In our previous post about returns management, we illustrated what an optimized returns desk and process looks like. In an ideal world, all of those returned products would go right back into inventory, ready to ship to a new customer.
But of course, that’s not how it actually goes. Returns arrive at your warehouse in various conditions: open box, obviously used, damaged, etc. The returns that arrive in a new, unopened state are few and far between.
So what do you do with those items that can’t be sold as brand new? And how do you speed up the process of figuring that out?
Enter Octolan’s upcoming intelligent liquidation feature to guide your team through the process with a minimum of fuss.
The Potential Hassle of Returns Liquidation
Depending on your agreements with the retailers and vendors whose returns you handle, liquidating those unsellable items can be varying degrees of painful. You have to evaluate each product’s condition, investigate recent online sales and current listings to determine what the same product in similar condition is selling for, and try to pinpoint a value to recoup some of the loss on that product.
If your vendors don’t want to go through all this effort themselves, they may tell you to keep the returns and give them a percentage of whatever you can get for it or simply “gift” you these items. This leaves you even more on the hook for squeezing the most value you can out of each item. If you’re trying to figure this out manually, you may miss out on significant revenue over the course of a year, either by listing items for lower than their actual value or disposing of items you could have sold.
Intelligent Liquidation Recovers Value from Liquidated Product
Octolan’s intelligent liquidation feature (coming soon!) will save you from this potential loss. Using information scraped from current and recent product listings on sites like eBay, our algorithm will evaluate pricing for similar items to your returned product and give you a suggested value for liquidation.
If you are liquidating these items yourself, the intelligent liquidation feature can also use images and information captured during your returns process to help you create and write an eBay listing. If you need to move certain items quickly, it can also determine a price 5% lower than other listings to ensure yours is the lowest and help you sell it faster.
If, on the other hand, you’re selling pallets or truckloads to a liquidation company, this feature can help you negotiate a better price. You can scan items onto a pallet, then use the algorithm’s suggested pricing to set the value of the manifested pallet as a whole. Because the software has used information from both your returns inspection process and similar items sold online, you’re in a better position to prove that value to a liquidator and close a better deal.
Another way this feature helps you get a better deal is reassuring liquidators that the value you set is correct. Normally, liquidators assume a portion of each pallet they buy will be trash that they’ll have to dispose of or recycle. In the case of electronics, this can even cost the liquidator money in order to recycle the products that can’t be sold. But when they buy your pallet of goods that’s gone through a thorough disposition process, they can safely assume that pallet won’t be full of garbage. This makes your pallets much more attractive to liquidators – making your unsellable returns much easier to offload.
We’re excited to be able to offer 3PLs the ability to squeeze more value out of returns liquidation. Stay tuned for this feature!