If you want to start an ecommerce business selling clearance merchandise, this post will teach you how to buy Amazon return pallets for sale at rock bottom prices.
Those of you who shop on Amazon know that their return policy is extremely lenient. Recently, Amazon changed their “no questions asked” refund policy to 90 days which means that consumers can now return almost ANYTHING within 3 months!
As a result, Amazon considers a 10% return rate to be normal for most merchandise but it depends on what is being sold.
Here’s what the typical return rate looks like on Amazon based on product category.
- Books and media: 5-7%
- General merchandise in the home, kitchen and sporting goods: 8-10%
- Consumer electronics: 25-35%
- Clothing and fine jewelry: up to 40%
From the perspective of a seller, sometimes it doesn’t make economic sense to pay Amazon to send your returns back. And for this reason, Amazon carries a large amount of merchandise that it just needs to get rid of.
As a buyer of Amazon returns, you can make a lot of money by refurbishing and reselling used merchandise online.
Are you interested in creating a strong, defensible brand for your products? If so, I put together a comprehensive package of resources that will help you launch your own online store from complete scratch. Be sure to grab it before you leave!
What Are Amazon Return Pallets?
Amazon return pallets, also known as Amazon liquidation pallets, are large wooden boxes and crates that are used to distribute customer-returned items sold by Amazon. These items are sold by Amazon to liquidators and resellers at a discounted price.
The return pallets contain various products such as electronics, clothing, and home goods, allowing buyers to potentially resell items for a profit.
Some people wonder if Amazon pallets are even a real thing. Yes, they are! Every year, Amazon auctions off its returned merchandise to the highest bidder. These auctions typically take place between January and March of each year after the holiday season when consumers return unwanted gifts en masse.
What Kind Of Items Are Included In Amazon Return Pallets?
Amazon return pallets can contain a wide variety of items, including:
- Electronics (e.g., smartphones, laptops, TVs)
- Clothing and accessories
- Home goods (e.g., kitchen appliances, furniture, tools)
- Toys and games
- Books and movies
- Sports equipment
- Outdoor gear
- Pet supplies
- Beauty products
Here’s an example of the products included in a $975 Amazon return pallet.
- AOC 24B1H 23.6″ Full HD WLED LCD Monitor – 16:9 – Black – 1920 x 1080 – 16.7 ($179.99)
- SAMSUNG HW-Q6CT 5.1 CHANNEL SOUNDBAR ($2,771)
- VIZIO V-Series 2.1 Home Theater Sound Bar with Dolby Audio, Bluetooth – V21-H8 ($189.99)
- HP 32S Display 31.5″ LCD Monitor 16:9 – Black/Silver ($287.99)
- Acer K272hl 27 Fhd Led ($299.98)
- Voyager Tony Hawk 27 Cruiser Electric Skateboard Blue ($174.00)
- AGON CURVED VA ($369.99)
- HP Pavilion 22cwa 21.5-Inch Full HD 1080p IPS LED Monitor, Tilt, VGA and HDMI ($134.99)
The total estimated value of this Amazon return pallet is roughly $4409 (excluding broken items).
How To Buy Amazon Return Pallets
You can buy Amazon return pallets in a few easy steps:
- Register on a liquidation website (e.g., Bstock, Liquidation.com, or Bulq)
- Browse available Amazon return pallets
- Place a bid or purchase directly
- Arrange shipping or pick up from designated location
The more you are willing to buy, the cheaper the cost. Typically liquidated items from Amazon are sold either by the pallet or the truckload.
When you buy liquidated merchandise from Amazon, the pallet or bundle will usually carry an “estimated retail value” and it’s almost always sold off via an auction.
Sites selling Amazon return pallets are typically organized by category, lot size, brands, retailers and by location.
Here’s an Amazon return pallet auction that I was looking at the other day.
From the auction description, you have no idea what’s inside those brown boxes and that’s what makes it fun and exciting.
Editor’s Note: Amazon return pallets don’t always come in unmarked brown boxes. Sometimes, you can tell what brands or types of products are contained within the bundle to guide your decision.
The MSRP of $6999 is determined by tallying up the full selling price of all of the items in the pallet but the goods inside can be in any condition. Certain parts may be missing. Product may be broken. And unfortunately you can’t examine the merchandise prior to purchasing.
Buying Amazon returns is almost always a gamble but if you bid less than 20% off MSRP, you have a good chance of making a profit depending on how much time you spend refurbishing your products.
If you end up bidding on and winning an auction, you can arrange to have the pallet shipped directly to your warehouse, but it generally makes more economic sense to look for Amazon liquidations in your geographic area.
Also, remember that most liquidation companies don’t allow refunds or returns on Amazon pallets. For instance, Amazon Bulk Liquidations return policy states that purchases of return pallets are not eligible for returns, refunds, or replacements.
Tips On How To Choose The Right Amazon Pallet
Once you’ve settled on a liquidation company you’d like to purchase an Amazon pallet from, consider these tips on how to choose the right Amazon pallet:
- Start small to test the waters. Purchase a lower-cost pallet under $500 first before buying expensive pallets with name-brand goods that can cost thousands of dollars.
- Choose manifested pallets. Mystery pallets are cheaper but also riskier, because you won’t know the specifics of what you’re buying. Manifested pallets cost more but give you a thorough list of included items, their quantities, and even suggested retail prices. If reselling is your main aim, it’s safer to go with manifested pallets.
- Be selective about what you buy. Avoid items like used electronics, baby products, and products with multiple parts, as these can be risky or hard to resell. On the flip side, simple and functional everyday items are often easier to sell and less likely to be defective.
- Don’t forget to account for shipping costs, which can sometimes make a seemingly good deal less profitable.
Where To Buy Amazon Return Pallets For Sale
Here are the best places to buy Amazon return pallets for sale.
- B-Stock (Amazon Liquidation Auctions)
These Amazon liquidation companies buy from Amazon, online independent businesses and other online resellers, and take a cut of every sale.
Amazon Liquidation Auctions
Amazon Liquidation Auctions is the official b2b marketplace where you can buy overstock merchandise directly from Amazon. In 2018, Amazon partnered with B-Stock to launch Amazon Liquidation Auctions.
In order to bid on an auction, you first have to register with B-Stock and be approved to bid. There is no fee for applying or for being an approved buyer.
Right now, Amazon Liquidation Auctions is only accepting applications from the US and you must have a valid reseller certificate to be eligible.
Editor’s Note: If you are located in Europe, you can register on the Amazon EU Liquidation Auctions marketplace separately.
In the event that you bid and win an auction, B-Stock will require you to submit additional business information as well as payment.
BULQ is one of the biggest sellers of liquidation merchandise on the Internet and they work with many retailers in addition to Amazon.
What I like about BULQ is that there are no auctions. If you see something that you like, you just add it to your cart and check out.
So if you hate auctions, then BULQ might be a better fit.
You also get much more visibility into what’s inside the pallet compared to other liquidation outlets.
For example, here’s a listing for computer equipment on BULQ.
Not only do you get a more descriptive photo of the pallet, but you also get the exact contents of what is inside!
But as with any return pallet, the condition of your products is 100% unknown. Some items may be unfunctional or broken and certain sets may not be complete.
It’s also worth noting that BULQ offers different types of pallet liquidations on their site. While most pallets are “uninspected returns”, you can also find pallets of brand new merchandise as well.
Liquidation.com is the largest liquidation company online and they work with many different retailers in addition to Amazon.
However, every Amazon return pallet is sold via auction. As a result, you must register and bid on a pallet instead of buying it outright.
Here’s an example of a Liquidation.com auction for computer equipment returned from Amazon.
If you squint your eyes and look very closely, you can make out the products and brands that are contained within this mystery package.
But in general, Liquidation.com rarely gives you any information about what’s inside your pallet for sale.
Overall, the auction method can be hit or miss. If you can find a pallet that no one is bidding on, you can get a great deal. But popular pallets often get bid up considerably beyond what the pallet may be worth.
DirectLiquidation.com is another online marketplace offering bulk wholesale liquidation merchandise from major retailers at discounted prices for businesses, online sellers and consumers.
They do a lot of business with Amazon but they also work with well known big box stores like Target and Walmart.
What’s nice about DirectLiquidation.com is that you can perform searches by brand or store.
For example, if you prefer to buy returns from Target, you can have DirectLiquidation.com only show you merchandise from Target.
Similar to Liquidation.com, all sales are conducted by auction and you must first register for an account in order to bid on a pallet.
Here’s a sample auction from Walmart.com.
Out of all of the liquidation platforms discussed thus far, DirectLiquidation.com tends to have the least detailed descriptions of the bunch.
You also have to be careful about the photos used in the auctions as they may not reflect the actual image of the products being sold.
888Lots.com is another online liquidation marketplace offering a vast selection of customer returns, overstock, and closeout merchandise for resellers and bargain hunters.
888Lots.com buys a significant portion of its liquidation inventory from Amazon. But what’s unique about 888Lots.com is that you can often buy individual products at a low price if you are willing to deal with potentially broken merchandise.
Editor’s note: Some items on 888Lots.com are brand new as well.
Here’s an example of a pair of headphones I was looking at the other day. 30% is not much of a discount but sometimes you can find some great deals.
888Lots.com also offers a variety of pallets for sale and like BULQ, they include a description of what’s inside every lot along with the suggested MSRP.
They even include an Amazon profit calculator so you can determine whether it’s worth selling these goods on Amazon.
Overall, 888Lots.com is easily the smallest liquidator out of all of the different liquidation companies mentioned in this article. But there are many deals to be found if you check back regularly.
BlueLots is a US based company that sells Amazon return pallets in addition to other large retailers.
What’s unique about BlueLots is that they don’t charge buyers a fee for buying liquidation pallets. Instead, they make their money by charging the retailers directly.
All sales are auction based and most pallets contain an inventory manifest that describes exactly what is in the pallet along with the condition and MSRP.
Overall, the BlueLots website is very clean and the shopping experience is simple and intuitive.
BoxFox is a B2B marketplace that sells excess inventory from independent retailers and Amazon to buyers via an auction.
What’s unique about BoxFox is that they only sell brand new merchandise instead of selling returns. As a result, you don’t have to worry about the condition of the goods in your pallet.
BoxFox is intended for surplus and clearance inventory and there’s no minimum purchase. As a buyer, you pay a 7% transaction fee and the shipping cost.
How Much Do Amazon Return Pallets Cost?
Amazon return pallets usually cost between $200 and $800, but prices can reach as high as $20,000 for high-value items. The cost depends on the product category, size of contents, item condition, and the liquidation company.
For example, a return pallet consisting of computers and electronics would cost more than a pallet of home goods.
However, when purchasing an Amazon return pallet there is an additional cost of shipping the return pallet to your warehouse. This shipping cost depends on the weight, dimensions and distance from the liquidation company.
You should expect to pay between $300-$500 in shipping expenses per pallet. In some cases, the cost of shipping can exceed the value of the return pallet itself.
Is It Safe To Buy Amazon Return Pallets?
It is 100% safe to buy Amazon return pallets as long as you buy from an authorized Amazon return pallet distributor like Amazon Liquidation Auctions or Bulq. However, the quality and condition of the products you receive in an Amazon return pallet will vary.
Some products may be brand new in its original packaging whereas other products may be missing parts or broken.
Buying Amazon return pallets always carries some level of risk. If you take the time to go through and refurbish the returned merchandise, you can make a significant amount of money.
Do I Need A Business With A Tax ID To Buy Amazon Return Pallets?
Most liquidation companies won’t require a business tax ID when you purchase return pallets.
Some companies such as Amazon Liquidation Auctions and 888Lots.com do require a reseller’s certificate upon creating an account on their site. However, other liquidation companies may not require the certificate unless you want the sales taxes waived.
Make sure to check the liquidation company’s policy on tax IDs and reseller certificates.
Can I Buy An Amazon Return Pallet If I’m Not Living In America?
Yes, it’s possible to buy an Amazon return pallet even if you don’t live in the United States, but the rules for buying pallets vary depending on the liquidation company you choose. The majority of Amazon return pallets are within the US.
Refer to the table below to determine which liquidation companies mentioned in this guide offer international shipping.
|Company||US availability||International availability|
|Amazon Liquidation Auctions||Yes (excluding Alaska and Hawaii)||No|
|Liquidation.com||Yes||Yes (with exceptions)|
|Directliquidations.com||Yes (incl. Canada)||No (buyers must arrange their own shipping)|
How Will Amazon Return Pallets Be Delivered?
Most liquidation companies use freight carriers to deliver pallets. However, the specific delivery method for Amazon return pallets will vary depending on the liquidation company you purchase from.
Here’s an overview of how the companies mentioned might handle the delivery:
- Amazon Liquidation Auctions: If buying directly from Amazon’s liquidation platform, you’ll typically have the option to arrange your own freight shipping or use their recommended carriers.
- BULQ: This company often provides standard ground shipping for their cases, but for pallets, they might use LTL (“less than truckload,” wherein loads are around 150 to 15,000 pounds) freight shipping.
- Liquidation.com: Liquidation.com offers a variety of shipping options, including LTL freight for larger pallets. When you win an auction, the site may indicate whether you can opt to arrange your own shipping or you NEED to arrange your pallet’s shipping.
- Directliquidation.com: If you’re in Canada or the US, they will likely use freight shipping for pallets. They also offer an “Arrange my Own Shipping” option, which’ll allow you to coordinate with a freight carrier of your choice.
- 888lots.com: For pallet deliveries within the US, they’ll likely use LTL freight carriers.
- BlueLots: Given that they cater primarily to US-based customers, they would typically use domestic freight carriers for pallet deliveries.
What Are The Pros of Buying Amazon Return Pallets
Buying Amazon return pallets offers several benefits for resellers and bargain hunters:
- Low Investment: You can purchase Amazon return pallets with a relatively low initial investment.
- Less Storage: Purchasing a pallet or other liquidated products instead of an entire container requires much less storage.
- Cost Savings: Purchasing return pallets often results in significant cost savings, as products are priced at 30-70% off their retail value.
- Product Variety: Return pallets contain a wide range of items from various categories, such as electronics, home goods, and clothing, allowing resellers to diversify their inventory.
- Eco-Friendly: Purchasing and reselling return pallets helps reduce waste by giving a second life to items that might otherwise be discarded.
However, you must be cautious when purchasing return pallets by researching liquidation companies, inspecting manifest lists, understanding product conditions, and considering shipping costs to maximize benefits and minimize risks.
What Are The Cons of Buying Amazon Return Pallets
Buying Amazon return pallets has several downsides as well.
- Unpredictable quality: The condition of items in Amazon return pallets can vary greatly, from nearly new to damaged or non-functional. It can be difficult to assess the actual value of the products without a thorough inspection.
- Incomplete or missing items: Some returned items may be missing parts or accessories, making it difficult to sell them online. Some items may be incomplete, such as sets or bundles with only a portion of the original components included.
- Time-consuming sorting and evaluation: Buyers of return pallets must devote significant time and effort to sorting, inspecting, and evaluating the items to determine their resale potential.
- Limited or no warranty: Most returned items sold in pallets come without any warranty or guarantee, making it difficult to handle customer complaints or returns if you plan to resell the items.
- Storage and logistics challenges: Purchasing large return pallets can require substantial storage space to accommodate the items while they are sorted and prepared for resale. Additionally, the transportation and handling of these pallets can be costly and challenging, especially for small businesses or individuals with limited resources.
How To Make Money Selling Amazon Return Pallets
You can make money selling Amazon return pallets in the following steps:
- Research market demand and average resale prices for desired products.
- Purchase return pallets at a lower cost, ideally at least below 30% of retail value.
- Inspect, sort, and refurbish items as needed.
- Resell items through channels like eBay, Facebook Marketplace, or even your own ecommerce store for a 50-100% profit margin.
This process is known as retail arbitrage where sellers “buy low” and “sell high”.
The secret to being successful selling Amazon return pallets is to take the time to refurbish as much of the product as possible to make it seem “like new”.
There are also several strategies that you can employ to boost the value of your liquidated goods and it’s both an art and a science.
Strategy #1: Repair And Refurbish EVERYTHING
Fixing the item that you want to resell is par for the course, and that’s where most people stop.
But if you can sell a working and FULLY PACKAGED product, you’ll make significantly more money than selling a functional, but unboxed product by itself.
The problem with most Amazon return pallets is that the packaging and accessories are often damaged or non existent. And in order to get top dollar for resale, you must track everything down.
Fortunately, you can often buy empty boxes for popular merchandise on Ebay.
For example, let’s say that I receive a bunch of Apple watches in my Amazon return pallet without boxes or instructions. By performing a quick search on Ebay, I can buy 5 empty Apple watch boxes for $35.
$7 for an empty box might sound a bit high, but a boxed Apple watch will command a 25%+ premium in resale value with the box than without!
As a result, it’s in your best interests to track down the box, the instructions and all of the accessories prior to resell. As an added bonus, you may want to invest in a shrink wrap machine as well!
Strategy #2: Bundle Products Together
Back in the day, I used to buy broken computer equipment for parts that I would strip down and sell individually. But once I had mastered the art of reselling, I discovered that a fully working computer was worth significantly more than its parts.
For example, I could charge a 25% percent premium for a working computer compared to the value of the parts inside.
There are many products that can be bundled together to increase the overall value of your offering. This way, you can sell off more of your inventory in a single shot.
Strategy #3: Accessorize
In many cases, items like electronics are returned because they are missing a charger or some accessory that was not included in the box. Accessories can be easily located on Ebay and can make a huge difference in your asking price.
In general, any item missing from the original box will make your product come across as more used.
For example, a brand new Apple watch WITHOUT the charger will sell for less than a “like new” Apple watch with all accessories and box that is shrink wrapped.
How Much Can You Make Selling Amazon Return Pallets?
If you are meticulous about refurbishing every item in a pallet, then you can make up to a 30-50% profit from every Amazon return pallet that you buy.
It’s important to research the contents of every pallet. For example, you should look up every item (if the information is available) on both the Ebay and the Amazon app to calculate your potential profit.
Evaluate the cost for every piece in the pallet and how much it could potentially sell for and then apply a weighting factor to account for broken merchandise.
With some practice and a little bit of luck, you’ll eventually develop a set of standard operating procedures to buy and evaluate products to sell.
How To See How Much Money A Product Is Making On Amazon
There are a few ways to estimate the profitability of a product:
- Use a third-party tool. There are a number of third-party tools that can estimate the profitability of a product on Amazon. Some examples include Jungle Scout and Helium 10. These tools typically look at a product’s sales rank, price, and estimated shipping costs to generate their estimates.
- Analyze the product’s sales rank. Amazon’s sales rank shows how popular a product is in its main or subcategory. To find a product’s sales rank in Amazon, go to its product page and scroll down to “Product Information.” You can find its sales rank in “Additional Information” (for example, a gaming mouse by Razer, Basilisk V3 Pro, is #74 in PC Gaming Mice). A higher sales rank means that the product is selling well. You can use the sales rank to estimate the number of units of the product that are being sold each day.
- Analyze competitors. Look at similar products on Amazon and check their performance metrics (best sellers rank, number of reviews, etc.) to estimate their sales. Both reviews and best seller rank (BSR) can be found in the product pages. The higher the BSR and positive reviews, the bigger the chance their product has been in the market for longer and has had more sales.
Remember, these methods provide estimates and should not be considered as completely accurate figures. Each has its own limitations and should ideally be used in combination for a more rounded view.
Is Buying Amazon Return Pallets Worth It?
Yes, buying Amazon return pallets can be worth it, as they offer potential profit margins of up to 30-50%. However there is a lot of work involved and it takes experience to identify the most profitable Amazon return pallets to purchase, and understand the most profitable way to sell them.
The main advantage of this business model is that you don’t really need much storage.
Most of the products that you buy from your pallet will be immediately sent back to Amazon’s warehouses for resale or listed on Ebay.
It also doesn’t require much money or technical skill to start because you will be relying on 3rd party marketplaces for your sales.
But in the long run, buying and selling returned merchandise is not easily scalable and it can feel like running on a hamster wheel. You never know when your next pallet will be your last and you’ll often end up with lots of unsellable merchandise.
The main reason I stopped my online arbitrage business was because it had plateaued and I wasn’t willing to invest in more human capital to continue to grow it.
I also had so much junk lying around the house that my wife threatened to divorce me:) But it’s a great way to get started in ecommerce with minimal risk.
So if you are new to selling online, buying and selling Amazon return pallets can be a great way to dip your toes in the water without much risk.
How Customer Returns Affect Amazon Sellers
Customer returns can reduce an Amazon seller’s profit by up to 30%. Below is a list of the negative impacts returns can have on an Amazon seller.
- Lower Profits: When a customer returns a product, the seller must refund the purchase price or provide a replacement and pay Amazon a return processing fee. This almost always leads to financial loss for the seller, especially if the returned item is damaged or cannot be resold.
- Inventory management: Customer returns can complicate inventory management, as sellers need to account for returned items and determine whether they can be resold or not. This may require additional time and resources to inspect and process the returns, leading to increased operational costs.
- Seller performance metrics: Amazon closely monitors a seller’s performance metrics, including return rates. A high return rate can negatively impact a seller’s performance metrics and may lead to a lower seller rating, reduced visibility in the search results, or even an account suspension.
- Customer reviews and feedback: Returns can result in negative customer reviews or feedback, especially if the buyer is not satisfied with the product. Negative reviews hurt a seller’s reputation and reduce the conversion rate for sales.
- Loss of sales rank: When a product is returned, the sale is essentially reversed, and the product’s sales rank may be negatively impacted. This reduces visibility in the search results and sales.
To minimize the impact of customer returns, Amazon sellers should focus on providing accurate product descriptions, high-quality images, and excellent customer service.
They should also ensure that their products meet or exceed customer expectations and work to address any issues promptly.
Where Do Amazon Returns Go?
Amazon returns are typically sent to return processing centers where they are carefully inspected. Depending on their condition, items are either restocked, sold to a liquidation company, donated, or recycled.
If the returned item is in like-new condition and can be resold as new, it may be restocked and listed for sale again.
If the item is not in perfect condition but is still functional, it might be sold through Amazon Warehouse as an open-box or refurbished item at a discounted price. Amazon may also sell the product to an Amazon liquidation company.
Items that don’t meet the criteria for restocking or reselling through Amazon Warehouse may be donated to charitable organizations through programs like Amazon’s FBA (Fulfillment by Amazon) Donations program.
In this program, eligible items are given to nonprofits and charities that can use or distribute them to those in need.
Finally, if an item is damaged, defective, or otherwise unsuitable for donation, it may be sent to a recycling facility, where it will be processed and disposed of in an environmentally friendly manner.
Amazon Return Pallets Vs Amazon Truckloads
For those looking to acquire multiple pallets at once, purchasing Amazon returns by the truckload is a good option.
While the initial investment for truckloads may be higher due to the volume, the cost per item often becomes lower resulting in higher margins and potentially higher reseller profits.
Amazon truckloads contain the same products that can be found in an Amazon return pallet, but just in larger quantities. However it’s also possible to buy truckloads filled with larger appliances such as refrigerators, dryers, air-conditioners, and even furniture.
Some liquidation companies mentioned in this guide offer Amazon return truckloads, like B-Stock, Liquidation.com, Directliquidation.com, 888lots.com.
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Steve Chou is a highly recognized influencer in the ecommerce space and has taught thousands of students how to effectively sell physical products online over at ProfitableOnlineStore.com.
His blog, MyWifeQuitHerJob.com, has been featured in Forbes, Inc, The New York Times, Entrepreneur and MSNBC.
He's also a contributing author for BigCommerce, Klaviyo, ManyChat, Printful, Privy, CXL, Ecommerce Fuel, GlockApps, Privy, Social Media Examiner, Web Designer Depot, Sumo and other leading business publications.
In addition, he runs a popular ecommerce podcast, My Wife Quit Her Job, which is a top 25 marketing show on all of Apple Podcasts.
To stay up to date with all of the latest ecommerce trends, Steve runs a 7 figure ecommerce store, BumblebeeLinens.com, with his wife and puts on an annual ecommerce conference called The Sellers Summit.
Steve carries both a bachelors and a masters degree in electrical engineering from Stanford University. Despite majoring in electrical engineering, he spent a good portion of his graduate education studying entrepreneurship and the mechanics of running small businesses.