Guest post by Ryan Kampff, RK Sales & Consulting
Pallet wholesaling is on fire with many new businesses springing up and I am finding that there is a rush to find the $4-5k un-manifested trucks with “nice looking” pallets. Though I have access to some of these lower price loads for about the same price as others, many of my offers are well above that price range and offer added value such as having been graded and or manifested. The rub is when the conversation with a new pallet wholesaler, more often than not, seems to circle back to “How much per pallet and how many pallets?” At that point, it is pretty hard to compare a $200 pallet to a $1200 pallet, because the pallet wholesaler, understandably, is a slave to the mindset of their customer who walks in to view pallets simply marked $300, $400, $500, etc. and chooses solely on the visual appeal of the boxes they can see.
By contrast, when selling directly to a retailer in full loads it is often very different. There are some who are fairly new and doing pretty well with the lower priced trucks but suffer occasional setbacks with some loads which seem to put their business into crisis mode and their purchasing on hold. While I tip my hat to anyone who is running a retail store, I see the ones which have been around for many years regularly spending $10k, $20k per load and above and I think it’s because they have the experience, in terms of years, to have attached real concrete numbers to labor of sorting, waste factor, warehousing, recycling and trash services, etc. and have come to the conclusion that they are ahead in spending the money up front and removing the risk and some of those costs. The retailers who have been around for decades and continue to buy the lower price loads usually have a massive back-end operation and are processing so much volume that they can absorb a bad load in the law of averages.
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Pallet buyers are not unlike larger retailers who buy full loads, though the majority have less experience and finances to absorb a mistake. I think there is great opportunity for pallet wholesalers to buy more expensive trucks which have been proven in the marketplace and still make a decent profit selling pallets, but there is an education process for them to be able to convey the value. Sure, the profit margin will be lower for the pallet wholesaler, and for the pallet buyer there are less of those “jackpot” stories of that one pallet that had all those high-buck shelf pulls buried in it, but there is steady money and predictability which translates to being known for a consistent level of quality –repeat business. The bottom line is; when you have an itemized manifest, you need to shift gears in your thinking from “per pallet” to the quality of manifest, type of retailer, and the actual products which actually will be (not “may be”) on the load, and pallet wholesalers who start educating their pallet buyers will have far more product available to sell.
www.rksalesandconsulting.com is your well-connected source of customer returns, overstock, and shelf pulls direct from major retailers and manufacturers. We are also proud to bring you manifested Fingerhut loads direct from the source. We supply products for online sellers, bargain outlets, exporters, flea market sellers and more! Contact Ryan Kampff at 763-268-9939