These are not easy times for small businesses. Running a small business is a notoriously tough task under even the best of circumstances and, despite a relatively strong economy, these are certainly not the best of circumstances for small businesses. That’s because small businesses face massive and often unfair competition from giant corporations like Amazon and Walmart, particularly in the retail space.

Retail Store Shopping

A mom-and-pop shop may be able to run circles around Walmart or Amazon when it comes to customer service, but pricing products as low as Amazon or Walmart is virtually impossible for businesses that lack their massive scale. Economies of scale give Walmart and Amazon all sorts of ways to save money that simply are not available to small businesses, and that makes it all but impossible for traditional retail businesses to measure up to the big-box stores and the e-commerce giants.

The result is what you’d expect: More small businesses are failing due to their brutal competition, and others are seeing their profits shrink.

Yet, at the same time, there are other businesses that are actually being helped by Amazon and other giant corporations. To flourish in such strange circumstances, businesses need a unique approach and clever tactics. And one business space where this is happening in a big way is the liquidation and returns business, which relies on liquidation and returns auctions.

Liquidations and Returns Auctions

Big companies like Amazon and Walmart have generous return policies — they’re so big that they can afford to. But Amazon and Walmart don’t always restock returned items, especially when those items are returned by mail. Furthermore, Amazon and Walmart don’t need to eke out maximum profits on products they’re ready to liquidate — when new stock comes in and room needs to be made, Amazon and Walmart are ready to offload such products on the cheap.

So what do they do? They load them up on pallets and sell them wholesale to businesses like Direct Liquidation. The retail giants aren’t interested in selling these items (or even these entire pallets) individually, so the pallets go to liquidations and return auction companies.

Then, as the name suggests, these liquidations and returns auction companies auction off the pallets to the highest bidders. Once again, these pallets are often not sold for their true value.

But the products are sold for their true value in the next stage of the game because the folks who bid on pallets on sites like Direct Liquidation are the savvy small business owners who are making their giant competition work for them instead of against them.

Liquidations and Returns Businesses

Small businesses that bid on and win these pallets of returned and liquidated merchandise get a whole lot of product for a very small price. And, unlike Amazon, these businesses have the time and the incentive to go through the products on the pallets and determine what can be resold and for how much.

Returns and liquidations businesses resell these B-stock products on platforms like eBay and even, in many cases, on Amazon itself. Since the products were acquired so cheaply, returns and liquidations businesses can charge competitive prices and survive in the age of Amazon. And as business owners get better at identifying good deals on pallets and pricing worthwhile products accurately, these sorts of businesses can become leaner and more profitable.

Running a small business is never easy, but the existence of returns and liquidations businesses is a great reminder that the ingenuity of small business owners should never be underestimated!