In summary, retail returns, or return pallets, refer to products that have been returned by customers and are sold by retailers in bulk on pallets. These products may have been returned due to customer dissatisfaction, late delivery, or other reasons, and may be in various conditions including damaged, missing parts, used, or brand new. The process of purchasing return pallets typically involves searching online for available products, determining the estimated profit, and placing an order. It is important to carefully review the condition and contents of the pallets before making a purchase.
For 2021 the total U.S. sales are more than $761 billion, of which $218 billion is online. For every 1 billion in sales, there are an average of 166 million merchandise returns. Most of these returns are made with a receipt and only 15.6% return without a receipt. For every $100 worth of merchandise returns accepted, retailers lose $10.30 to returns fraud.
And while returns are a great way to improve the customer experience both online and in-store (the highest percentage of returns come from loyal customers), there is a hidden risk from behaviors like shoplifting, collusion, wardrobing and more. To reduce losses and avoid management, storage, maintenance, inspection, etc. of these products, retailers sell them in bulk on pallets even without checking the condition and accessories of the returned products. This is how the return pallets and liquidation market are created.
What are Amazon Return Pallets?
Amazon is the largest retailer both globally and in the US. With a 41% share of the US market, Amazon dominates the market. Their massive market share works thanks to 110 warehouses, also called fulfillment centers, in the U.S. and 185 worldwide. By the end of 2023, Amazon is expected to have at least 355 large warehouses and fulfillment centers totaling 29 million square meters.
That’s a lot of warehouse space for a lot of products. When Amazon does something, they do it big. They sell big, they have massive discounts, and they have huge returns and liquidations. As mentioned earlier, the average return rate is 16.6%. And that’s millions.
Where do you buy Amazon Returns Pallets?
There is a special Amazon program to buy return pallets and there are great liquidators like Eurolots.com that buy selected products. The products we choose are best sellers, low prices, and top brands from different categories.
The two terms are often used interchangeably. However, there is a slight difference. Usually, return pallets are products that were shipped to an end customer and returned because they did not meet the customer’s expectations. They could be no longer needed due to late delivery, or for some other reason. The product may have damaged packaging, it may be missing parts, it may be used, it may have scratches, or it may even be brand new.
Liquidation inventory usually applies to FBA (Fulfillment by Amazon) goods, if Amazon sellers have products with low sales and/or high storage costs, to avoid disposal and storage fees, they can liquidate the excess inventory for a net profit.
Return Pallets vs Overstock
Very similar to the previous point. For example, a salesman with many Christmas decorations cannot sell before and during the holidays. In January, they will only factor in losses, as sales will be very low if not zero. This excess inventory will be liquidated and sold in the form of items, pallets, and in some cases even truckloads.
Returned Pallets vs. Surplus Inventory
Surplus is the same as overstock. The seller was hoping for better sales and/or decided to buy large quantities to get better prices from manufacturers. Unfortunately, due to market conditions or miscalculations, sales did not turn out as expected. This also happens with goods with a short shelf life such as dietary supplements, food, etc.
How does the process work?
At Eurolots we buy pallet returns from all Amazon fulfillment centers in Europe (except the UK) and that is currently (2021) in total:
All of the inventory you see on our website under Items or Lots is in stock at our warehouse. Our lots are not mystery pallets. All of them have detailed manifests. All items that are part of the lot (no matter what the size of the lot is) have a picture and title. There is also a link to the Amazon website where you can easily check the reviews and description of the product. There is an FBA calculator that you can use to determine the estimated profit per lot or per product. All of this is to make it easier to purchase pallet returns for resale and increase profit.
We receive return lots and items in different states. So, pay attention to the status and buy return pallets accordingly.
- Brand New – These return pallets are items and lots that are unused and unopened. Complete sets with no missing or damaged accessories or parts.
- Box damaged – Return pallets or individual items that are complete sets with no missing parts may be returned by customers with or without a receipt. The packaging may also be damaged during shipping or storage. Problems with the items are not expected.
- Inspected Customer Returns – These are returns with receipts. When returned to the fulfillment center, they are inspected. The products can be used normally and should function as recommended by the manufacturer.
- Uninspected Customer Returns – These are the most controversial items. The items can be in any condition, including the pallet returns mentioned above. The majority of items are regular returns for refund or to purchase another product that better suits the customer’s needs. However, there are also fraudulent returns. In other words, the product may be used for a few days/weeks and then returned. Problems with missing parts and accessories are possible. Signs of use, scratches, and a generally non-functional condition are also possible.
- Poor condition – pallet returns with damaged products. It is recommended for repair workshops and centers only.
Buyers of such pallet returns should be aware that there is a risk and that some products cannot be used immediately unless you also factor in repairs. Keep in mind that uninspected pallet returns literally mean that no one has opened or inspected the condition of the product, packaging, etc. There is a chance that the product is fine and will make a great profit, but there is no guarantee. A good practice is to buy 3 pallets as out of 3 pallets, 2 are suitable for sale. There is a risk, but the prices are extremely low, so we have many customers who know how to take advantage of these Amazon returns, and they do.
At Eurolots we aim to provide the best customer experience and that requires flexibility. We have provided several options to buy pallet returns besides the standard “Add to Cart” button. To do this, we have enriched the customer experience with:
- Negotiate – you have chosen pallet returns with a specific lot number and have a specific cost in mind. Get in touch with us. Make an offer and our sales manager will review it. If it’s a fair offer, you could be getting a bargain.
- Make a lot – put items together into a lot and buy at a profit pallet returns with only selected merchandise.
- Fixed price lots – This is where the big discounts are. Some pallet returns can have a discount of up to 90%. Anyone can make a profit with such discounts. So be sure to check out the promotion pages.
- 0,05 € lots/ 1,00 € lots/ 5,00 € lots – Self-explanatory. The pallet content corresponds to the average price unit indicated in the category. So, a 1-euro lot with fifteen items costs 15 euros for the entire pallet.
There are a lot of opportunities for profit when purchasing return pallets from Eurolots. Wholesalers can use the lot manifest to easily combine several pallets with returns and get multiple items of the same kind. Manufacturer suggested retail price along with the Amazon price, gives all the information you need to estimate prices and profits, not only for whole lots but also per product in the pallet.