While US shoppers search the stores for post-Thanksgiving bargains, small businesses that buy and sell excess stock are being offered even more extreme deals this winter, as leading retailers struggle to shrink their inventories.

Liquidation.com, a web-site that stages auctions of excess products, or those that have been returned, says it has had an increase of “about 800 per cent” in the number of auctions currently on its site compared to last year.

EDITOR’S CHOICE
US downturn - Nov-27The site features an eclectic range of bargains – from high-definition Samsung televisions (for $276 each), to an Yves Saint Laurent umbrella (for $6.25). Bill Angrick, chief executive officer of Liquidity Services, the site’s owner, says he has seen a flood of new business since September, when falling consumer demand took retailers by surprise.

“There’s an insatiable demand for bargain or discounted merchandise on the buying side, and there is a tremendous increase in volume coming out of the supply chain from retailers and manufacturers,” he says.

Leading stores have “made the decision that it is prudent to cut the volumes ahead of what looks like a once in 20-year decline in spending patterns”.

His company, which turns over about $350m a year (€272m, £227m), is just a small part of a returns and resales business valued in billions of dollars.

Liquidation.com’s recent auctions have included a lot of 49 women’s suits from the shelves of Macy’s and Bloomingdale’s department stores that sold for $750 – against the combined recommended retail price of more than $11,000. Mr Angrick says that most of the buyers on the site are small businesses, such as so-called mom and pop outlet stores and regional chains, while some of the inventory is acquired by Ebay “power sellers” who sell direct to online shoppers.

Joel Holtzman, chief executive of Excess Technologies, a smaller Atlanta-based liquidator, says his company is also facing a surge in offers, which include 324 women’s evening dresses reduced from $138,000 to $9,000.

“It’s gone from 70 per cent of my calls being from sellers, and 30 per cent from buyers, to perhaps 95 per cent from sellers and 5 per cent from buyers,” he says.

Large shipments of excess fashion inventory are the stock-in-trade of several national bargain retailers, including Ross Stores, Big Lots and TJX, owner of TJ Maxx.

The chains’ sales outperformed most of their full-price competitors in October, joining a select group that includes Wal-Mart, the US supermarket chain, and dollar stores.

Mr Angrick argues that, in spite of the slowdown, inventory still eventually sells even if it ends up exported to the developing world.

“There is a trading down at every rung on the ladder in this environment...that cascading effect means that, if you can bring [a] product to market that is below wholesale prices, you are very attractive [to consumers],” he says.

“It is human nature. You want to go out and put something in your bag and take it home...and people will just spend less for that item.”


See Original Article

Call now for help with corporate debts.

Call us on: 0800 071 1616

Email us on: info@debtsgone.co.uk

Website: www.debtsgone.co.uk