Benefits of Online Inventory Liquidation

Whether B2B or B2C, most companies in the business of selling goods would have experienced slow-moving, obsolete, or excess inventory at some point.

In this article, Pollen explores the benefits of bulk inventory liquidation online.

We’ve seen the news articles, perhaps shared on social media by a friend. Coach destroys unsold inventory, Amazon throws out millions of dollars of unsold inventory, Burberry burns millions’ worth of bags, perfumes, and clothes. We’ve perhaps even read that fast fashion, that the Age of Consumerism, is partly responsible for climate change. But when demand predictions are never 100% accurate, when brands are constantly on the look out for ways to increase revenue, and when a single Tik Tok video could be all it takes to spark a new craze, how do companies manage inventory that’s no longer “sellable”?

Collage of news articles on inventory destruction

While policymakers in countries such as France enact laws preventing brands from destroying unsold goods, pushing companies towards more accurate demand planning and new ways of offloading excess inventory, inventory liquidation plays a part in helping businesses manage the inevitable (and dreaded) unsold or returned goods problem. 

“The overall return rate for online shopping across industries is 25 per cent.” – Optoro

Far from leaving items languishing in warehouses (necessitating storage costs, security costs, and the like), or dumping them in landfills / resorting to fiery destruction, liquidation provides a viable revenue option to companies while helping both the environment and consumers.

How? Take a bottle of shampoo – it’s a year to expiry, but retail sales indicate the space would be put to better use promoting something else. There’s the option of repackaging, or bundling as a seasonal promotion, of course. There’s also the possibility of aggressive marketing tactics such as discounts, ads, and influencers. But when cost is a concern and income is a ‘maybe’, sometimes brands may decide to pull the items off the shelves.

But then what do they do with all this slow-moving, obsolete, or excess inventory?

Enter: inventory liquidation companies like Pollen.

From liquidation management systems to an online liquidation marketplace that reaches thousands of buyers around the world, sustainable liquidation startups like Pollen help companies move unsold goods to where they’ll be purchased and used, quickly and cost-effectively. 

The global B2B E-Commerce market held a market value of USD 8,523.3 Billion in 2021 and is projected to reach USD 18,771.4 Billion by the year 2027. The market is anticipated to grow at a CAGR of 14.1% from 2022 to 2027.

Research And Markets, via PR Newswire
B2B ecommerce chart

Source: 2-b.io

Why sustainable liquidation, and how is it sustainable?

While demonstrating that liquidation is a viable business proposition, sustainable liquidation also carries community and environmental benefits.

Companies earn money on liquidated items, even when they’re sold at a discount to wholesalers, distributors, exporters, or retailers. Next, these buyers then sell the goods further down the supply chain at a profit, before the items end up in the hands of consumers who want or need them, but are unable or unwilling to pay full price off-the-shelf.

Take the shampoo example earlier: when the brand decides not to continue selling the item anymore, despite it having another year to expiry, the next question would be what to do with the unsold goods.

With inventory liquidation, the thousands of shampoo bottles are sold in bulk to a buyer – locally or internationally – who then sells it on to another company or direct to consumers.

Ultimately: consumers purchasing these still-usable goods receive a branded product at a significant discount. 

Meanwhile, the original company that decided to take the shampoo off the shelves received payment for the liquidated goods, while saving on warehousing or disposal costs. 

As to the question of why online inventory liquidation specifically, the numbers speak for themselves. More and more businesses, even in the B2B space, are moving towards e-commerce due to its speed, reach, cost-effectiveness, and attribution & audience targeting capabilities. If there’s one thing the COVID-19 pandemic has taught us, it’s that many things can be done remotely just as well as, if not better than, in person. Securing additional sales channels, or recycling or donation partners, is just one of them. 

Want to know more about how Pollen’s liquidation management system and liquidation marketplace can help your business?

Get in touch for your free account today!

Enjoyed this article? Share it with your friends by clicking any of the relevant buttons below, and join our mailing list for updates!