Tom & Oksana Hill, owners of Midtown Bargains, know a thing or two about running a business. Between the two of them, they run a home staging business, two Airbnb rentals (plus RV rentals on Outdoorsy), and resell! Not to mention Tom is a licensed insurance agent and Oksana works for the state, all while running the online site for their resale business. They even find time to watch a few TikToks here and there.
The Hills’ reselling business, Midtown Bargains, was operating out of their home at first, but quickly grew into a 4,500 sqft warehouse and within five months, jumped to an 11,000 sqft warehouse operation. However, as with most businesses, even their success was challenged by the COVID-19 pandemic.
Shifting from a more local-based home decor and furniture pickup operation out of West Sacramento to online was no easy feat. And, brought its own set of challenges. As Tom said, “We shifted the way we did business and it cost a lot of work. We’re just smoothing that out now. Things were a lot easier, let me just put it that way.”
We chatted with Tom to hear more about their resale business, Midtown Bargains. In this edition of our Reseller Community Spotlight: Meet Tom & Oksana Hill!
The Beginnings of Midtown Bargains Q: When did you start? In 2016, we moved to Midtown and my wife had already been buying some stuff from a wholesale reseller. They kinda do what we do now but on a much larger scale. She was buying small items and reselling them on Facebook and Craigslist. But I got tired of people coming to my house, to be honest. Plus, when we got a lot of stuff our house looked like an episode of Hoarders.
In 2017 we ended up renting a 4,500 sqft warehouse and within five months we jumped into an 11,000 sqft warehouse. Same building, just a bigger unit because things were going a lot better than we had planned. It took a month and was right in the middle of summer. I will never move in the middle of summer again!
Photo of plaque on the outside of Tom & Oksa..
Everyone loves wandering down aisles and aisles of their favorite stores. Or perhaps the ease and comfort of online shopping. So many sizes, colors, and products to choose from! But have you ever wondered what happens to inventory that doesn’t sell in stores or online? Well, it’s commonly known as overstock inventory and it’s actually a big opportunity for resellers.
Overstock inventory is inventory that was not able to sell within an efficient amount of time at the retail locations. These items have never been purchased by a customer, and therefore, are not returns and should not be defective. However, this can be a headache for retailers. Just think, when the supply exceeds demand, what happens? Companies are faced with a loss. Whether this was the result of over-delivery or poor management of stock, it’s usually inevitable.
But the good news is products are then resold to a secondary market. This is where opportunity blossoms! We will go over where this inventory ends up, who can make use of it, and how B-Stock helps buyers get access to overstock inventory.
Where Does Overstock End Up? Categories like apparel, home & garden, furniture, electronics, health & beauty, toys & baby, and more can all be considered overstock. Inventory could be excess stock from shelves and/or warehouses or unused and recently discontinued. Retailers then offload this excess stock by liquidating it. Otherwise, it would collect dust in a warehouse space or end up in landfills.
We go into how B-Stock helps facilitate online auctions for major retailers’ overstock inventory in a bit.
Who Is Overstock Good For? Overstock inventory is great for businesses looking to bulk buy inventory for their brick-and-mortar locations or online reselling businesses. Mom and pop shop owners, flea market vendors, and wholesalers can also benefit from this inventory. Products classified as overstock should come in cartons that are factory sealed. Which is essentially brand new merchandise. Not only tha..
For retailers, warehouse space is at a premium. Every precious square foot can be used to house goods that will make you money or store out of season or customer returned inventory. Smart sellers understand that warehouse inventory that isn’t moving is wasteful and will drag the business down. And when it comes to large, bulky home goods inventory that isn’t selling and taking up too much space? That’s a problem.
If your business primarily deals with small items like cell phone accessories or jewelry, warehouse inventory management is a little easier. These products don’t take up too much space and offer a decent markup, so even if they’re not moving quickly enough, it may be okay to hang on to them for a while.
But if you sell large appliances, furniture, or other bulky home goods inventory items, quickly moving products through your warehouse becomes very important. Excess bulky stock does more than just take up space. It also makes it more difficult for you to access the products that are selling, slowing down the process.
Don’t think it’s a big deal? Read up on the woes of Loves Furniture, a furniture seller that filed for bankruptcy after only a year in business, largely due to warehousing and logistical failures. As a retailer, how do you avoid these warehouse problems while still maintaining a healthy inventory? Let’s start by looking at the types of home goods inventory that can really clog up your warehouse.
Bulk Home Goods Inventory Cute little boutique home goods shops that sell throw pillows, vases, and wall hangings are great. But if you’re really in the home furnishings business, you’re going to need a lot of inventory space. Home furnishings are some of the largest inventory items in retail. Here are some of the biggest home goods inventory items that may be clogging up your warehouse and slowing down logistics:
Furniture Just one sectional sofa can take up a lot of space alone. Having it in stock in several colors and configurations means you’re..
Owning a small business is no easy feat! And if you’ve made it this far, that’s something to celebrate. According to Investopedia, approximately 20% of new businesses fail during their first two years. If you’ve just recently joined the resale business industry, or have pivoted your business to focus on it more recently, then you made a good call.
In 2020, 120 million items were sold across the B-Stock recommerce platform. That’s a lot of business! You can have a successful resale business based on the concept of retail arbitrage—which is essentially purchasing products from a retailer at a lower price and reselling them for profit. So if you’re already started, or are just looking for some good industry tips, we’ve got you covered.
Tips for buying: 1. Look for trends & seasonality in the market There is a seasonality to certain product categories. A slower storm season may lead to an influx of customer returns on generators, after winter, you’re more likely to see overstock in coats, jackets, and warmer clothing. And then there are trends. Home & garden inventory isn’t subject to as many quickly changing trends because furniture and fixtures are pretty steady year-round. However, with electronics and apparel, between new releases and new trends, merchandise can depreciate fairly quickly
2. Renew your resale certificate In order to buy your inventory tax-free, you will need to provide a resale certificate. You submit one when you register to the B-Stock platform. What it really does is save you from paying taxes twice! You pass those savings on to your customers and are required to charge tax when an item sells. But did you know that you have to renew this certificate in certain states?
3. Track your auctions It can get confusing tracking all the auctions you’re interested in. Worse yet, get outbid because you didn’t see an auction was closing soon! Luckily, on B-Stock, you can add auctions to your “Watchlist” and also opt-in for SMS notifications on your accoun..
So you’re thinking about reselling and want to explore the consumer electronics category—that’s a good place to start! The demand is high for this inventory as it is part of most of our everyday lives. And the supply is definitely there if you know where to look.
Did you know roughly 20% of consumer electronics purchases are returned to the retailer or manufacturer? The two biggest reasons for these returns are complexity and lack of problem-solving. So essentially, the item is just too difficult to figure out how to use, or the product doesn’t solve the problem the customer was hoping it would.
Retailers take these customer returns and overstock inventory and then liquidate it. We go over what makes this category so worthwhile, different subcategories within Consumer Electronics (CE), and tips for reselling.
Why Resell Consumer Electronics? Reselling consumer electronics is a great business opportunity! Based on the concept of retail arbitrage, which is simply purchasing products from a retailer at a lower price and reselling it for profit. If done right, buyers-turned-merchants can sell the products at a much higher profit margin than the original discounted price.
So how do you get access to those returned consumer electronics? You head over to online auction sites and bid and buy on liquidation inventory! This inventory is deeply discounted and comes straight from retailers, conditions vary between brand new, like new, mixed, salvage, and refurbished. Always pay attention to the auction titles and manifest details. It will tell you whether the auction lot items are customer returns (dot com or in-store) or overstock inventory.
Consumer Electronics for the Home Consumer electronics for the home are skyrocketing. Especially for smart speakers and assistants. Roughly 1 in 4 adults in the U.S. owns a smart speaker for their home. And according to Amazon, electronics like the Echo Dot are among their best sellers.
Consumer electronics for the home include:
One year of a global pandemic later and reselling is still growing. For some, it’s a full-time job, and for others, it’s a part-time gig to supplement their income. There is a plethora of opportunity when it comes to reselling. But as is the case with all things, there will be ups and downs. For us at B-Stock, we wanted to know what those ups and downs were.
So, just how was the B-Stock community impacted by COVID-19? We asked 144 B-Stock buyers about changes to their operations and how they feel about the future of their reselling business. Here’s what we learned along the way.
Resellers are optimistic about the future growth of their businesses. Resellers benefited from three major sources of financial assistance. Reselling is a resilient career. Unlike other SMBs (small-medium sized businesses) like restaurants and boutiques, resellers were able to adapt. COVID-19’s Impact on B-Stock Buyers Since March 13, 2020 (when coronavirus was declared a national emergency), has your business requested financial assistance from any of the following sources? One-quarter of resellers didn’t receive any assistance at all.
However, for those who did, the top three sources of financial assistance were:
Paycheck Protection Program (PPP) – 47% Economic Injury Disaster Loans (EIDL) – 27% Small Business Administration (SBA) Loan Forgiveness – 20% How has COVID-19 permanently changed your business? B-Stock buyers did not have to make major overhauls to their operations. The biggest change for buyers was in their online/ eCommerce expansion. Over one-third of business owners took the opportunity to expand their online/ eCommerce presence — proving that adaptability is in their nature.
Nearly 57% of respondents said their business model “stayed the same” – that’s over half!
In your opinion, how much time do you think will pass before your business returns to its pre-pandemic level of operations? Almost 30% of survey respondents said it would take 6 months or less ..
When we engage with a customer to discuss how they deal with risk inventory (customer returns, excess, discontinued, etc.) we invariably end up in a conversation about our ability to deal with recovery, volume, and cycle time. Once clearance processes have lost their effectiveness, or the sheer volume of risk inventory is overwhelming sales and supply chain capacity, then a liquidation strategy is required in order to turn this product into cash. At that point every day this inventory remains unsold is a financial drain on the company, in terms of physical handling, carrying costs, warehouse space, and lost opportunity since those inventory dollars could be reinvested in better quality stock.
A technology partner can be critical to this success, one that is focused on recommerce and with strong connections to the secondary market. They can efficiently turn risk inventory into cash in days, not weeks, and help you stay focused on forward logistics and selling A-goods.
Cut cycle time processing customer returns Too often companies with significant return volumes focus on building an excellent reverse logistics operation that quickly credits the customer and accurately documents the returned inventory. Then they put the returned product in a big pile in the warehouse and work with a broker to negotiate a recovery price and take it away. The sale is typically a loosely managed event; not a scalable or efficient process.
By partnering with the right technology partner, returned product can be triaged into the correct disposition process and, where appropriate, immediately placed into a recommerce marketplace where it can be sold in a matter of days, significantly cutting down cycle time.
Things to consider in your reverse logistics cycle: Focus on net recovery Don’t invest any additional dollars into your reverse logistics process (e.g. repackaging, refurbishing, etc.) unless you can demonstrate that it drives additional recovery above the costs involved. Recovery da..
Resale apparel and footwear markets have exploded in the last few years, with consumers eager to snap up their favorite brands at lower prices while also reducing their carbon footprint by giving used items a new life.
Brands are taking notice at these booming secondary marketplaces–and want to cash in.
Several high-profile brands, including Nike and Lululemon, have recently announced “recommerce” (pre-owned item resale) plans. The brands are likely seeing the writing on the wall: the resale market is expected to grow five times over the next five years, according to a 2020 industry report from online resale marketplace ThredUp. In 2019, the resale marketplace grew 25x faster than the broader retail sector. By 2024, reworn clothing sales are expected to reach $64 billion, representing a huge opportunity for brands to recapture some revenue on the secondary market.
Click here to read the full Retail Leader article>>
The post Why Some Retailers Are Opening Secondary Resale Markets appeared first on B-Stock Solutions.
It’s a hustle as old as humankind: Get something on the cheap; persuade someone to take it off your hands for more. After the pandemic shut people in and wiped out jobs, the gig got supercharged.
One couple has sold $12,400 of Walmart instant soup mix since June. Another reseller is peddling boxes of 200 slightly wrinkled dresses for $800.
These freshly minted entrepreneurs managed to bootstrap their own businesses with little or no funding, often starting by selling common consumer products online from their homes and then expanding to warehouses.
“We’ve seen crazy growth,” said Marcus Shen, chief operating officer of B-Stock Solutions, which bills itself as the world’s largest business-to-business online marketplace for the unsold, the surplus, the returned and the liquidated. The Belmont, Calif., company has experienced a 34% increase in new resellers in the last year, he said.
Click to read the full Los Angeles Times article>>
The post Pandemic fueled a hot hustle: buying stuff cheap, reselling at a profit appeared first on B-Stock Solutions.
So you’re ready to become a reseller and make money from home online, great! Before you can begin bidding and buying on B-Stock, you must submit a resale certificate with a sales tax number. This is a mandatory step in our application process. It shows that you are a business and intend to resell the items you purchase, but it also does more.
Why do you need a resale certificate? The purpose of having a resale certificate is to allow you to buy goods through your business without paying local sales tax at the time of purchase. It’s then your responsibility to collect the tax from your customer when you sell the item. It benefits your business by allowing you to avoid sales tax and pass those savings on to your customer. It can also allow you to buy more merchandise to grow your business.
What’s on this certificate? A resale certificate can be called different names depending on which form you use or which state your business is registered. Additional names for resale certificates include a reseller’s certificate, reseller’s license, resale license, or a sales tax exemption certificate. So check to see if you may have one of these already.
A resale certificate typically states the name and address of you – the buyer-, your sales tax number, seller information (which we request you leave blank due to the number of different retailers on our Sourcing Network), a description of the items being purchased, and a statement that the inventory is being purchased for resale.
So, where can I get one? It is your responsibility as the buyer to do your due diligence and comply with federal and state laws. We recommend visiting your individual state’s Department of Revenue website to learn more about resale certificates. They will be able to provide you with instructions on how to acquire a sales tax number in your area.
Please visit this link to find out which form B-Stock accepts for your state.
Other helpful sites we like are TaxJar for an individual state sales tax gui..