Strategic liquidation: Don’t flood eBay
EBay.com may be the only game when it comes to online auctions, but merchandise liquidators are learning it’s not the only game when it comes to using the Internet to dispose of excess merchandise. Two years ago, 80% of liquidator Excess Technologies LLC’s revenue came through eBay auctions; today, that portion is down to 5%. “If you have 200 of something that you want to sell in faster than a year, you’ve got to find places other than eBay to sell it,” Joel Holtzman, president and CEO of Excess Technologies, says.
Liquidators found the enthusiastic users of eBay to be great prospects for unloading merchandise. But they also have learned that too much product available at eBay depresses the price. For instance, Excess Technologies has been liquidating cots. “If we have more than five a day at eBay, prices will go down by 10-20%,” Holtzman says. “If we keep adding, the prices keep going down.”
Excess Technologies now sells liquidated merchandise at Amazon and Yahoo stores, Yahoo auctions, Overstock.com as well as at eBay. It also sells wholesale at Bid4Assets.com, Overstockb2b and eBay’s wholesale operation. It also maintains a database of 1,500 registered buyers to whom it makes product available, based on the channel that the buyer operates in and the strategy of the seller. So, for instance, if a seller wants to liquidate some merchandise in bulk and sell the rest over eBay, Excess Technologies would not sell any of the products to the eBay sellers on its list.
“It’s strategic liquidation,” Holtzman says. “Rather than blowing it out there and degrading the price or the brand, you make decisions about where and how to sell it.”
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