What Happens to Returned Goods?
News and Information

What Happens to Returned Goods?

By June 12, 2023 June 14th, 2023 No Comments

Every month, customers return thousands of products to big retailers such as Target and Walmart. So, what do these companies do with customer returns? What is reverse logistics? Let’s take a look at Liquidation Returns!

What are reverse logistics?

Reverse logistics is the process of planning, implementing, and controlling the efficient, cost-effective flow of raw materials, in-process inventory, finished goods, and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal. It includes all activities related to the reuse, repair, refurbishment, recycling, and disposal of products and materials. Reverse logistics is an often-overlooked part of the supply chain that can have a significant impact on a company’s bottom line.
The concept of reverse logistics first emerged in the early 1990s as businesses began to recognize the potential for recapturing value from returns. As customer expectations for returns grew, organizations realized that it was no longer enough to simply discard a returned product – they could either recover some of its original value by reselling it or breaking it down into components for reuse.
With the rise of e-commerce, reverse logistics has become much more important. The ability to quickly and easily return purchases has become a key factor in customer satisfaction, and companies are increasingly focused on making the returns process as efficient as possible. This means investing in things like tracking systems, dedicated return warehouses, and sophisticated technology to facilitate the process.
Reverse logistics is becoming even more critical as the focus on sustainability continues to grow. Through reverse logistics, companies can reduce waste and ensure that materials and components are properly recycled or disposed of in an environmentally friendly way.
It’s clear that reverse logistics can provide businesses with a number of benefits. It can increase profitability by recapturing value from returned items, improve customer satisfaction, and contribute to a more sustainable business model. For these reasons, it’s important for companies to invest in reverse logistics if they want to stay competitive.

What happens to returned goods?

Returned goods can be a frustrating experience for both customers and businesses alike. It often means that the customer is unsatisfied with the product and may have wasted their money and time. On the other hand, businesses are then left with the task of dealing with returned goods and deciding what to do with them.
When goods are returned, the business must decide how to process them. The most common scenario is to inspect the item to assess the damage or wear before deciding what will happen next. Depending on the condition of the item, the business may decide to do one of several things.
First, if the item is in perfect condition, the business may choose to resell it as if it was a brand new item. This produces an additional income for the business through its sale, as well as increases customer satisfaction in the future.
Second, if the item is still in good condition, although slightly worn, it may be possible to repair it and then resell it as a “refurbished” or used item. Again, this allows the business to make extra income off of the returned item while still ensuring customer satisfaction.
Third, if the item is too badly damaged to resell, the business may choose to donate the item to a local charity or sell it for parts. By donating items, the business can benefit from any tax deductions associated with the donation as well as maintain good relationships with the local community.
Finally, if the item is considered to be a hazard, it is important to dispose of it properly to avoid environmental pollution or other safety risks. Many businesses work with recycling centers and hazardous waste management companies to handle dangerous items safely and responsibly.
Regardless of how the item is classified, it is important for businesses to have a clear process in place for dealing with returned goods. This way, they can ensure that customer satisfaction is maintained and that their business is operating efficiently.

What Do Big Retailers Do with Their Customer Returns?

Returned items are categorized as secondhand and are also often considered surplus-to-requirements. All of the big-name retailers aim to make some sort of return on any type of returned merchandise. This is also known as reverse logistics. This merchandise is ususually sold as liquidation returns.

They look at selling it as quickly as possible to ensure that it doesn’t take up space in their warehouse or store space. Additionally, Retailers are prepared to take quite a hit on the price they could have expected for this item if it was sold and not returned So, instead, they choose to sell their returns in bulk to liquidators and wholesalers. Amazon returns liquidation is one of the most popular liquidation types sought after in the reverse logisitics after market.

Liquidators, such as Direct Liquidation, then choose to sell these returns to their business customers for considerably less than their MSRP value. This means that there are far greater profits to be made for far less than their MSRP value. What this also means is that there are even greater profits to be made when resellers sell them to the public. 

Direct Liquidation, for example, and other Liquidators often buy returns from the three biggest retailers in the United States, which are Target, Walmart, and Lowe’s Hardware. They then list them for sale in pallets and box loads on the online liquidation marketplace. We all have our own niche way in this industry of turning these loads that Retailers are looking to dispose of, into a profitable business. 

You will find customer returns on the liquidation marketplace in many different categories, including:

  • Automotive
  • Books
  • Clothing
  • Shoes and accessories
  • Electronics
  • Food
  • Furniture
  • General merchandise
  • Health and beauty 
  • Home
  • Home improvement
  • Industrial supplies 
  • Movies
  • TV and media
  • Music
  • Office
  • Party and occasions
  • Patio and garden
  • Pet toys and pet supplies
  • Sports
  • Fitness and outdoors
  • Toys

Within these different categories, you can find wholesale merch coming from some of the biggest manufacturing brands in the world such as Samsung, Apple, BOSCH, Fisher-Price, Mattel, Sony, Microsoft, DeWalt, Google, LG, HP, and many more brands. Take a look our list of Liquidation truck loads we offer on our home page!

Skip to content