. We have been in business almost 40 years and we are recognized as one of the largest and most reliable closeout buyers in the industry. If your business is in the process of shutting down operations, downsizing to a smaller warehouse or just looking to offload excess inventory, let us help you get rid of your inventory. We buy closeout housewares, closeout lawn and garden products, overstock inventory of pet products and liquidation stock of toys and sporting goods. If you are keen to clear stock from your 3PL warehouse we can help you dispose of any old and unwanted inventory.