Making online purchases is becoming the preferred shopping method for many consumers. There are multiple ways to start selling online, but there is one that is easy, cheap and with a potential profit: flipping Amazon return pallets.
In this article, we'll explain what Amazon return pallets are, where to find them, and what to look for when buying one so you get one that you can flip for a bunch more money than you paid for it.
Related reading: How to Import From China to Sell Profitably
What Are Amazon Return Pallets and Why Are They For Sale?
Certainly, Amazon's free return policy is having a knock-on effect on the practice of buying and selling Amazon return pallets. The giant retailer offers free returns in certain cases to customers (e.g., damaged items, late arrival, etc.), which has led to an increase in the number of product returns.
Every product returned to Amazon is inspected and if it meets Amazon's high standards to be resold as new, it’s re-listed for sale. If they can't be resold as new, Amazon gathers all of these returns (millions upon millions of them each month), puts them on pallets and sells them to liquidators like Liquidation.com.
The pallet you're buying could be a pallet of brand new Nintendo Switches or it could be a pallet of used cooking woks, dirty socks, and soiled dog beds. Sometimes the pallet liquidator gives you a summary of what's on the pallets and sometimes it's completely blind. See more below.
You can make a lot of money by refurbishing and reselling used items online.
How to Buy Amazon Return Pallets
As a result of returns and the significant cost sellers shoulder to put products back on sale, they look for easier and more economical ways to sell them: liquidation.
Amazon accumulates many products that are packed on Amazon pallets for sale with either random merchandise or sorted into specific categories. Entrepreneurs can find a great opportunity to profit on the secondary market if they buy Amazon return pallets.
Instead of going through a middleman who purchases and processes the merchandise and then sells it to you at a profit (reducing your potential profit to cover the costs and profit of the middleman), you can find available Amazon customer return pallets at liquidation platforms.
Liquidation companies are the best way for buying Amazon return pallets.
What Can You Expect From an Amazon Pallet Sale?
Amazon customer return pallets are usually sold in bulk with a large variety of different products, such as clothing, electronics, beauty products for women, games, watches, headphones, devices, video games, accessories, anything related to home improvement or any other category.
Here’s an example of liquidation auctions from Liquidation.com:
So for the example above specifically, you get 84 items with a suggested retail price of $2,168, and right now the top bid is $240.
Usually, there are a couple of photos that oftentimes aren’t really helpful, so you don’t get a view of the whole pallet. But on some liquidation websites, you can see all the articles the pallet includes because they provide buyers with a manifest of various pages, where they list every item that’s in there.
The caveat is the items may be in bad condition. Some items will be ready for resale immediately, others might require some repairs, and some can only be sold for parts.
Occasionally, you can also see on the manifest that even though each bundle is categorized, there are still some random items in each pallet.
How Much Can You Make Buying and Selling Amazon Return Pallets?
If you buy Amazon return pallets, you have a list of items like the above, then you need to start doing your own due diligence to figure out how much money you can make.
In a manifest like the above, you're given a list of Amazon ASINs. An ASIN is Amazon's unique code that it gives to each item in its catalog and each item can only have one page on Amazon.
Take this ASIN and go to www.amazon.com/dp/[ASIN]. So, for example, the Fast Lane Sand Shark item above has an ASIN of B01K26TIDQ meaning the page on Amazon for that product is www.amazon.com/dp/B01K26TIDQ.
Now you want to use a tool like Helium 10 to show you exactly how many items a month that product is selling on Amazon. Regardless of whether you plan to resell your items on Amazon, eBay, or at a garage sale, seeing how many units a month that product is selling is a good indication of how easy that item will be to resell.
In this case, we can see that this product is selling about 1 or 2 units a day. It isn't huge, but if you're able to win the buy box you can expect that it would take you about 15 to 30 days to sell out of this product – not bad.
Related Reading: Helium 10 vs. Jungle Scout – What is Better?
How to See How Much Money a Product is Making on Amazon
Many people when they buy Amazon return pallets will actually want to resell these items back on Amazon. You can easily go on to Amazon and see how much money an item is selling for but the big question is – do these items actually sell on Amazon?
Thankfully, there is software that will tell you exactly how many units of a product are being sold a month and how much money they're making.
Tools like Helium 10 will show you exactly how much money a product is making each (and they will show you sales data for months and years ago as well). If you're planning to buy Amazon pallets and resell them on the platform, a tool like Helium 10 is absolutely required.
You can use the coupon code ECOMCREW6M20 to get 20% off the first 6 months of Helium 10 (affiliate link)
How Much Does it Cost to Buy Amazon Return Pallets?
Prices for Amazon liquidation pallets will vary depending on the liquidation website (some prices are fixed while others run via liquidation auctions) and the size of the pallet.
In general, the prices per pallet can range from $100 to $5,000, depending on the quality and the value of the items. Also, others can be as high as $10,000.
Shipping options and rates will also vary per liquidation company. You will need to pay for the shipping of the pallet, which depends on the weight, dimension, and distance from the warehouse to your address. However, others will offer you a flat rate or free shipping. Often though, expect to pay $50-$100 in shipping per pallet in addition to the cost of the pallet.
Overall, shipping costs could be more than the combined amount you pay for the items on the pallet.
How to Make Money Using Amazon Return Pallets
When you're buying goods for cheap and hoping to sell them for more money, this is what is called Retail Arbitrage. Retail arbitrage is one of the easiest and cheapest business models for someone that is starting out with ecommerce. Many entrepreneurs have turned this gig into a full-time income job.
Retail arbitrage has pretty good margins and is also fairly easy to get started, but requires you to constantly be hunting through the discount aisles of places like Walmart, Home Depot or liquidation websites to find good deals and sell them on any platform like Amazon or eBay.
Buying pallets of goods reduces a lot of this work because now you're buying dozens or hundreds of items at a time instead of just a few.
When selling Amazon return pallets, you can start with a smaller capital compared to private labeling and wholesaling. Some sellers test the waters first by buying $200 Amazon return pallets to see if the system works.
Furthermore, you don’t have to put in much marketing effort because the brands are doing it themselves.
However, it’s important to remember that simple as it may be, it’s still a business endeavor and requires work and planning on the part of the seller.
When choosing Amazon return pallets, most of the time you are paying a much lower cost per item than you would get from buying from retail stores and sometimes even wholesale. And even though some items in the pallet turn out to be unsellable, you can still keep them for your own use!
The downside of this is that most of the liquidation websites only ship to the US. In this case, you can find other options like Craigslist or some other liquidation platforms that are not as popular as the ones will mention below.
Where Can I Buy Amazon Return Pallets?
Here are some of the liquidation companies that sell Amazon customer return pallets:
Amazon Liquidation Auctions, the authorized b2b platform, allows direct purchase of Amazon's overstock goods. This marketplace was established in 2018 through a collaboration between Amazon and B-Stock.
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.
BStock is like an eBay of pallets where you can get a pallet from $300 to greater than $5,000. However, they only sell Amazon liquidation to the United States and Europe.
Direct Liquidation is an online marketplace that allows resellers to purchase liquidated or overstock merchandise. This wholesale marketplace works with big stores like Walmart or Lowes, and the website will enable you to search by brand or store.
All sales are conducted by auction. Therefore, pay more attention if you decide to make bids for a pallet since this platform doesn't have much information about the pallets you are bidding for.
Liquidation.com is one of the largest liquidation online companies. It works with many retailers and is popular among consumers who buy Amazon returns for their reselling business.
Just like Direct Liquidation, Liquidation.com sells Amazon return pallets through auctions. Liquidation.com also does not give any information about what type of products is contained in each pallet.
Craigslist is a hidden gem in regards to getting Amazon pallets of merchandise. There’s a good chance you’ll get a great deal here, although you may not find many results depending on the area where you search.
This is a pallet liquidation place with general merchandise liquidation. 888Lots is located in New Jersey so freight might be an issue if you’re on the west coast area.
Additionally, they require a valid resale certificate for customers based in the US and a valid business registration for non-US customers.
What’s nice about 888Lots.com is that you can buy individual items with great discounts but the majority of the merchandise can be damaged, so it’s up to you to take the chance or not.
Additionally, they include all the details and descriptions of what’s inside each pallet and even they provide resellers with an Amazon profit calculator tool so you can find out if it's worth it to sell these products.
6 Liquidation Warehouses
You can find liquidation warehouses in the big cities of any US state.
Often online liquidators and returns sellers just straight up lie about the content percentages and values, knowing people will just take it and not complain. But if you can get your eyes on the pallet in person, you're already ahead of the game.
Simply, you can do a Google search to find out which is the closest liquidation warehouse to your city.
Can I Buy Amazon Return Pallets Directly from Amazon?
Amazon typically handles returned items in a bunch of different ways, like returning them to inventory, selling them on Amazon Warehouse Deals, or liquidating them through third-party liquidation companies.
On May 10, 2023, Amazon kicked off its beta test for the Amazon Liquidation Store. The Amazon Bulk Liquidations Store sells lots of Amazon or third-party seller items, which may include overstock or damaged products. Lots are sold as-is, with fixed quantities and prices.
Ordering is similar to standard Amazon purchases, but limited to one lot per transaction, with detailed listings for each lot, with shipping occurring 14 days after purchase and returns, refunds, or replacements are not accepted.
You can also review product information, safety warnings, and disclaimers on the product detail page before making a purchase, with links available in the Lot Manifest section.
Importantly, you cannot resell products you buy here on Amazon.com or its other marketplaces, and you have to stick with the shipping options they give you, even if they take a bit longer than regular Amazon shipping.
For support and inquiries, you will need to contact a dedicated customer service team at email@example.com, as this beta test has its own system separate from Amazon customer service.
Do I Need a Business with a Tax ID to Buy Amazon Return Pallets?
In general, you don't necessarily need to have a business with a Tax ID to buy return pallets from liquidation companies.
Many liquidation companies allow individual buyers to participate in auctions and purchase pallets or other items without a business Tax ID.
Can I Buy an Amazon Return Pallet if I'm Not Living in America?
The vast majority of Amazon return pallets are within the United States of America but there are other options outside of America for buying and flipping Amazon pallets.
- Canada: I'm Canadian and my preferred liquidation site for Canadians is Direct Liquidation. Most of the pallets are located in Ontario.
- UK: In the UK there are a bunch of good options for buying return pallets including WholesaleScout and Wholesale Clearance UK.
Outside of Canada, the UK, and America, most countries in the world have liquidators that sell pallets of returned items however often these liquidators will be very old school (i.e. in-person auctions).
Also, some liquidation platforms offer international shipping, including B-Stock, Liquidation.com, and Direct Liquidation. If you want to get an estimate of the shipping costs, you can contact them directly or check with a freight forwarder who specializes in shipping goods to your country.
The shipping price range will depend on factors such as the weight and size of the pallet, the shipping method, and the distance between the origin and destination.
Tips on How to Choose the Right Amazon Pallet
- Compare different liquidation companies. There are lots of different liquidation companies out there. Try to buy Amazon returns pallets at lower costs which can maximize your margins. Your real profit is often on the buy side.
- Make a small investment first. See what the experience of buying a pallet is like at first. Avoid the temptation to buy $4000 name-brand goods.
- Don’t buy a pallet of used electronic items for the first time. There is a high possibility that the items won’t work, and if you don’t know how to fix them, it will turn into a total loss.
- Other items to avoid include baby items (safety concerns), cooking products (high likelihood of being used and difficult to resell) anything with lots of parts and accessories (high likelihood some parts have been lost), and electronics.
- Good items to look for: The simpler the items the better chances the items work fine and can be resold easily – exercise dumbbells are a good example. Name-brand goods are also the best but again, ensure that the likelihood of something being wrong with them is low (again, avoid electronics)
- Beware of Shipping. Some liquidation companies will charge you for the shipping of your Amazon return pallets. Check freight costs before buying an Amazon return pallet. It could be more expensive than the amount you pay for the goods.
Where Do Amazon Customer Returns Go?
According to many Amazon third-party sellers, dealing with customers abusing Amazon’s lenient return policy is considered part of the business.
At least 30% of online orders are returned and nearly 9% of products are returned to brick-and-mortar stores. One big reason for this is that retailers offer customers easy, convenient, and quick ways to return orders.
Those sellers who sell on Amazon know that the Amazon return policy is very lenient to customers who want to return items.
In fact, according to Statista, almost half of the customers return their online purchases.
Amazon announced at its Amazon Accelerate 2021 event the launch of two liquidation resale services that allow sellers to resell customer-returned items, such as Grade and Resell, a program that enables FBA sellers to relist returned or unsold inventory as used.
But what about the returned items that don’t get resold through Amazon? Usually, liquidated goods from Amazon are sold by pallet sale or truckload.
Learn more about Amazon Customer Returns here.
How Customer Returns Affect Amazon Sellers
Amazon’s returns come at no cost most of the time to the customers and are also prone to abuse and return fraud. The only exception is if the reasons for return aren't a result of an Amazon.com error, the cost of return shipping will be deducted from the refund. But in other cases, how exactly this policy affects sellers?
The expenses that come out of your account every time consumers return orders can end up having a high return rate which is terrible for account health and could even lead to account suspension.
Also, add the monetary loss generated by the return of a product. Read more on how to appeal an Amazon return here.
The Pros & Cons of Buying Amazon Return Pallets
Here’s a recap of the pros and cons of buying Amazon pallets for sale:
Pros of Buying Amazon Pallets for Sale
- You can use any Amazon Profit Calculator to evaluate if it’s worth it to sell certain products.
- You don’t need much storage.
- It doesn’t require a big investment.
- You don’t need technical skills, so it is a good way to start an ecommerce business.
- Cut out the middleman and maximize your profits.
Cons of Buying Amazon Pallets for Sale
- Some online liquidation companies won’t give you any description of what kind of products are inside the Amazon return pallets.
- You cannot grow or scale with this business model.
- Often, you’ll collect used items that you aren’t able to resell.
Final Thoughts: Are Amazon Return Pallets Worth It?
By flipping Amazon return pallets for cash, you can make a great amount of money. But it will depend on the time and knowledge you put into it to make it more profitable. For example, you want to make used merchandise as new as possible by refurbishing it in detail.
Although there aren’t many risks when choosing this business model, online arbitrage, and selling Amazon return pallets, it is true that you won’t scale to the next level. However, it can be a good way to start an ecommerce business.
Have you ever purchased an Amazon return pallet? How was your experience? Tell us in the comments section below!