I am sure you have seen countless offers
for closeout merchandise from both retailers
and wholesalers. You can find closeout sales
on Amazon, eBay, at Macy's, at your local
department stores, at wholesale warehouses,
and by literally thousands of retail
and online sellers.
While it's become really popular for retailers,
as well as for wholesalers, to label every deal
a "closeout", finding a closeout that you
can actually make money with can be challenging.
Remember, a big discount on brand name
merchandise only benefits a seller if
her customers can't easily get the same deal.
If Target is having a closeout sale
on boys jeans, and the price per pair
is only $5 each, that price is only
attractive if Target has a limited supply
available, or if your customers do not
have a Target to shop at.
But if Target is having a national sale,
and those jeans are available
to everyone, then you
are going to have a challenging time
selling the boys denim at a profit.
The same is true with a
A closeout deal needs to be unique
and scarce in order for it to be
potentially profitable for a retailer.
It doesn't have to be necessarily unique
or scarce in the city that the wholesaler
is located in, but it should be in the market
in which the retailer does business.
For example, wholesaler in Manhattan can offer
a boutique in Nigeria a deal
that is an amazing closeout offer,
provided that the products being
offered are not available at the
same price in Lagos or Abuja.
For example, let's say you visit a fashion showroom
in the NYC Fashion District.
The salesperson offers you a closeout deal
on a selection of Coach handbags.
You are excited since the Coach handbags are being
offered to you at 50% below the regular retail price.
But are you actually getting a good deal or not?
If there are many shops selling the Coach handbags for
50% below retail, then you are actually paying the
going rate for them.
But on the other hand, if most sellers are selling them
at only a 10-20% discount, then you are definitely
getting a good deal. (Assuming that you are comparing the
Or let's say you visit a wholesale supplier in Brooklyn
and they offer you a closeout deal on Calvin Klein dresses.
The dresses are only $19.99 each, which is about 80% below
the retail price.
If your customers are accustomed to paying $50 for these dresses,
then in this case you are getting a great deal since you
can resell the Calvin Klein dresses for more than you
are paying for them.
It's very important to do your research on any wholesale products
that you are considering buying.
You need to know what the actual selling price of the item is in the
market that you will be retailing it in, while factoring
where and how else your customers can purchase that item.
If your customers can easily shop for it online at a lower
price you need to know that.
You also want to know if the product is in demand.
You can purchase a closeout pair of BCBG shoes at
90% below retail, but if your customers do not like
those BCBG shoes, then you essentially
have not gotten a deal that makes sense for you.
Having said this, you can sometimes encourage shoppers
to try out a new brand name or designer label item
by giving them a fantastic price.
With the example of the BCBG footwear, if you offer them
to your shoppers at 80% below retail you might attract their
Factor in also any associated costs that will increase the
actual wholesale cost of the item, such as shipping
If you are an Amazon or eBay seller there are many apps
that you can download that will tell you how much
you can resell the items for on Amazon or eBay,
and what your actual net result will be after any
One important point is that if you want to negotiate
in the most effective way possible then you
need to have a compelling reason for why
a closeout seller should lower his price. If you
have done your research, and you share it with
the vendor, then you will have a better chance
of getting a lower closeout price than if you
just asked for it.
Remember, although you can get fantastic deals
from wholesalers, you can also purchase closeout
merchandise directly from brands, designers, and
even from retailers.
I have seen some really good clearance sales at
department stores such as Macy's and Sears,
that effectively meant that the
merchandise was being sold at a true closeout
price that could enable a seller to potentially
If you are going to purchase clothing, shoes, or
any other item, for resale from department stores,
you will want to look for any available coupons
in your local newspaper.
I have seen many Macy's coupons in the New York Post
and Daily News that can give you an extra
20% discount on your purchases.
If you are buying an Tahari suit at a 60% discount,
and use a coupon that gives you an additional
20% discount, then you have effectively
saved 68% off the original retail ticket.
There are also many sites online where you
can find coupons for retailers that
you are likely already shopping at.
If this sounds like too much work,
and I do understand that it can
take a great deal of research, time,
and effort, you can always visit
clothing warehouses like my
Brooklyn business, Closeout Explosion.
Many retailers, especially flea market
vendors, like purchasing products by the
A wholesale pallet can provide them with
a large assortment of overstock inventory at
below wholesale prices, but the
challenge is the uncertainty of the
If the price of the pallet is low enough
to offset the risk it might be worthwhile,
or a vendor can take his or her time
visiting warehouses and making their