Let’s get right into it. I know why you are here.
How to profit from the $1 billion in customer returns Costco takes back each year:
- Get a Resale Permit for your State.
- Register on the Costco Liquidation site.
- Download manifests of auctions that interest you.
- Research prices on marketplaces like eBay
- Research some more.
- Start bidding on small auctions. Be conservative.
- Win your first small auction.
- Receive and sell those items.
- Get your investment back.
- Make mistakes, learn, repeat, and profit.
Let’s dive deeper into each of these action items today.
- To get a resale permit for your State, search for “Your State + Resale Permit.” You will need this permit to buy from legitimate liquidation auction suppliers. Get a complete list of links to each State.
- Why start with Costco liquidation products? It’s a great place to learn with minimal risk and varied investment amounts. You can win auctions from a few hundred dollars to tens of thousands
The Costco auctions all have terrific manifests and the condition of each item is clearly listed.
Costco is great to deal with in the event of any problems with your order.
Get registered with the Costco auction site.
- Detailed manifests are crucial. Never buy products without one. You will have 2-3 days to research the items listed on each manifest to see how much you can bid on the auction. Be ready for many auctions not to “work.” This is OK! This means you are doing your research correctly.
- Whoever does the most research wins! A quick and easy way to research sold listings of the products you are interested in is on eBay. Use the advanced search option to see actual sold prices.
For large items selling locally, check Facebook Marketplace. Find a seller near you selling items in a category you are interested in. Click their profile, click Sold Out listings – now you can see what the products are actually selling for.
- Research more – don’t be in a hurry to buy. Watch the auctions that you research to see what they sell for. Did your research make sense?
Or do you need to figure out why items sell for more than you think they should? This is an important problem to solve.
Use my Purchasing Equation spreadsheet template to help you calculate your maximum bid, based on your research of what the products have sold for.
- Start bidding. Focus on small-dollar liquidation auctions to minimize your risk. Expect to lose most bids—this is a feature, not a bug. Never let your emotions cause you to bid higher than what your research says you should pay.
- Winner, winner, auction bidder! Once you win your first auction, make your payment quickly. You are building a long-term relationship.
- Your products arrive, you have your space ready to receive them, and the sort begins. Use the “cash-back” method to quickly find what items you can sell to get your investment back. This is crucial. Focus on selling those items first.
- Keep your mind on your money and your money on your mind. You have sold the “cream” products, and you have your initial investment back. Congrats!
- You will make mistakes. Be prepared for this. Don’t let mistakes slow you down. Learn from them and apply that knowledge to the next deal. Keep a “next play” focus in your mind.
Document what works and what doesn’t. Try new things and adjust. Keep a database of what sells and what the dogs are.
You will have items that never sell, but since you used my cash-back framework, this is OK. Those never-sellers will have $0 of inventory value. Find somewhere to donate or recycle them.
Once you have a working system, you can begin buying from more sellers, such as Ace Hardware, Target, Footlocker, Petco, and others.
Keep researching and keep experimenting. The profits are in the averages over time – not each deal will be a home run.
Keep learning and building your skills while you expand your Revenue Stack.
If you want to learn with 1,949 Entrepreneurs who are helping each other succeed, skip one cup of fancy coffee each month and join our $5 Reseller Mastermind.
Cheers to your success!
~ Shannon Jean
