Wholesale Merchant Surplus
What is Wholesale Merchant Surplus?
Wholesale Merchant Surplus is a form of merchandise liquidation where the wholesale traders move and liquidate surplus inventory to generate quick cash. Wholesale refers to selling merchandise in bulk to a client who in turn resells them to other consumers in bulk or retail.
Surplus products in wholesale is the stock that is not meant to meet the current demand. Sometimes the surplus stock is generated deliberately or due to failed sales forecasts or in some cases due to disputes between the wholesaler and buyers. The manufacturer or the wholesaler who carries the merchant surplus has to come up with quick strategies to reduce this inventory at the earliest time.
Merchant Surplus is different from Consumer Surplus and Producer Surplus. While Producer Surplus is measured in actual currency in excess, Consumer surplus is referred as the quantitative difference between what a consumer is willing to pay for a goods and its actual price paid.
Merchant Surplus is the excess inventory held by a wholesale trader in one of the three forms – store returns or closeouts, unclaimed freight from export or seasonal overstocks. The traders have to salvage these merchandise at some point of time because carrying this excess inventory would build up costs.
In some cases the retailer refuses to buy the product lot due to wrong product, incomplete shipment, damaged products or late delivery. Such goods become unclaimed freight and it generates a whole lot of excess stock. If the goods are returned by the stores they are called store returns.
Some manufacturers and wholesalers intentionally deal with added inventory during festive seasons to accommodate fluctuating demands or sell the stock as leftovers after the season is over. Such stock is called Seasonal Overstock.
Wholesale Merchant Surplus is also referred as Closeouts, Overstock, Liquidation, Excess Inventory, Surplus, Below Wholesale, Distressed Goods, Overruns, Salvage Merchandise and Department Store Returns.
People who deal with Merchant surplus are Wholesalers, Importers, Exporters, Retailers, Distributors, Auctioneers, Brokers, Dollar Shops, Flea Market Vendors and Thrift Shops. In general Fashion Accessories, Apparels, Shoes, Handbags, Toys, Electronics, Computers, House ware, Art and Jewelry are the common goods that can be seen in the surplus market.
Why should you dispose the Wholesale Merchant Surplus
Every business and trade has its own up time and down time. The best way to manage down time in wholesale trade is to cut down on surplus inventory and pass through the worst times without incurring further losses and debts due to costly inventory maintenance.
Time is money in this market, quick turn around is possible only when you move forward all the time. The expense of maintaining excess goods which occupy dead space in your warehouse are enormous and over a period of time these slow selling inventory can be a big killer of your business too.
How to access Wholesale Merchant Surplus
Factory outlets, outlet malls and clearance shops are one of the primary source of inventory clearance channel. Factory outlets are found near or around factories which sell excess fashion goods like overcoats, women apparels, shoes and bags.
Outlet malls, which are found in most of the cities in USA, also have factory outlet shops for Burlington Coat Factory (http://www.burlingtoncoatfactory.com/), Reebok, Nike, Bed and Bath, etc. Outlet malls let you buy from more than one brand at the same location.
There are outlet mall chains in USA that operate similar malls in many metropolitan areas like Premium Outlets (http://www.premiumoutlets.com/) and Tanger Outlets
(http://www.tangeroutlet.com/). You can also buy niche items like camping goods from specific brands like Coleman from their own factory outlets located around the USA (http://www.coleman.com/factoryoutlets/).
There are other dealers like Liquidity Services Inc, (www.liquidation.com) which provides business clients and buying traders the world’s most transparent, innovative, and effective online marketplace and integrated service for wholesale merchant surplus assets.
Surplus auctions is a way to access military, governmental agency and other institutional excess or obsolete goods. Mostly such auctions are held only by invitation and the highest bidder gets rights to the excess items like furniture, computers, vehicles, etc.
If you are dealing with Merchant surplus, remember that unless you hit upon a very novel product, you will be dealing with bulk goods on lower prices than the regular wholesale price. Price estimation, quick turnaround for reselling, good contacts and ability to move large quantities quickly will help you realize profit in this area.
Here are some other Wholesale Sourcing sites that I have found for you to browse. Thanks for visiting Sourcing-3.com.