Why Is It Getting Harder To Run A Closeout Business?
Are you curious about how to run a closeout business? According to the most recent figures released by the Small Business Administration (SBA) in 2020, there are over 3.1 million small businesses in the United States. Closeout brokers and other businesses that specialize in selling excess stock help companies get rid of closeouts and too much inventory. But as you might suspect, running a small business isn't for the faint of heart. It requires extreme focus, energy and the flexibility to adapt. The trick, some might say, is to go in with open eyes. Check out these pointers to help you focus on what can make a small business thrive. Closeout distributors and other wholesale import companies in particular are tough to manage.
Running a successful closeout business starts with your definition of "success."Not every business has international aspirations or global growth in mind. This is why a solid business plan is essential to help you chart a path for the kind of growth and success you envision. If it is your goal to have a local discount store or a wholesale company selling closeouts you can make a living on a regional or even national basis. If your goal is to build a multi-national closeout company selling excess stock around the world, it may be more challenging to meet this definition of success. For companies that have too much inventory and have accumulated dead stock that isn’t selling, a simple Google search can help them find buyers for their inventory. Search terms might include: closeout brokers, companies that buy dead inventory, how to get rid of excess inventory, and overstock inventory buyers.
From gaining more control of your time to being in charge of things, owning a closeout business comes with a set of incredible benefits. However, it doesn’t come without a fair share of challenges either. Despite common misconceptions like, “small businesses are easier to run since you choose your working hours and you’re the boss”, many entrepreneurs run into challenges along the way. For example, buying and selling closeouts may seem like an easy task, but this is far from the truth. Challenges like accumulating too much inventory and paying excessive Amazon storage fees are common. Many businesses have found that it is too expensive and costly to warehouse dead stock in 3PL warehouses when instead, they can liquidate the entire warehouse in one fell swoop with the help of closeout brokers. These include challenges that feel insurmountable and others that could bring the business to its knees in a flash if not carefully navigated. This is the reason business owners decide to get rid of all their inventory and liquidate entire warehouses. The trouble of sourcing closeouts and overstock inventory can sometimes be overwhelming.
Well, what we are trying to say is that being a small business owner is nothing close to a bed of roses. It’s an arduous undertaking, not forgetting the aspect of risk, competition, and scarcity of resources. When a business has too much inventory on hand it calls on closeout brokers or excess inventory buyers to help get rid of the merchandise. Sometimes the closeout process is fast and other times liquidating all the inventory can take a great deal of effort. Let’s decipher why small businesses are hard to run and how you can make it easier. If you talk to some of the most successful closeout companies (the frank ones), they will tell you that success doesn’t come served on a silver platter. Some school of thought believes that if running your business feels difficult, there are some things you’re not doing right. Well, there is so much truth in this! You may have too much inventory on hand, you may want to liquidate some products to raise cash for new merchandise, you may simply have decided to get rid of everything and liquidate the warehouse while you have the time and energy for it.
But again, running a small closeout business can be difficult because, for starters, you are threatened by the fear of failure. After choosing the right model for distributing excess merchandise you also need to continually research the market, figure out the best marketing strategies, and strive to ensure your overstock operations are streamlined. Furthermore, resources can be scarce, especially if the closeout business is still young. As a small business owner, you could be the one handling HR issues like paying your employees, dealing with investors, and keeping track of bookkeeping issues. If you’re an independent contractor, figuring out what to pay yourself is a common hurdle, plus you have to keep track of the deductions and taxes required from you. Luckily, you can always use a reliable paystub jmaker when dealing with salaries, taxes, and deductions – thanks to features like auto calculations. It is also a handy tool when you need to have proof of income/employment because a paystub provides more information than a bank statement can. Banks are often closely involved with the closeout distributors business and sales cycles. If sales slow down too much, you can bet they will call the loan for old inventory that isn't selling, and they will even force a liquidation of the entire inventory to pay back the borrowed money. You simply have a lot on your shoulders before the business can stabilize, grow, and start expanding. Since most of your mind, focus, and efforts are all aiming at success, you may not always be in the best spot to make critical decisions.
Truthfully, working for yourself is a fulfilling experience. It might take some time, patience, effort, but the rewards are always worth the while. Overstock distributors work with bankruptcies and business liquidations when companies get stuck with too much inventory. They can help Amazon sellers shut down FBA sites or they can work with businesses wanting to sell off old inventory and excess overstock products that are just gathering dust in the warehouse. Nonetheless, being an entrepreneur requires great dedication, consistency, and boldness. It takes understanding that failure is a possible occurrence amid the various challenges that face small businesses globally. When companies fail they may have to liquidate inventory to cover debt. Dead inventory sitting in the warehouse is costly and can adversly affect the bottom line. It is always better to sell old inventory, get rid of excess stock, and clean the warehouse of old merchandise. This should encourage you, even more, to do things right every time. When working for yourself, here are some take-home tips you should find helpful.
Time is like a gold mine when it comes to business. A few seconds or minutes wasted could cost your business millions of money. Luckily, there are many ways to save time and maximize productivity while improving efficiency these days. Spending too much time trying to sell old inventory is not profitable. Also, letting dead stock take up valuable warehouse space that could be used for new products is costly.
Plan your time well using schedules and diaries, utilize time-management technology, and always perform regular assessments. These will go a long way in freeing time, so you have extra hours to focus on what matters most for your business, as well as some for your social errands. If you are looking for buyers to purchase dead stock, you can do a simple Google search to find closeout buyers. Here are some terms that will send you in the right direction: sell surplus inventory, companies that buy closeouts, where to get rid of dead stock, inventory liquidators and liquidate 3PL warehouse, closeouts, closeout brokers.
Finally, cash flow is a critical aspect of small business ownership. The last thing you want is to lack enough funds to pay your recurrent bills, workers, or suppliers, just when your business is showing some real signs of growth. Also, if you plan to buy abandoned inventory and excess inventory, you will need to have large amounts of cash reserves on hand at all times. You will be an opportunity buyer so when a business is forced to liquidate inventory or close down a business you will be in a position to act quickly. This brings in the need to regularly monitor your cash flow and stay on top of your due invoices.
Utilize cost-cutting measures in various departments, including operations, procurement, and production, and even HR. You could also lease equipment rather than buying. If you can, hire an experienced accountant to take care of bookkeeping and accounting. The best approach will largely depend on your specific business needs. These are more ways that allow you to retain cash reserves for buying excess inventory and abandoned goods from 3PL warehouses, closeout distributors and liquidators.
If you thought that running a small business is a walk in the park, you have more than a few reasons to think again. The truth is, it takes quite an amount of effort and perseverance to see a new venture through to success. The few pointers above should help make it easier and much more fulfilling for you as an entrepreneur. Closeout distributors often work with banks, lending institutions and closeout brokers to find the most profitable deals that can be sold to discount and extreme value retailers. These retail stores specialize in selling closeouts, overstock inventory and goods that have been abandoned in the warehouse or left behind by businesses that have shut down. It is too expensive to just let this merchandise sit in some warehouse collecting dust, so it is better to get rid of it for whatever they can, even if it means pennies on the dollar. Starting your own business is one of the most exciting choices anyone can make. Millions have done so successfully and found it an exhilarating and rewarding challenge. However, starting a business also has its downsides and its risks.
You need to seriously consider whether starting your own business is right for you, honestly appraising your strengths and weaknesses. Do you have the skills and determination it will require? Do you have the full support of your family and friends? Can you afford the financial uncertainty and risk of possibly going out of business and having to liquidate everything for less than you paid? Of course, you don't expect for this to happen but in a worst case scenario if you have to shut down your 3PL warehouse and get out of the business can you afford to take the loss? Not all merchandise sells as we expect and there are often times where the only option is to liquidate everything and get rid of the inventory for any money.
It’s not easy to delegate tasks. Most entrepreneurs micromanage their closeout businesses. Besides, the company is your baby, and you probably believe that no one can do better than you. However, as time goes on and your business expands, you notice that you need help. You cannot be the closeout buyer, salesperson, warehouse man, bill collector and marketing manager all in one. You will need salespeople to go our and sell your inventory. You will need buyers who know how to find deals on abandoned inventory left in warehouses and closeouts or overstock inventory. They have to have an understanding of where to look for buyers for discontinued inventory and products that have stopped selling. You will need warehouse people who understand they will often need to repack and recount. Closeouts rarely come in clean and perfect original factory cases. Many times they are repacks or even returns. Closeouts are not as clean as regular imports and require special knowledge in order to warehouse them. When a business gets rid of its excess inventory, sometimes they don't pack it perfectly and it requires extra attention. It would be best if you learn to delegate for your business to operate smoothly. Outsourcing can save money and focus on what you are best at and other essential aspects of running the company. Some aspects that you might benefit from outsourcing include web design and development, customer support, and warehousing. If you ship everything to a 3PL warehouse they will warehouse your abandoned inventory and closeouts, they will do any Amazon FBA shipments, and they will deal with fixing cartons and pallets filled with overstock merchandise that isn't in the original factory cartons.
Merchandise USA has been in the liquidation business for 38 years. We specialize in buying and selling closeouts, warehouse abandoned inventory, overstock inventory and discontinued products. We work with businesses shutting down 3PL warehouses as well as companies liquidating their entire inventory. If you are looking for how to get rid of too much inventory we can help you understand the closeout
