Enter ‘the reverse supply chain’ — where Amazon returns are sold and reborn

Liquidity Services is capitalizing on the influx of Amazon returns, where it buys pallets of rejected items for a fraction of the valued price and sells them to side-hustlers.

January 24, 2019

Amazon’s product-sorting and ranking algorithms are the best in the business — after all, the company sells a wider variety of goods than an industrial-sized bag of Otter Pops. But once a product is returned, all organization goes out the window. 

Once the items wriggle free of the database, they’re randomly cobbled into mystery boxes full of other unwanted goods — cuz who wants to waste time sorting the rejects?

Per The Atlantic, it turns out there’s a whole market of hustlers looking to capitalize on Amazon’s slop… which is where Liquidation.com comes in.

Going where lots of returns have gone before

Founded in ’99, Liquidity Services (branded as Liquidation.com) is a marketplace that connects sellers to its list of nearly 3.4m registered buyers.

The company calls dealing with returns “the reverse supply chain” — a side of the retail biz that has only grown as online shopping increases (in 2016 an estimated 25-30% of online purchases were returned). 

In the past fiscal year, Liquidity Services bought $33m of leftover Amazon inventory (which it then sells for maybe 5% of the supposed retail value) — and then it sold $626m worth of shtuff.

A side-hustle is born

Once people buy Amazon’s mystery boxes from Liquidity Services, they can sort the items and then sell them for larger profit.

Now that liquidation is taking off, some people are making side cash while others are making it a profession: But don’t be a liqui-fool, in the world of resale, there’s always more dirt than gold.

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