Where to Find Merchandise to Resell

When you put together your business plan, you indicated the type of business that you wanted to conduct. If you planned your eBay business around merchandise that you currently own or create yourself, you can skip this section. But if you planned your business around the resale of new or used merchandise, you have to find a source for the items you want to sell.

Sourcing your inventory is one of the toughest tasks for high-volume eBay sellers. While the average eBay seller typically finds items in his or her own home or in garage sales, high-volume sellers have to find a constant supply of new merchandise. In essence, high-volume sellers are resellers because they purchase merchandise from wholesalers or other sources and then resell that merchandise to their customers via eBay auctions.

Where can an individual find a source for merchandise to resell on eBay? There are several options, all of which involve buying items in bulk. That means laying down the cash up front to buy large quantities of items, and then making your money back later, one sale at a time. This is one reason why a budding eBay business needs a source of funding; purchasing your starting inventory can tie up a lot of cash.

Note

Learn more about obtaining funding for your business in Chapter 4, "Evaluating and Arranging Funding."

Whatever type of merchandise you choose to resell, you should always make sure you're buying from a reputable supplier. That means passing up those companies that have a website but no published phone number, or a post office box but no physical address. Even better, research the business on the Better Business Bureau website (www.bbb.org), or check the company's ratings at Dun & Bradstreet Small Business Solutions (smallbusiness.dnb.com) or Hoover's (www.hoovers.com). You can also pick up the phone and give the company a call; you can tell a lot from a simple conversation.

Another strategy is to go direct to the manufacturer for information (and, sometimes, products). ThomasNet (www.thomasnet.com), the only home of the venerable Thomas Register, is the definitive directory for finding products and companies in the U.S.

Read on to learn about the many different sources of resalable merchandise.

Wholesale Distributors

The way traditional retailers do business is to purchase merchandise from a wholesale distributor. The distributor purchases merchandise direct from the manufacturer, who in many cases doesn't deal directly with retailers. The distributor, then, is a middleman who provides a variety of services to the retailer, not the least of which is warehousing the large quantities received from the manufacturer.

If you want to be an "official" reseller of many types of products, you'll have to deal with the products' authorized distributors. There are thousands of wholesalers out there, most specializing in specific types of merchandise. Most wholesalers are set up to sell in quantity to legitimate retailers, but many also handle smaller orders and smaller buyers, making them ideal for eBay sellers. Many of these distributors operate over the Internet, which makes the process even easier for you.

How do you locate a wholesaler? One way is to attend an industry trade show or conference. Most distributors attend or exhibit at these shows; you can also find out about new products and (sometimes) get special tradeshow pricing. You can also contact the manufacturer directly; most will be glad to direct you to the distributor in your region.

If you live in a major metropolitan area, it may have a trade or merchandising mart where multiple wholesalers may be found. For example, Atlanta's AmericasMart is home to hundreds of specialized distributors, as is Chicago's Merchandise Mart. Check with your local chamber of commerce to see what's available in your area.

Note

You can search for trade shows of interest at the Tradeshow Week magazine website (www.tradeshowweek.com).

In addition, you shouldn't be afraid to ask other retailers (online or local) for the names of wholesalers they buy from. Most merchants are quite helpful, as long as they don't perceive you as a direct competitor.

And here's one advantage of dealing with an official wholesaler: If you do enough business (and your credit rating is strong enough), you may be able to establish credit terms for your purchases. Instead of paying cash on the barrelhead, you may not have to pay until 15, 30, or even 60 days after you receive your merchandise. Check with your wholesaler to see what terms are offered.

Note

Learn more about buying and selling merchandise direct from the manufacturer in Chapter 11, "The Retailer."

You'll have to conduct your own search for a wholesaler that specializes in the particular type of merchandise you're interested in selling. I'll list a few sites that function as directories or search services of wholesale distributors, but it's hard to beat a targeted Google search. Just make sure you put the words "wholesale" or "distributor" in your query.

Wholesale411

Wholesale411 (www.wholesale411.com) is one of the best search directories for wholesale and closeout merchandise, period. Wholesalers and liquidators list their merchandise and services on the Wholesale411 site, which then organizes the available merchandise into a variety of product categories, as shown in Figure 14.1. You can also search the site for suppliers of specific types of merchandise.

Figure 14.1. Browse through the categories or search for specific types of wholesalers at Wholesale411.

goWholesale

The goWholesale site (www.gowholesale.com) helps you find wholesale suppliers of all manner of merchandise, from custom T-shirts to computer parts. You can browse or search for suppliers, and the site contains a lot of links to suppliers who specialize in selling to eBay businesses. (Interestingly, goWholesale provides the search engine behind the Wholesale411 site.)

Buylink

Another place to find vendors of different products is the Buylink site (www.buylink.com). You have to register as a retailer to search the Buylink marketplace (registration is free), but then you can search for specific products or vendors.

Top Wholesale Suppliers.com

When you're looking for wholesalers, you should also check out Top Wholesaler Suppliers.com (www.topwholesalesuppliers.com). This is a free online wholesalers directory, organized by product category.

Wholesale Central

Wholesale Central (www.wholesalecentral.com) is another leading directory of merchandise wholesalers. You can browse for vendors by category or search for vendors of specific products.

Caution

With so many legitimate wholesaler directories on the web, you want to avoid those scam artists that offer to sell you a "guaranteed" directory (in a book or on CD) of wholesalers or dropshippers. More often than not, you'll pay your money and receive a several-years-old listing of sitesnot all of them reputable, and many of whom have since gone out of business. You shouldn't have to pay for information that's available for free on the Web in a much more current form.

WholesaleQuest

Yet another wholesale marketplaces for eBay resellers is WholesaleQuest (www.wholesalequest.com). You can browse through suppliers by product category or search for suppliers of specific types of merchandise.

Merchandise Liquidators

Liquidators are companies that purchase surplus items from other businesses, in bulk. These items might be closeouts, factory seconds, customer returns, or overstocked itemsproducts the manufacturer made too many of and needs to get rid of. Liquidators help manufacturers and retailers dispose of this unwanted merchandise to the secondary market.

Note

Learn more about buying and selling closeout merchandise in Chapter 10, "The Bulk Reseller."

Just as liquidators purchase their inventory in bulk, you also buy from them in bulk. That means buying 10 or 20 or 100 units of a particular item. You get a good price for buying in quantity, of course, which is part of the appeal. You also have to manage that large inventoryand inventory storage can be both a lot of work and somewhat costly, especially if you don't have a large (and currently empty) garage or basement.

When you buy surplus merchandise, check the warranty terms. Unlike the new merchandise you purchase from traditional wholesalers, most liquidators sell their goods "as is." That means if it's bad, you have to eat itunless you also sell your goods with no warranty to your eBay customers.

Know, however, that just because you can buy bulk merchandise cheap doesn't make it a good deal. Remember, there's probably a reason why an item is being liquidated. It may be last year's model, it may be factory seconds, it may be used or returned, or it may just be something that no one wanted to buy. If it didn't sell well originally, there's no guarantee that it will sell well (at a lower price, of course) in an eBay auction.

That said, here's a short list of liquidators that can supply you with merchandise for your eBay auctions.

Liquidation.com

Liquidation.com (www.liquidation.com) is one of the largest and most reputable online liquidation services. The Liquidation.com website, shown in Figure 14.2, offers a steady stream of surplus, closeout, and returned merchandise in a variety of categories, from clothing and consumer electronics to construction supplies and vehicles.

Figure 14.2. Buy surplus items in bulk at Liquidation.com.

What kind of merchandise are we talking about? How about a lot of 11,000 socks, or 45 radar detectors, or 100 20GB hard drives, or 2,000 belly ringsjust for a start. Pricing is pretty good, if you can take the quantities. For example, those hard drives went for just $14.25 apiece at a total lot price of $1,425. Assuming you can resell them on eBay for $30 or more, that's a pretty good deal. The key is to pick an item that you know you can move in bulk over a period of weeks or months.

Note that Liquidation.com actually serves as a middleman between sellers (the original manufacturer or retailer) and buyers (you). Goods are sold in an online auction format, so you'll find yourself bidding on items just as you would in an eBay auction. All auctions start at $100, with no reserve. You can even pay for your merchandise with PayPal.

#1 Accessory.com

The #1 Accesory.com site (www.1accessory.com) specializes in wholesale jewelry and fashion accessories. You can find both individual items and larger lots.

Note

Unlike eBay auctions, Liquidation. com doesn't allow sniping. If there's a last-minute bid, the auction is extended by three minutes to enable all interested bidders to respond.

America's Best Closeouts

What you find at America's Best Closeouts (www.abcloseouts.com) is bulk quantities of used, second-hand, and recycled clothing. They're an especially good source of jeans in large lots.

American Merchandise Liquidators

American Merchandise Liquidators (www.amlinc.com) handles closeouts, overstocks, customer returns, and salvaged merchandise in a variety of categories, including clothing, furniture, toys, tools, and other general merchandise.

AmeriSurplus

AmeriSurplus (www.amerisurplus.com) sells salvage merchandise by the pallet from a warehouse in South Carolina. Products offered include automotive supplies, groceries, small appliances and electronics, sporting goods, and toys.

Apparel Overstock.com

Apparel Overstock.com (www.appareloverstock.com) specializes in wholesale brand name and designer clothing for men, women, and children. You can find quantities of similar merchandise from the same manufacturer, or mixed lots containing a variety of sizes, colors, and styles.

Bid4Assets

Bid4Assets (www.bid4assets.com) is an online auction site offering merchandise obtained from bankruptcies, private companies, and the government. This site offers primarily high-ticket items, including artwork, computer equipment, jewelry, vehicles, and even real estate. The items offered are typically single quantity, not bulk.

Bookliquidator.com

Bookliquidator.com (www.bookliquidator.com) is an excellent source for used and vintage books. The site also offers dropshipping services for its customers.

eBay Merchandise.com

eBay Merchandise (www.ebaymerchandise.com), while not affiliated in any way with the eBay site, offers closeouts, overstocks, returned merchandise, and similar items for sale to eBay sellers. Items can be purchased by the piece, the pallet, the lot, or the truckload; products in a variety of categories are available, from automotive goods to toys.

Luxury Brands

Luxury Brands (www.luxurybrandsllc.com) offers higher-end surplus merchandise than you find at other sites. Items include luxury branded European clothing, accessories, and gift items. Even though this is surplus merchandise, you might recognize some of the brandsincluding Giorgio Armani, Ralph Lauren Polo, Givenchy, Gucci, and Burberry. The company purchases large mixed parcels of European merchandise, typically end-of-season merchandise, and then imports it for sale in the U.S. You can purchase products in lots of 10, 25, 50, 100, and so on.

Overstock.com

Overstock.com (www.overstock.com) offers surplus merchandise from a variety of manufacturers. The company sells single quantities of closeout merchandise through its normal website but offers larger discounts (and discounted shipping costs) when you buy multiple quantities through the Club O section of its site.

Salvage Closeouts

Salvage Closeouts (www.salvagecloseouts.com) offers liquidated merchandise and department store closeouts in a wide variety of categories, from Apparel and Appliances to Tools and Toys. It also offers a variety of pallet and truck-load specials, and has a special eBay Specials category.

Surplus.net

Surplus.net (www.surplus.net) aggregates merchandise from hundreds of different liquidators. It's also one of the portal sites for the Internet Marketing Association of Surplus Dealers (IMASD), an organization of closeout suppliers.

TDW Closeouts

TDW Closeouts (www.tdwcloseouts.com) is another distributor of department store returns and closeout merchandise. It offers liquidated, salvage, overstock, and surplus items in a variety of categories, from Apparel to Toys.

Other Sources of Merchandise

If you're less interested in bulk and more interested in variety, there are a few other sources that can supply you with merchandise for your eBay auctions. I'll list some of the more popular ones next.

Note

Learn more about buying and selling used merchandise from garage sales and flea markets in Chapter 8, "The Second-Hand Reseller."

Garage Sales

Many eBay sellers got their start by reselling merchandise they picked up at local garage/yard/tag/rummage sales. While this can certainly be a source of merchandise, it may not be a consistently reliable source for all high-volume sellers, for a number of reasons. First, the merchandise you buy isn't limited to a specific category, and it's tough to deal with such a large variety of items. Second, it's not a guaranteed supply; you might stumble across a great deal one week but then go dry the next. Finally, this source looks to be getting tapped in some areas, as more people choose to sell their old stuff on eBay rather than putting it out in their front yards. Take a gander, but don't be disappointed if this source doesn't pan out.

Flea Markets

Flea markets offer similar merchandise to what you find in garage sales, although you can sometimes find surplus items in bulk. If you keep your eyes peeled, you might find the occasional bargain that can supply your eBay auctions for an extended period of time.

Estate Sales/Auctions

Not to be insensitive, but dead people provide some of the best deals you can find. Estate sales and auctions are the equivalent of raiding somebody else's garage or attic for old stuff to sell. Check out the weekly estate sales and auctions in your area, be prepared to buy in quantity, and see what turns up.

Traditional Auctions

Real-world auctions (not the eBay kind) remain a good source of inventory for many eBay sellers. Many auctions feature large lots or bulk quantities, which are perfect for ongoing eBay sales. Make sure you inspect the merchandise before the auction, and don't get caught in a bidding frenzy. Set your maximum price beforehand, and don't exceed it. The Internet Auction List Auction

Calendar keeps a list of ongoing auction events by date and location. Check out the website at www.internetauctionlist.com.

Vintage and Used Retailers

You can often pick up some decent collectible merchandise at your local "vintage" or used merchandise retaileralthough you may have to haggle a little to get down to a decent price. The big drawback is that you're typically buying onesies and twosies; this isn't a good source for large lots.

Thrift Stores

Think Goodwill, Salvation Army, and similar stores here. You can sometimes find decent merchandise at low costand help out a nonprofit organization, to boot. This approach has the same drawback as buying from a vintage retailer, however; large lots are rare. And many eBay sellers report that the major thrift stores have raised their pries to more closely match the going rate on eBay, so finding a good deal could become more difficult over time.

Pawn Shops

You can't overlook the traditional pawn shop. There are always interesting items to be found, often at a bargain price. Ask about merchandise that's been sitting on their shelves for awhile, and then offer a bulk buyout or perhaps even a consignment deal.

Dollar Stores

Dollar stores or "big lot" retailers are surprisingly good sources of eBay-ready merchandise. Most of these retailers carry overruns and closeouts at attractive prices. You can often pick up items here quite cheapand enough of them to feed your auction activity for a while. Some of the larger dollar-store chains include 99¢ Only (www.99only.com) and Family Dollar Stores (www.familydollar.com). The Big Lots chain even has a special website for wholesale buyers, located at www.biglotswholesale.com; it's worth checking out.

Warehouse Clubs

You'd be surprised what deals you can find at your local Sam's Club (www.samsclub.com) or Costco (www.costco.com). Buy something cheap enough here, and it's not too hard to resell that item at a decent markup on eBay. (Plus, Sam's Club holds its own online auctions that sometimes offer good bargains for the savvy eBay seller.) Just remember that the clubs' product mix is continually changing, so you'll need to visit often to find the latest deals.

Closeout Sales

You don't have to shop at a cheap retailer to find a good deal. Many mainline merchants offer terrific deals at the end of a season or when it's time to get in next year's merchandise. If you can get enough good stuff at a closeout price, you have a good starting inventory for your eBay sales.

Going-Out-of-Business Sales

Even better, look for a merchant flying the white flag of surrender. When a retailer is going out of business and says "everything must go," that means bargains are yours to be hadand don't be afraid to make a lower-priced deal, if you can.

Ándale Suppliers

If you're not sure where to find specific types of merchandise, you're in luck. Ándale Suppliers (www.andale.com) is a free service that helps you find suppliers of various types of merchandise for resale. It does a good job of matching resellers with suppliers, by keeping a big database of both.

When you sign up for Ándale Suppliers (it's free, remember), you start by filling out a buyer profile. Select the categories of merchandise in which you're interested, and Ándale Suppliers will automatically match you with suppliers who match your criteria. You can choose to receive your leads by email or on the Ándale site itself. Each lead listing includes the supplier's location and eBay feedback rating, so you can judge its trustworthiness.

Note

You can find Ándale Suppliers on the Ándale site under the Research Tools tab.

eBay

This leads us to the final place to look for items to sell on eBayeBay itself! Yes, it's possible to make money buying something on eBay and then turning around and selling it to someone else on eBay at a later date. The key is timing. Remember, you have to buy low and sell high, which means getting in at the start of a trend. Being successful at this approach is possiblealthough it takes a lot of hard work, and not a little skill.

One way to find goods for resale is to use eBay's search feature. Make sure you include the words "case," "closeout," "lot," or "surplus" in your query.

Another option is to go directly to eBay's Wholesale Lots category (pages.ebay.com/catindex/catwholesale.html). As you can see in Figure 14.3, this page lists eBay auctions of surplus merchandise in almost all of eBay's major categories. Just click through to bid on merchandise ideally suited for resale.

Figure 14.3. Sourcing surplus merchandise on eBay's Wholesale Lots page.