LIQ202

Southern American Marketing, Inc.

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The most read & well known Global manual to date on the subject of merchandise liquidation.

SAM

Presents,

"The Original & Most Comprehensive, Informative liquidation guide offered in America today"

America

"Returns to Profit"

Absolutely free! Our gift to you, keep your credit card in your wallet.

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Are you new to the salvage & surplus industry, but can't seem to get any help?

Are you sick and tired of the entire typical liquidator HYPE and BULL?

Most Liquidators refuse to divulge their secrets from fear of competition.

When you sincerely ask, do you get that deer look?

They keep the secrets so contained; you need be a detective sleuth to uncover the mystery.

The secret liquidation merchandise private eye, Sherlock SAM

Not any more.

All of the secrets of salvage & surplus distressed merchandise will be revealed to you in the following on-line manual, absolutely free of charge.

This manual is free!

Some may call me dumb.

I like to think of it as, dumb as a fox.

Silly SAM, the Salvage Fox

This online help manual has been produced absolutely free of charge and it is solely intended to help those entrepreneur's who have always held a fascination for this business but could not find any help. I saw one such offer over the years for only $79.99. The publisher then sent a stapled together booklet of notebook paper, which read, buy from Xco on every page and it gave you only Xco's phone number. $79.99? You could have found this information in any yellow pages, free.

Please feel free to download or print this information and use it to develop your own knowledge in this amazing and lucrative field.

The subject matter contained in this help guide will be related to distressed merchandise from major department stores, catalog companies, manufacturers, retailer's and wholesaler’s; and will cover the subject of overstocks, shelf-pulls, closeouts, seconds, less than perfects, buybacks, vendor returns, irregulars and many other types of distressed merchandise. And most importantly how to obtain merchandise for pennies of the actual dollar value.

Contents

· What is distressed merchandise?

· What do liquidator's do?

· How do I get involved with buying & selling distressed merchandise?

· Where can I sell distressed merchandise?

· How do I plan?

· How do I determine if I am getting a good deal?

· Who pays for freight?

· Customer Comments

Who & Why:

I traveled the world for roughly 20 or so years in the petroleum industry. In between days on and days off (28 on & 28 off) I was usually bored silly by the second or third day at home. I pursued other interest, mostly in sales. I found I enjoyed low pressure, people needs, oriented sales. After several business ventures, which went under for one reason or the other, and the petroleum business, shifting to the middle eastern oil companies, I decided to find something that I could honestly enjoy.

I finally came into this wonderful fulfilling business, and have been excited every since. Debbie and Matt our son, who is still young enough to live at home, we now enjoy a fun, moral and rewarding liquidation & wholesale company.

In the following be assured you will get your money's worth, it's free!

There is not a day that goes by that we get bored. We meet all kinds of colorful people from all walks of life and from around the world and many are our good friends.

We have many competitors who have been a boom to SAM'S business and would like to thank them all. We would especially like to thank Harold Hood, Charles Long, and Jean & Chuck at World Wide.

We hope, that in your new endeavor of Salvage and surplus liquidation, you succeed with the same enjoyment, enthusiasm and financial rewards. When you do business with SAM, we assure you that you will not be "taken for granted" while in our care.

Please call us toll free @ (800) 261-9150, we will sincerely, give freely, as much information as you need to get started in this fantastic field.

We don't intend to gain a literary award for this help booklet, but maybe we'll be nominated for the good Samaritan award, because of the time that it took to prepare the information, and then only to offer it to you, absolutely free, for your personal benefit.

We considered selling this information, but we decided that the gift of our experience would make all of the difference for the many thousands of good people who are seeking honest, knowledgeable, reliable & absolutely free help, no matter, whether you buy from SAM or from a competitor.

We feel 6.2 billion people could possibly view this information.

WOW! 6.2 billion X $39.95 if we sold this valuable info, look out Bill Gates. $ 247 billion dollars. But it's absolutely free to you from SAM.

Of course there are "How to" manuals for sale, on the market today. This free gift of liquidation information has been a main ingredient to the cautious growth success of SAM.

We welcome you to our warehouse located in Bay Minette, Alabama. We are just simple country folks and we are kind of similar to hotel six, We'll leave our lights on for ya. And if you insist our shoes too. (Pun intended)

Thank You,

Robert Pickle

Southern American Marketing, Inc.

What is distressed merchandise?

Regardless of the condition of the economy, people across the United States and around the world are constantly searching for bargain deals. Thousands are laid off by scheming corporations monthly.

It doesn't matter whether they are a housewife struggling to make ends meet for their families, an independent retail operation , wholesale operation, a mega discount retailer or a wealthy individual, a good deal is always sought after.

This is where SAM comes in as a professional liquidator.

Almost any merchandise imaginable can become distressed for one reason or the other. At one time or another, merchandise such as, but not limited to;

o Automobiles	o Clothing
o Automobile parts	o Household
o Bedding	o Health & beauty aids
o Building materials	o Food
o Carpet	o Computers
o Electronics	o Sporting goods
o Domestics	o Commodities
o Gifts	o Exercise equipment
o Toys	o Appliances
o Kitchenware	o Luggage
o Baby Products	o Industrial
o Books	o Military products
o Lighting	o Dollar store merchandise
o Furniture	o Shoes
o Tools	o Pet products
o Patio	o Office supplies
o And many more	o Paint

Southern American Marketing, Inc. (SAM) specializes mostly in customer returns from major department stores and customer returns from major and well-known catalog companies. SAM also offers new first quality closeouts & overstock merchandise as well.

Customer returns are the most lucrative and plentiful because of the growth of the national mega giant discount retailers, catalog companies and wholesale clubs and the amount of customer returned merchandise.

It is becoming more common to pick up a daily newspaper in almost any small town or major city and see, W-Mart. Putting small retailers out of business. Now you can finally compete with Wally World, by offering the very same general merchandise at prices far below their normal retail prices.

Customer returns are usually the best opportunities as, the merchandise has already been purchased once, so someone wanted or needed it.

To my best estimate, 70% of all general merchandise has been returned for various reasons such as; mom did not like the color, junior did not like the way it sounded or dad already has one, and many other reasons.

Often a dissatisfied customer will return the unwanted merchandise to the giant retailer, with the good intention to swap the product with other merchandise, that usually has equal or greater value, only to be met at the service counter by a low paid clerk, with a bad hair day attitude. After the customer waits an unendurably long time on the usually slow & unpleasant clerk, and then is confronted with the bad attitude of that service clerk, by this time the customer may be in a hurry to continue the rest of his or her daily activity and in frustration, usually will simply say, I want my money back, this item is broken, and then may rush out the door to another more courteouis retailer.

Of course the major retailer is not in the repackaging business for customer returned merchandise, and even if so, who would want to purchase an item with the package damaged & pre-opened, when there may be 10 of the same item on the store shelves that are un-opened & new ?

It is much more, economically feasible for the retailer to send the merchandise to the back warehouse, to be put onto a pallet with hundreds of other different merchandise items. These pallets are then sent to the retailers central, customer returns center (CRC). These CRC'S usually double as the retailer's distribution center.

The retailer will then write the merchandise off as a loss and continue doing what they do best, and that is mega retail, at discount prices in their store locations.

Most major department store & Catalog Company CRC's are located in the eastern United States with few exceptions, few in the mid west & western United States.

Keep in mind, that some of the largest super centers may turn over $ 5 million dollars of merchandise per week. If a certain product is taking up shelf space, but is not moving as fast as the retailer would like it to, they may pull it from the shelf. If it were to stay on the shelf, it may cost the major retail operation thousands of dollars in lost profits per year. They will pull it from the shelves and send it to the CRC along with customer returns. This of course is an added plus for the liquidator and their customer, as the products are new. This is called shelf-pulls. The retailer may also have case lots of obsolete inventory or an overabundance of a certain item. The corporate office may authorize to send it along with the other distressed merchandise to the CRC to be scanned and calculate corporate losses. This merchandise is referred to as overstocks.

Closeouts are usually merchandise items that have been depleted to a certain level and are then not profitable enough, for the lack of volume to advertise and or tie up massive man-hours in labor to promote the merchandise. It may also be merchandise, which has lost its zeal and is replaced with a newer line or a different type of merchandise.

Once this merchandise has been sent to the CRC other pallets sent from other stores meet it, and it accumulates rapidly. For example: let's say the retailer has 5000 stores nationally and each store produces 1/2 pallet of goods per day. That would add up to 2500 pallets per day. Multiply this retailer with over 100 major retailers and then you have an industry within an industry, producing millions of dollars of distressed merchandise, called salvaged products. This merchandise is not discarded because it can be re-sold.

Catalog companies are usually a little different in the condition of merchandise returned as, a customer may have purchased an item from a catalog, only to receive the merchandise and find that the item does not look like it did in the catalog. They simply return the merchandise. Usually reputable quality merchandise from a catalog company can be extremely lucrative if the percentages of cost are reasonable.

Less than perfect, seconds and irregular merchandise usually come direct from the manufacturer. Due to the less than perfect nature of this merchandise which has been through a quality control process, this merchandise is deemed as Salvageable and is sold at mere pennies of the actual manufacturing cost. In many instances the merchandise may to appear normal, but upon close visual inspection you may find irregularities. This merchandise usually, is highly resalable & profitable.

Most discount chains across the United States have built successful retail organizations using the above-mentioned distressed merchandise.

There are difference's in quality in merchandise loads that come from major retailers and catalog companies, who enjoy good reputations, and companies who have bad merchandise loads usually have bad quality combined with an excess of actual thro-away.

And just as well as differences between a liquidation broker company who sells merchandise just for the sake of moving it and the reputable liquidator who is stable, straightforward and owns their merchandise. And many times the liquidator may be under a light contract with the direct supplier.

Don't be fooled by all of the HYPE & BULL advertising many liquidation companies use that proclaim that they are the direct source.

You too, could purchase from these CRC'S, but you need to be prepared to take as many as 500 loads of merchandise per year. Usually the amount of the loads is so numerous that one liquidator cannot possibly handle it all. And if you continue to search you will usually find a reputable liquidator that will sell you the same merchandise at much lower cost. Any major retailer will usually diversify liquidators as added protection, so they will not be left with tens of loads of merchandise in the event that one liquidation company falls out of the program for some reason or the other. They will have several liquidators to depend upon to keep the merchandise moving fluidly and away from their distribution process.

SAM offers many diversified loads of general merchandise to individual companies who may want to wholesale at reasonably reduced prices, or may warehouse and sell pallets in their geographical areas. Of course this reduces profit margins, but SAM operates on the volume philosophy. Of course the more merchandise that SAM moves for the large companies, the more we create strong credibility for SAM.

Be cautious of liquidator’s who also operate one or more retail stores, auctions or on premises event sales. If they compete with you the greedy temptation to cherry pick the good merchandise could be a powerful evil. There are many who will take the good merchandise from the pallets to put into their own operations, thus leaving you with the less than desirable merchandise.

This is not always the case. Be cautious.

Some, liquidators could be greedy, money glutton, morally unethical, cherry pickers.

Greed is a powerful deterrent to honesty. Sometimes the liquidator's thinking may be: why sell it to the retail operator and only make 10% when they can sell to the public and make 200% to 500% profit. And it may not stop there, the liquidator may begin noticing other valuable merchandise that is on pallets or full loads, which would otherwise be sold and shipped to you, the wholesale customer. They may believe this merchandise could be much more profitable in their own store, (s) and deliberately take the merchandise for their own store, auction, or spectacular event. This is called cherry picking the merchandise. Be careful of cherry picking.

The Cherry Picking Pie

SAM does own 1 retail store. This store is operated solely for the purpose to support a family whose father is disabled and has no income. In order to insure that this family makes an honest living, they MUST purchase exactly as every one else does. This returns store IS NOT profitable to SAM. Without this needy family, SAM would not be in retail whatsoever. We are too busy, as it is.

Sam does not auction or have on premises spectaculars. We totally concentrate 100% of our effort in providing good quality & profitable merchandise just for your needs.

We have a strong written company policy regarding anyone taking merchandise from the warehouse premises without proper authorization. And no one is ever allowed to pull merchandise from pallets.

We do build custom made pallets for customers who do not desire clothing.

Southern American Marketing, Inc. has learned from years of first hand experience which major merchandise loads have good reputations and which have bad reputations, and which are just plain terrible merchandise loads. We have elected to stay away from those less than desirable merchandise loads, whereas some other liquidation companies might move merchandise just for the sake of making profit. We know of tens of retail salvage merchandise loads that are being sold by liquidators for several thousand dollars a load that we would not personally give several hundred dollars for.

Then there are those liquidators who have the philosophy of profit verses volume. These liquidators prefer to sell one or two loads to a new unsuspecting customer at hundreds and sometimes thousands of dollars over their cost. There is absolutely nothing wrong with good profits. But when good profits come at the expense of the unsuspecting end buyer of the experiment, it is certainly immoral.

If you lose, SAM loses.

SAM has determined that even though we could have sold strictly for profit verses selling by volume, that selling by profit, sooner or later we would run out of people to sell to. It may take 50 years, 25 years or 10 years, but sooner or later we would run out of people to sell to.

At SAM we keep our overhead low and pass the saving's on to you. And that is the entire "how to" that you may ever need to learn. As long as you receive the right merchandise with good quality, work long exhaustible hours, do without lunch daily and are in a good area, we can almost guarantee you will be successful. If you follow the law of nature, we assure you that your company will grow. You will only reap what you sow.

Volume is by far the best means of retaining long-term loyal customers across the country and abroad. Selling honorably this way we don't need to have a long memory. Remember if you tell your customers lies, you may as well tattoo them across your forehead, so that you can remember them each morning when you look at your self in the mirror. That customer may call again.

What is a pallet? What does a typical pallet of distressed merchandise look like?

Sam ships into our warehouse many different type loads of distressed general merchandise, overstocks, closeouts, customer returns, etc. When a full load of merchandise comes into the warehouse, the load will either be a manifested load or bulk loads.

The load in bulk only manifests some loads by the individual item, while other loads are processed & manifested by the pallet.

If the load is manifested by the pallet, when you purchase that pallet you will know exactly what items will be on that pallet. A typical full load of merchandise usually has between 22 to 24 pallets of merchandise. This is an average 48-foot semi tractor-trailer load. There are 53-foot tractor-trailers also and they will usually hold 26 pallets of merchandise single stacked. On a manifested pallet you will pay the percentage of either wholesale cost or a percentage of the actual retail cost, depending on how SAM purchased the load. If the pallets came from a bulk load, which has 24 pallets, we will usually calculate how much the full load cost and divide that number by 24. We will then add the freight and divide that number by 24. We will calculate labor and divide that by the cost per 24 pallets, add all of these figures together and add an additional 10% profit. This formula will price the pallets to where you will also be able to make a profit. By the time freight and load cost as well as our profit margin are added together you will usually have 15% of the original non-manifested retail value invested into the pallet. If you are having the pallet shipped to you, you will also have to calculate the freight cost per pallet and divide that number by the number of pallets.

Many customers will not order just one pallet at a time, as the profit margin will not be as much, whereas if you ordered five pallets. Your freight would be greatly reduced, thus your profit margin considerably higher.

The average pallet prices depend mostly upon the merchandise type, size, bulk & weight of the merchandise. Every pallet will be different.

Following are typical pallet pictures from several bulk loads of merchandise. We have not buttered these pictures up, to falsely mislead you. This is exactly how they arrive into the SAM warehouse.

A typical Target pallet, usually 6'

Tall, Bulk load. Not Manifested. A long time repeat load for hundreds of retailers across the US. Lots of new shelf-pulls.

Average $350.00- $400.00

A typical TGT dept. store pallet. Average cost $ 350.00- $450.00

Average cost typically around .10-.15 cents to the actual dollar, a favorite money making load.

When a liquidator refers to purchasing by the pallet, this means that you can buy individual pallets of merchandise from the warehouse like these above.

Multiply this pallet by the normal 24 and you now know what a full load will look like on average.

Two typical manifested pallets. Note the manifest attached to the top right of the pallet. This manifest list individual units on the pallet as well as the catalog company's wholesale cost. You will pay a percentage of the actual catalog company wholesale for each pallet.

There are also loads that are what we refer as top loaded loads. This means that the loads are usually top to bottom- wall-to-wall & front to back of an average 48' semi tractor-trailer. These are usually sold at a set bulk price.

Average Target Load, 24 pallets Bulk

Target Your Market Today!

What do liquidators do?

Liquidators are primarily the middleman for the mega retail chains, manufacturers and the catalog companies for their distressed merchandise. Please keep in mind that the difference between a broker and an actual liquidator, is, the real liquidator will either have a contract or prepays for merchandise before he markets it to you, at pennies of the actual dollar value. The liquidator usually has instant access to the loads they offer. While the broker may tell you he doesn't know and that he will have to call the corporate office to the 73rd floor and check with the head boss, to see if the load has been sold. This is called the

"Broker Razzel Dazzle Baffle Buffle Shuffle."

Contrary to what you may read in current closeout publications, a liquidator is not the Direct Source. If you believe this, I've got some ocean front property...

If a liquidator was the direct source why would you shop at major retail centers or catalog companies? You could just take the family to the local liquidator for your merchandise needs. To be factual, after you read this on-line help booklet, you could also go direct. Of course you need more education on the subject and plenty of financial backing, but who knows SAM may buy a deal from you someday. SAM never boast to be the direct source, we are humble enough to know that your legs can be knocked out from under you at any time. What we depend upon is the thousands of hours of hard knocks we have been through and the contacts we have made after many years in this business. We have made all of the buying mistakes and are simply attempting to let you know what these mistakes are. Don't be deceived into believing these claims. Believe those who are humble and helpful. It doesn't matter who the liquidator is, if they take the time to inform you of all variables in this industry, chances are they will be a good company to do business with. And we highly recommend that you sincerely treat your customer the same humble way.

SAM has been through many humbling experiences.

A broker is someone who depends upon the liquidator and the supplier to move merchandise he has never been a witness to and collects his commission off the top of the deal, all the while never actually knowing or seeing the quality of the merchandise. He is usually the third or fourth party involved in your transaction, which may cost you additional hundreds of dollars. Ask if you can go directly to his company warehouse. If he does not have a warehouse in which to store merchandise, then you have got him pegged as a broker.

The Direct Source is the actual retail giant distribution center or otherwise.

It is not wise in many cases to deal with a broker. Usually the broker has not viewed the merchandise and therefore cannot truthfully represent the condition of the merchandise to you accurately.

Many times the brokers only concern may be, how much money he will make on a particular deal. Do the deal, and then hide from you.

His concern for you is about as far from his interest as Little Rabbit, Australia is from Bay Minette, AL. And when you have been shipped your load, which was totally different from the representation made, about all he can do if he has any honesty at all, is to offer you his profit that he has made on the load. It stands to reason, he can do nothing more as he is not invested into your load. All he has done is to sell you a load of merchandise he has not ever been a witness to, wait on your wire transfer, well above the liquidated price of the load. When he receives your transfer, he then will also make a wire transfer to the liquidator for a lesser amount, he will collect his funds from the top of the deal, all the while never actually seeing or touching your merchandise.

However there are some brokers who make the exception to this rule. We know who they are. Some are honest and reputable.

On the other hand a reputable liquidator, which has control over the merchandise, he or she sells will usually be able to correct a legitimate problem by dealing with the mega retail supply source. But of course there will be a rigorous investigation before this usually happens. The liquidator will never correct a problem a broker has created; therefore as stated above, the only correction a broker can make is his profit.

Always be careful when the liquidator boast, such as," We are the Direct Source", "We are the Contracted Supplier". Blah, Blah, Blah..............

Even though some may have a limited contract for a specific merchandise load, they are by no means the Direct Source. If they were the direct source, why would you need a liquidator? Already you have encountered

Less than Honest

They may take your money and run

SAM has the philosophy that it is much wiser to stay small to a degree and it is wise for you to deal with a small company for the very reason that a small company has no other choice but to do what is right for their customers. Service is an absolute must. SAM does not have the luxury to take risk for unknown merchandise deals and then pass them on, uncaringly to unsuspected customers. SAM has to make every penny count. We have to guarantee that we have purchased good loads because we are not in the position to lose our many good customers by frivolously buying these less than desirable loads and then passing them off to you, even when they are bad deals.

We have witnessed firsthand the mistake other liquidators have made by contracting with mega retailers for hundreds of loads per year. Because they sell the merchandise loads at astronomical profit, They are so afraid of losing the contracted loads that they will not be capable of diverse merchandise deals and do not offer the diversity that retail operators need in their supply of merchandise availability. So you may get loads that are profitable to the liquidator, but what about your store or locations, profit?

Keep in mind, that if you decide to go into a retail operation, that if you buy a particular department store load repeatedly and do not experiment with other desirable department store loads, you may saturate your market and began to lose customers who have grown tired of the same old merchandise. You need the variety to keep your customers excited about coming back to your store. This is a mistake often made by the small discount center.

SAMMY- The Pig In A Polka

We are free to have that diversity, we offer merchandise from 15 to 18 sources of retailers and catalog companies. We stick with the loads that are good for our customers and have been tried and true.

Even though SAM has several so-called direct contracts with as many companies, we have found that not always are contracts the best approach. And of course these contracts are not legal system tight. You can usually wrestle a contract from a so-called Direct Source, by offering a better return to the mega source's management. (More money)

But be careful before you attempt to do this. You may be paying 10% for a particular load or loads of merchandise to the liquidator, and usually when an individual company attempt's to go around the liquidator for a contract, the major retail manager may began to think that their merchandise is worth much more because of the sudden interest. He may decide to sell to you or he may flatly tell you that they have a contract with SAM and you will need to call SAM. Then, the major retailer may call SAM and report that the merchandise loads have went up by 2% because of sudden demand. SAM may either tell them we no longer want the merchandise or pay the 2% more, and then pass that 2% on to you. If your average load has $100,000.00 in retail then you just cost your company an additional $2,000.00 for the same merchandise load before tampering with the retailer's CRC management. Before you attempt to go around a contract be prepared to put your money where your mouth is. Remember the negotiation requires many variables that you may not have thought about.

Another example; SAM may have a contract in place with a set percentage price. If the supplier has an over abundance for any reason, we are forced by contract to take the merchandise as agreed to the set percentages, no matter the amount of volume.

This may call for additional warehousing at certain times and seasons. Warehousing could put us out of business unless of course we have plenty of money to sit on the merchandise for a slower period to arrive, or simply move the merchandise at cost.

On the other hand, for example, lets just say we are paying 10% of retail for a certain contract load and our contract comes up for the next year. SAM could decide that we don't want the contract for another year. Other liquidators may be afraid to take these loads, as they have not developed a market for them. The supplier may call and offer a renewed contract at a substantial decrease in percentages, saving the final independent retailer (you) thousands of dollars, for that very same merchandise which you had been purchasing for years at a higher rate from SAM, if we were contracted.

This check and balance system is what keeps the Surplus merchandise industry at profitable levels. I have heard it said many times by certain liquidators, that the best way to profit is to curb the market, own it all. Of course this drives the prices to high to be marginal for you, the end buyer/seller. Usually this tactic does not work and will eventually backfire upon the liquidator.

SAM may not hold certain contracts because we have found demand for the merchandise loads which have good reputations far outweigh the profits which can be derived for a sizeable contract with one supplier who has less end seller, demanded merchandise loads. Freedom of diversity is an important asset for SAM & Your Company.

SAM has decided not to broker merchandise loads, site unseen. We usually buy what we sell, first and we are well acquainted with the results of prior loads. We usually always bring as many loads to our warehouse as possible to determine the value to your operation. We put ourselves in your shoes before we make final buying decisions.

Be careful do not Assume

Over the years we have witnessed such as; A customer who has a retail operation may be adamant about purchasing a particular load of merchandise, explaining that they do tremendously well with that particular load. A competitor 10 miles down the road may call SAM and demand that same load of merchandise, because they have witnessed the first store doing well with that merchandise. SAM may advise that customer against that particular load. But that customer definitely wants that load. Several days later he may call SAM angry and complaining about that load of merchandise and how he may not make any money from the sale of the merchandise. Please consider this, allow SAM the opportunity to know all of your location variables, geographical location, economy, competition, size of the store, frontage traffic, etc. We will then make every effort to advise you from our many years of experience, the best load for you to begin your operation with. Just because the merchandise seems to be selling like hot cakes down the road, does not mean your clientele will be the same type of buyers. And what may occur is that the competitor may be able to sell far below you for reasons such as lower, unseen overhead or many other variables.

You will find, just like in any industry there are good companies and bad companies, good and reputable liquidators and bad liquidators with terrible reputations. This business, even though global, is really a tight niche business and word of mouth spreads rapidly, both good and bad. It does not take long to find who the bad liquidators are, however by the time you know who they are, you could be out of business from misrepresented, bad merchandise loads. Then there are those who will tell you every company is a bad company, beware of these too. The only way that they have found to look good is to make everyone else look bad. There are many ethical liquidation companies available. These are just like you, they are trying to provide for their families and have put up thousands of dollars of capital. They usually have the highest risk.

Bad Guy The Good Guy "SAM"

Generally merchandise liquidators are usually contacted by the source's management; or the liquidator may make the contact the large retailers, manufacturers, wholesalers and catalog companies, and offer to take their unwanted, overstocks, shelf-pulls, buy backs, vendor returns, irregulars, seconds, less than perfects, insurance salvage and other distressed merchandise. This requires considerable resources such as finances, time and a huge amount of negotiating experience.

Usually, merchandise which holds a good reputation are the merchandise loads or lots, that do not have over a 15% to 20% actual throwaway or damaged merchandise margins, Or otherwise, actually damaged merchandise which was returned because of some slight damages.

There are many retailers; catalog companies & manufacturers that meet the standards of good merchandise loads. Then there are those companies that will use 48' semi tractor-trailers as dumpsters and pass full loads of garbage off to you, the un-suspecting buyer. It then does not matter how much of a percentage you pay, garbage is garbage, I pay my garbage collector to haul my garbage to the local landfills and we expect them to do the same. Garbage and surplus merchandise have nothing in common. For SAM, garbage does not need a price. If a trailer cost you only $1,500.00 but it is garbage, you have been overcharged, you can go to any dumpster behind any mega retailer's store and get the same merchandise absolutely free. Be aware of those offers of $ 1,500.00 - $3,500.00 for a load of merchandise. Doesn't this seem to good to be true? It usually is, be cautious.

For highly resalable surplus merchandise you will usually pay between 15% to 25% of retail or 15%- 55% wholesale, but there are exceptions to this rule, only occasionally. The average load of good reliable resalable merchandise will usually cost you between $6,500.00 up to $25,000.00.

BOO!

It is definitely not the intention of SAM to scare you away from the surplus business, but the intention to educate you and save you thousands of dollars, which could end up as monstrous losses to you. We intend to help you until you are experienced, knowledgeable, and profitable and don't always have to watching out for the boogey man.

We do not want your business if you do not understand this industry.

However we do want you to have this information so that we both may make the right decisions based upon your area, the economy the type of merchandise that will do well in your market and many other variables. Then SAM will be assured that you should be profitable and we can retain your business. We intend to eliminate any mis-understanding from the start, not sneak up on your inexperience.

For example: SAM offers merchandise, which does wonderfully, well for small retail operations, but would not do well at all in a general public auction. In an auction you may want larger ticket items that will move rapidly, not small retail items that will take up considerable time, just to make a few dollars.

Auctions need to maximize the excessive advertising requirements for the one night-er; therefore you may not want to sell trinkets. You time will be limited and it will take many trinkets to pay off. Unless you intend to hold dealers auctions. Many Auctioneers understand the difference of requirement between a dealer’s auction and a general public auction. You may want to consult with a good general auctioneer in your area to consider the best opportunities available. Many states require that auctioneers hold that states license. Be certain to get a reputable auctioneer.

There are loads of merchandise, which are good retail store filler merchandise, but definitely would not be good for an auction, etc.

There are many different type retail, auction and wholesale scenarios that we will need to discuss with you so that we may help you pinpoint the specific type of merchandise, which will help you, become profitable as soon as possible.

SAM has experienced many various merchandise loads and through years of experience we are familiar with almost every retailer & catalog company in America. As we said earlier we have elected to shut our doors and go home, before we sell bad merchandise loads to our valued customer. There is and never will be the intention of SAM to simply just sell anything available. But keep in mind, that in the surplus business, you take the bad with the good. It is a calculated risk. But for the most part it is a profitable calculated risk.

However we are not going to burn any bridges with certain suppliers because of a bad load or two. We have found that when merchandise begins to pile up in their CRC they will usually sell the merchandise at reduced prices that any one can make money on. And as the merchandise begins to stack up at their facilities, they began to realize that something must be wrong. Then they began taking corrective measures to solve the problem of undesirable loads, after they have reduced the cost of the merchandise to SAM.

But until that happens at their management level we will stay away from their merchandise.

Sam will usually negotiate the price that we pay for merchandise, from 5% of retail to 20% of retail, depending upon the condition and the newness of the merchandise offer. Usually no more than 35% of wholesale cost. Higher, depending again upon the condition, demand, quantity and quality of the merchandise. We have paid as high as 50% for new & factory refurbished merchandise, which has high demand.

Always remember, that the selling of merchandise, as much as by the price that you purchase the merchandise for, does not usually make the profits. You should make your profits on the buying end and sell below the major retailer in your area. Make your profit up front. Buy low, sell high, and reap profit on both ends. It is no small wonder why the small town retailer cannot compete because Wally World thoroughly understands this principle and has built thousands of stores across America.

The retailer giant's CRC management would rather deal with liquidators than the end retail buyer for logistical simplicity, and time. That is why you need SAM.

SAM usually buy's merchandise loads in multi trailer purchases, while the average retailer can usually buy in limited quantities.

SAM take's all of the risk and the overhead cost which are involved in buying by the multi trailer load quantity. Many times we are forced to warehouse hundreds of thousands of dollars of merchandise and at such times; as after major holidays, etc. when returns are over abundant but the retail season has slowed down somewhat.

It is not always wise to buy merchandise that you particularly like for yourself. It may be a flop for your customers. Stick with what the honest & reliable merchandise liquidator recommends.

"Serve the Kings and live like the masses.

Serve the masses and live like a king."

The Retail King

At SAM we concentrate on markets such as retailers, wholesalers, jobbers, auctioneers, flea marketers, pawn shops, outlet centers, gift & boutique stores, clothing retailers, shoe stores, furniture stores, building suppliers and many others. These are usually the most profitable merchandise end sellers for selling SAM'S distressed merchandise. They no longer have to compete with such giants as Wally World, at conventional wholesale prices, but they can develop a market unto their own.

Because many of the smaller retailers are forced to compete with Wally World and other K store giants, they have found that by offering distressed merchandise, they can compete and purchase at discounted prices, even below the mega chains wholesale cost, and they can usually compete in the discount giant's very own geographical area, with the very same type of merchandise which the giant offers, and at prices well below the giant's retail. And they pass these savings on to the frugal buyer.

How else could you possibly compete in today's market? The day of the small town proprietor is just about over for conventional retailing.

One of SAM'S largest customers has over 20 stores with 60,000 sq. ft. per store on average, and they boast millions of dollars in sales in several states, while offering customer returns, overstocks, closeouts, etc. And they have managed to keep their merchandise purchasing a secret from the general population.

There are normally several different ways to purchase distressed merchandise. These are by the percentages of the actual manifested retail, percentage of the manifested wholesale and a percentage of the company's actual bulk cost.

Usually the rule of thumb dictates that a mega large company can buy at below the regular manufacturer wholesale. This is called their

"Company cost".

Or you can buy at a percentage of manufacturers wholesale, which is usually what the smaller chains purchase for, because they may not have the buying power the national mega chain has. This is percentage of the manifested wholesale.

Or you can purchase at a percentage of their actual suggested retail price. Likewise, percentage of net retail.

And, or you can purchase by bulk.

Rule of thumb dictates that if Wally World buys at wholesale cost, and they purchase an entertainment center from the manufacturer for $100.00 then they will usually sell that center in their retail for 100% mark-up or $200.00.

Example: if they buy the entertainment center for $100.00 and they liquidate it, manifested @ 25% of cost to SAM, then you will of course pay $25.00 for the very same unit that they pay $100.00 for. Giving you a mark-up margin of $175.00. They will simply write it off as a business loss. The only problem with that entertainment center may be, that the little old lady saw one similar to it set up in the showroom of the store, she purchased one similar, which comes in several boxes, got home to assemble it, and she may decide that it was too much trouble and then simply returned it to the department store.

Of course it stands to reason that you may want to beat the britches off of Wally World's prices, so you may sell that same center @ $90.00, even with the freight cost added in to that unit, you could possibly see a 300% profit margin. Of course that is for you to determine, as you know your geographical area and what your market will stand better than anyone. This requires patience & research on your behalf. SAM can assist you with our vast knowledge of retail experience gained from years of working with people just like you. Be careful of those liquidators who state as a matter of absolute fact, "Buy from us and triple your money". This again is less than honesty.

Note* Many major department stores have stringent guidelines to the selling of the distressed merchandise which has originated from their stores. SAM is required to follow the policies of the geographical control the company has set forth. There are other requirements that will also be addressed when you purchase a particular merchandise load.

Electronics only have an average of only 20% to 25% mark-up from wholesale to retail, be cautious. Electronics do not work on the 100% mark-up rule. But electronics can be extremely profitable if the damages (throw-away) is minimal.

The Station of liquidation

Below is a sample of an actual un-doctored manifest, which list this particular company's merchandise at 25% of their wholesale. This is from a national leader in retailing.

You will notice the percentage. On the right column you will see actual retailer's cost. Multiply cost by 25%. Add each page of cost. This retailer's typical manifested load averages from $25,000.00 to $30,000.00 in wholesale cost. Remember the Rule of Thumb, ($60,000.00 in retail) . No two loads of merchandise are identical.

The liquidator usually charges a fee of 10% overall from this particular retailer's overall wholesale cost.

Example

$30,000.00 X 25% = would be $7,500.00. Then the liquidator's fee of 10% or $750. For a total of $8,250.00 plus freight cost, which is usually around 10% to 15% for an average total of $ 9,075.00

Normally the end buyer or retailer who purchases this merchandise will figure an additional 15% for actual calculated damages, which is called "throw-away". So if your actual retail is calculated @ $60,000.00 X 15% = $9,000.00 in throwaway leaving a total retail value, resalable of: $51,000.00.

A calculated and profitable Risk

Most retailers of liquidated merchandise who purchase distressed merchandise will usually sell the merchandise in fierce competition with the mega retailer @ 50% of the actual retail, regardless of the item. So estimate $ 51,000.00 divided by two for a resale value of $ 25,500.00. You have approx. $ 9,075.00 invested with a margin of $16,425.00. Figure in your overhead and you will have an estimate of the profitability.

The idea is to move the merchandise as rapid as possible, which can be possible, as people are always hunting good bargains, on typical every day usable general merchandise regardless of the so-called economy.

But keep in mind the rule of thumb of 50% is not always followed, as some merchandise may be in high demand and retrieve a higher price, while others may move more slowly and need be reduced in price to sell.

It does not matter whether the economy is good or bad, people will always be looking for the good deals.

You can use basically the same calculations with manifest that are based upon the actual retail cost.

Remember the rule of thumb is, that if the retail giant spends $ 1.00 they will usually re-sell for $2.00 Giving plenty of room for their sizzling summer sales, etc.. Their profit margins are high even with their blowout sales offers.

Over the years, I have heard the newcomers in this business say, that some broker has told them that they should not buy loads which are not manifested. This is about as far from wrong as he can be. Normally the broker will tell an inexperienced buyer this, only because the broker can not possibly represent a non manifested load, because the broker usually does not have a warehouse and may have never witnessed any load of merchandise. The broker usually and only, has access to what is on a paper manifest, provided by a liquidator. Not understanding the fundamentals of the business, all the broker can do is repeat what a liquidator has told him or her about a load. If it is not on paper, they simply do not know how to offer it.

Think about this, the retail mega giant, have usually, already lost thousands of dollars of value in a full 48' semi tractor trailer load of merchandise customer returns & surplus. It will cost the retailer an additional hundreds of dollars for the manifesting process, labor etc. Of course if the load is manifested, then you will be charged with the result, which has been added to the cost by percentage. The retail giant cannot absorb any more losses, thus you pay for manifesting, in added percentages. The retail giant also has to provide warehouses for the manifesting process, which will also be tacked onto the cost of the merchandise cost.

We have found some of the best deals for the end retailer are the Bulk loads.

SAM sticks with the bulk loads, that we rarely have experienced trouble with, and the loads that the buyer always come back for, load after load. These loads are usually similar to manifested loads but at cost way below the manifested load cost.

When a customer is a repeat buyer time after time and load after load, we are certain that the merchandise is profitable. Of course the customer will tell you immediately whether the load is good or bad. I have witnessed and given a couple of concessions for loads that may have had a higher margin of throw-away, but I have never had a customer tell me that they made $10,000.00 more than expected, and then offered me $5,000.00 for their good fortune. (Pun intended)

We have found that many times it is far more beneficial to refer a good customer to a reputable competitor, who may have exactly what the customer needs, other than us not having or providing it, and the customer lose profit which could be used for future buying from SAM. If we tell them where they can get it and they make profits, they will always attempt to return the favor. This is what true SERVICE is about.

There are several solid companies who are noted and reputable liquidators. We have found them to be honest in our many transactions.

Our special thanks for your sincere honesty & excellent ethical business practices.

Of course there are many others in our field who may have minimum to medium reputations, but then there are many liquidators not listed whom you may need to be aware of. Be sure to ask them many questions. Call SAM, we will tell you our past dealings with any of the company's that may be in question. We feel that if a liquidator will lie or steal from SAM or any of the SAM customers at any time in the past, then where will you stand with them? There are in fact many liquidation companies to be aware of that only sell for the sake of moving merchandise.

We absolutely with certainty, have no problem of discussing a bad apple liquidator of merchandise. We thoroughly understand how people may feel about one company that runs down another company. However our feelings are, that most mom and pop start up companies, usually are strapped for their hard earned cash. Usually they have hocked their car, home and maybe their children's college savings. All, just to be treated less than honorably by a bad apple liquidation company. And could lose thousands of dollars or their businesses. We will not stand aside silently and allow this to happen to you from those that have a reputation of dishonesty. We have in the recent past witnessed some of these liquidators move their operations to the west coast, where they may have a new market of unsuspecting customers to prey upon as they have exhausted the east coast with their dishonesty. Keep your eyes open for such moves.

We feel that if an liquidator is dishonest in even a small way then they are no different than a thief that would pull a gun on you at night in a dark parking lot, and they should be prosecuted to the fullest extent of the law. But please keep in mind that these are confined to a few liquidation companies.

A thief is a thief no matter how they may look at it.

So Don't Forget

"A trip to our warehouse is a small price to pay for an education."

SAM will not be a part of blatant dishonesty, and will do whatever it takes to educate the new retail liquidator about every aspect of the business. Come and visit us or simply call us @ (800) 261-9150.

We will be just a phone call away and we are willing to tell you what we know about a certain merchandise lot, load or any unscrupulous liquidator to be cautious of. We have seen just about all of them and get many of their discarded orphans.

Advertising

There are many national publications, which directly market liquidation companies. Usually, just like any advertising publication, they have an unbiased opinion as to the services or the reputation of a particular company.

Some of the largest publications are similar to the

"Hound Dog Theory"

Many retail outlet liquidation retailers solely depend upon these publications for their merchandise needs. Many do not have technology to research existing suppliers who do not depend on these types of publications for their customers. They usually have built reputations for themselves that need only word of mouth alone, and they may not have the desire to grow too fast.

So this leaves only the liquidation companies that do advertise in these publications. Once a month a publication will come out and usually the small to medium retailer will anticipate its arrival similar to a bunch of old hound dogs waiting on a bone. And when this bone is thrown into the hound dog pen, the hound dog’s fight over the choicest parts of the monthly-allocated bone offers. They are so busy fighting over the scraps they have no time to research and find the thousands of great deals that are out there other than the monthly bone, which has been thrown to them. Many of your more experienced buyers have broken away from the pack. They have been successful hunting alone and have discovered many deals outside of the pen.

Those retailers that do not depend upon these publications are usually the ones that have purchased technology, i.e., fax machines, computers with Internet access etc. and have seriously learned to find the hidden and best deals.

SAM does and will continue to advertise in various publications, however we have found that word of mouth, internet & networking with our well known competitors who have good reputations, have helped us to break away from the pack, find better offers and pass them on to you.

Our main focus was to be different than the existing competition. We decided that no matter how small the customer was, they were every bit as important as the big volume buyer. The small customer will always grow if they have the right supplier. We found that most, after fighting over that bone (monthly merchandise offer) were just too tired to muster the strength to find the best deals and bargains that exist on the market, though unseen. We found that most liquidators don't want to waste time with the one or two pallet-buying customer. Thank's guys. This has benefited us, by giving us many neglected orphans, who now depend upon our team of seasoned, personal approach and down to earth folks. We work hard to provide those behind the scenes deals. We make every effort to find and then throw choicer t-bone steaks to our customers.

SAM'S "Sizzling Sirloin Service"

How do I get involved in buying and selling distressed merchandise?

It is simple, roll up your sleeves and get started, call SAM Toll Free @ (800) 261-9150. Of course you need money. We recommend that you start buying by the pallet first and gradually work your way up to full loads. Unless you are an experienced liquidator, then of course you may already buy by the full loads. Start small and build your inventory. We have hundreds of customers who began by purchasing by the pallet and who now purchase by the full semi load, as they have discovered that the freight is then maximized for the cost per item. Almost every business opportunity offer today requires thousands of dollars in investment to buy franchises or such offers as vending machines, etc. The merchandise recovery business is by far one of the best offers we have ever personally witnessed. A small investment as low as several hundred dollars or several thousand, will get you operating in a short time, you decide.

Garage sales

My daughter is now a Bachelor of Nursing, and striving for a Masters Degree. She helped pay for her tuition by selling pallets of general merchandise at a weekly garage sale in the same neighborhood week after week. The old ladies and young couples love her for her wonderful offers. Each week they anticipated her sale.

We specifically remember a customer several years ago who was buying 5-6 pallets a week. She had a targeted Grand Opening for her 4,000 sq. foot store, a month or so away, I'll never forget how much whining she did about all the stuff she bought and how she was going to go broke and how she was not going to be able to sell the merchandise and...on and on. It got to the point that I became so aggravated with her continuous whining that I treated her like a red haired step child and finally, when I could not deal with her whining any longer, I put one of my sales rep's on the line to deal with her, I had, had enough of her complaining. I'll never forget the day she called, after she opened her store, she called hysterically happy and shouted "Oh my gosh ship me a full load, I have sold it all."

She has been extremely successful every since that date and has now built a 5,000 sq. ft. warehouse just to store merchandise, in addition to her 5,000 sq. ft retail store. We continue to offer her the education of diverse merchandise offers. Her customers remain excited week after week in anticipation, waiting on new and different merchandise.

About 50% of the outlet centers that deal in surplus merchandise began modestly with pallets and have built successful enterprises. The other 50% began by purchasing full loads. At SAM we never take a call from a new customer who (Just) wants pallets, and then treat them rudely, we know from our experience that if they work hard they will be successful. It is our small customers who have helped us succeed in this industry and they are our business's lifeblood. At SAM, we do not care if you buy a single pallet or a hundred loads of merchandise; we strive to treat all of our customers with the same respect. We understand that if you get good merchandise and operate your business seriously, you will someday buy by the full truckload. We hope to be there when that happens.

Do not ever believe that the distressed merchandise business is a "Get Rich Quick Scheme" or a "Pie in the sky opportunity". If it were easy, every one would be doing it. This business definitely requires long hours and hard work.

With hard work and right buying decisions you can make it into a lucrative retail business. Be certain that you buy rightly and from a reputable liquidation company. SAM advertises in a national publication, a phrase, which we sincerely believe;

" A trip to our warehouse is a small price to pay for an education."

The SAM Warehouse & Advanced School of "Liquidation 202" Education.

Be sure to be careful of the liquidation vultures that are seeking a free ride.

The liquidation Vulture

Where can I possibly sell good distressed merchandise that I purchased from SAM?

Most folks who get into the salvage & surplus business start small. However there are those who have known of the business potential in their geographical areas for years and may start with retail store and buy a truckload or two. Volume purchases usually always reap the best returns of profit because of volume and freight cost.

Many folks began by selling merchandise at flea markets during the weekend. This is always a good idea to get your (feet wet)