The Differences Between Wholesalers and Liquidators

The terms wholesalers and liquidators are often confused with one another. For certain services, there does not seem to be much of a difference between the two either. Both are suppliers to retail businesses that sell their merchandise to the end customers. So, the two terms share some similarities in their models, however, diving past the surface, there are major differences between the terms. These differences directly affect how much profit the retailers can enjoy. Read on to find out about wholesale liquidators in Canada!

What Do Liquidators Do?

Experienced wholesale liquidators in Canada provide their services across a range of industries. They purchase the assets of businesses in bulk that are closing down and then sell those items to other wholesalers or retailers for a profit. Since they buy everything in bulk, they make a tremendous amount of profit compared to what the selling company could have made by buying the assets separately.

Most liquidators also manage online liquidation marketplaces. It’s in these marketplaces that retailers can sell the products to wholesale or retail businesses through an auction.

In another scenario, retailers sometimes find themselves stuck with massive amounts of merchandise that nobody wants. These are usually items returned by customers for several reasons, such as the items being damaged, faulty, or even because they simply changed their minds.

Retailers may find items returned back to them for having the tiniest faults. Legally, such items cannot be classified as new for resale. Retailers want to get rid of this unwanted stock that inevitably starts taking up storage space.

Along with returns, retailers are also eager to get relieved of overstocks, which can be regarded as an industrial surplus in Canada. For example, seasonal merchandise such as Christmas decorations that do not sell is unlikely to be sold until the next Christmas rolls around. Throughout the year, they take up precious storage, and to add to retailers’ woes, they may also get stuck with closeouts.

Closeouts may be products left over from retailers’ stores that are either getting shut down or being restructured. In any case, the bottom line is that retailers are stuck with merchandise nobody wants and takes up their storage space. This is where liquidators come in.

They have more experience and resources to purchase almost everything offering better prices and less hassle to the businesses. For this reason, businesses that are closing down find themselves at peace while dealing with liquidators.

Who Are Wholesalers and How Are They Different?

Wholesalers buy merchandise from both manufacturers and liquidators in Canada. This bulk buy is then broken down into smaller packages. Finally, these packages are then sold to retail businesses at a fixed wholesale price.

Sometimes, these packages are bought by other smaller scale wholesalers, who sell the packages at a higher price. Therefore, the longer the goods keep getting exchanged, the higher the prices go. Since wholesalers purchase new products directly from manufacturers or buy used products from liquidators to sell them to retailers, they tend to have higher prices than liquidators.

Michaels Global Trading is one of the most well-known names in the business. To read more about our role as top-tier liquidators, visit our website!

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