September 12, 2019 by John Louis
For any small business owner, the mere thought of liquidation seems to be grotesque and dreadful. When we first hear the word liquidation, the first scene that comes to our mind is a business going bankrupt, hefty debt figures, and stores closing down. But this is just the type that media has filled in our minds. Liquidating products is a common process that most businesses undergo on a regular basis. Whenever they have an overstock, obsolete inventory, or returned goods, they liquidate them to get some usable cash, and this is where wholesale liquidation companiesprove to be helpful.
Types of liquidation
Basically, there are two major types of liquidation, one is voluntary and the other one is compulsory.
Compulsory liquidation: When we think about bankruptcy and stores closing down, it is the liquidation that businesses have to do without any choice. Coming as a compulsory liquidation, this is the last resort that is left to a business after bankruptcy or business failure. During this type of liquidation, they are forced to sell off each and every item of their business until the amount adds up to their debt amount. When a business is liquidating on compulsion, it is mostly closing its doors for the time being.
Voluntary liquidation: On the other hand, voluntary liquidation is a kind of strategy that businesses use these days. In fact, all the top players of the industry liquidate their inventory almost every day. This allows them to get rid of their old products and make way for the new products to feature in their stores.
Whether you are a retailer, manufacturer or distributor of products, you need to manage your inventory and earn profit. You need to impress your buyers with the wide range and variety in your merchandise. But you need to handle huge maintenance costs to carry the burden of such a big inventory. You can’t keep selling the old inventory until each and every item of it is sold out. This is when you have to approach wholesale liquidators. Let’s see how they can help
· Every retail store comes to a point when it accumulates some excess inventory. Seasonal items like clothes, holiday décor, etc. sell for a limited period only. Since you are left with products that just won’t sell, you would not want to spend money on their maintenance and storage. By turning these products into wholesale liquidation merchandise, you would get rid of the obsolete and excess items and gain some immediately usable capital.
· If you decide to liquidate Amazon FBA even at a minor loss, you are saved from a substantial cost that you would have lost by holding on to this merchandise in terms of labor, maintenance, storage and depreciation.
So, you can see that wholesale liquidation is not as bad as you think. Liquidating your inventory does not necessarily mean that you are indebted and closing down your business. With a complete understanding of liquidation, you can now utilize your inventory properly and save money in the long run.
Merchandise USA has been helping businesses to turn their obsolete inventory into fast cash for years. Are you still holding back inventory that you want to liquidate? Get a quote from Merchandise USA today.