Liquidation.com provides a competitive environment for recouping cash on surplus goods.
It's not traditional financing, but it can be quick cash. For companies with surplus goods that need to raise working capital quickly, Liquidation.com has an answer.
The company sells overstock items, seasonal goods, customer returns, and all of the items that make up the more than $100 billion surplus goods market, says Bill Angrick, CEO of the Washington, DC-based online auction company.
"The surplus goods market can be addressed through online auctions much more efficiently than traditional liquidation sales, whether it's a retailer or an original manufacturer or someone in between in the supply chain," he states.
Why? "Online auctions are very effective in creating competition for items, and they cause buyers to bid against each other for the manufacturers' goods, which is very good from the sellers perspective," he says.
Greater competition means higher recovery rates, which Angrick says are 50 percent to 200 percent higher than those received for the same items sold through traditional liquidation channels. "Over the course of a year, particularly with larger firms, that . adds up and can be tens of millions of dollars more in cash flow," he emphasizes. The online process is also much faster than traditional liquidation processes.
How it works. The seller registers with the auction firm, provides information about its goods, and Liquidation.com can take it from there, handling logistics, fulfillment and warehousing needs. The company also reviews merchandise in detail, creating digital photos and detailed descriptions for the items and uploading those to the liquidation.com online marketplace, a feature that is particularly important for apparel, says Angrick. The company captures everything from multi-angle views, to labels, packaging and weight of the items for sale.
Also, the company handles questions from buyers, collects funds, books and tracks shipping and mediates any disputes between buyer and seller.
From another perspective, the company sells items anonymously and can also protect the seller's distribution channel by placing restrictions on the sale - tagging items for export only, for particular regions of the country, or to particular types of buyers, for example.
While many companies use Liquidation.com as a regular disposition channel for surplus goods, Angrick notes that this year the apparel business really "exploded" following the devastating President's Day weekend, when shopping virtually came to a halt as a result of terrible snowstorms on the East Coast. "A lot of retailers and distributors were saying: 'Look, I've got to get rid of last season's items, and this is the weekend I had earmarked to do that.' So we were another channel for them to move apparel items and retail merchandise."
JORDAN K. SPEER is senior editor of Apparel. She can be reached at [email protected].