How Liquidating Unwanted Goods Became A $644 Billion Business part 2

Unknown: Cardboard, we probably do about 200 tons a year of cardboard recycled, 20 tons of Styrofoam a year, and about that same amount in electronics recycling. Katie School: We scan every item that comes in and make sure that they can put it in the manifest. Items are sorted by workers like Carlotta Barnes, who's been at the Garland warehouse for nine years. We take it out and make sure that the product is okay to sell. When items are ready for resale, they're wrapped back up. We see we've got a couple Christmas trees. We got some decorative pillows, some furniture, a desk maybe. How much is something like this probably going to auction for? Unknown: So it's going to start for $100 on Liquidation.How Liquidating Unwanted Goods Became A $644 Billion Business And then the market is really going to set what that is going to sell for. Katie School: They're stacked into aisles, awaiting their turn for auction on one of the Liquidity Services' marketplaces. There's Liquidation.com, where pallets of returns and some individual items are auctioned off to the highest bidder.  direct sale of individual items,  those unclaimed packages, TSA items or outdated military equipment. While Liquidity Services is one of the biggest liquidators, there are thousands of companies in the booming space. One is Good Buy gear, which sells gently used baby and kids gear as an alternative to Facebook Marketplace or Craigslist. This space in particular really warrants a trusted third party because, you know, it's stuff that your baby's going to sleep in or sit in and eat in.  Gear after her youngest, who's now six, outgrew a particularly bulky item. It's $150 to buy it brand new it was amazing for the few months that she used it and then after that, zero use for it, you know. A big eyesore in the middle of your room. Another big player in the space is B-Stock, which runs branded liquidation marketplaces for huge clients like Amazon, Walmart, Home Depot and Costco. Unknown: We sold somewhere in the vicinity of $150 million individual items last year. Katie School: Howard Rosenberg founded B-Stock after six years at eBay, where he saw the benefits of specializing in liquidation for others, at scale. Unknown: So companies typically don't want to spend a  of time and effort focused on that little slice of the pie. They want to focus on the 99% slice of the pie. Katie School: Liquidated returns reenter the circular economy through individuals selling on Craigslist or eBay, pawn shops, flea markets and thrift stores. Sonia Lapinsky: Wanting to reuse, wanting to have less of an impact on the environment. They're also getting a good deal, right? Like we're being trained not to pay full price. And if you can kind of do both things at the same time and get a good deal, I think that's what all the younger generations are about. Katie School: But a lot of returns can't go right back out for resale. Unknown: You can see it still has plastic on it from the original manufacturer. And so we know this is a very new unit, never been used, but it was damaged during shipping. And what we can do is replace this glass with a donor glass from a unit not functioning. Katie School: The refurbishment department is a big part of Liquidity Services' business. How many are you doing every day, would you say? Unknown: We do about 100 TVs a day they sell for anywhere from 60% to 70% of retail. My youngest has come and, you know, she's amazed by the machines she's asked a couple of questions. Katie School Stephen  relocated with three of his four kids to manage the Garland warehouse. He's been with the company six years. Unknown: I try to explain it to her to where she understands it's like, hey, when you have kids, this directly will affect you and your kids. This little piece of the operation that no one thinks about will have a vast effect over the next 50, 60 years. kids have led a push for more sustainable retail options, boosting the overall popularity of secondhand shopping across all generations. In a survey of 1,000  81% of baby boomers participated in resale in 2021, up from just 39% in 2019. Refurbished electronics have also gained popularity because of the shortage of new goods. Unknown: When we get a refurbished product, we get really good recoveries back from it, so probably 80% to 100% of recoveries depending upon the seasonality in the market. But right now the market is very strong because of the supply shortages on the forward side. Katie School Refurbished consumer electronics like noise-cancelling headphones or HP laptops are in high demand, but also high-end refurbished items like the machines used to make microchips. Unknown: We've seen Fortune 500 companies access used equipment on our marketplace because the time to ship is shorter in the circular economy  originating a newly manufactured good, putting it on a vessel, transporting it across the ocean, to a port that's likely backlogged for six to eight months. Katie School: And as the secondary market grows, many retailers are now selling refurbished items directly. Amazon has entire sections of its site devoted to this. There's Warehouse Deals for used goods, Amazon Renewed for refurbished items, Amazon Outlet for overstock, and a tongue-in-cheek daily deal site called  that sells a $10 bag of crap.  now has an online outlet where it sells open-box appliances and TV and HP has an outlet with refurbished computers and more. Unknown: We're going to remanufacture it and remarket it with an HP warranty. Or we're going to sell it as-is to a certified contracted partner, who will then either re-manufacture it themselves and sell it with their third-party warranty or part harvest it  sell the parts. Katie School: The liquidation boom has spawned another trend, too. Hundreds of bargain bin stores are popping up all over the country with names like Dirt Cheap and Treasure Hunt Liquidators, where dozens of customers line up, sometimes even camping  to get first pick after weekly drop-offs of liquidation pallets. They dig through bins and bins of returns, in search of trending items they can flip for a profit. Tony Sciarrotta: Stores like Big Lots, Bargain Hunt, Ollie's Bargain Outlet etc. All of these stores and then eBay, and even Amazon has gotten into it. So they're selling the returns back to consumers because, again, 90% of the time, nothing wrong with it. Katie School: Liquidity Services has its own take on the direct-to-consumer trend. At the company's new  Deals warehouse that opened in Phoenix in October, customers pick up items they've won in online auctions that usually start at $5. This is especially helpful for liquidating bulky items like kayaks. But something like that is going to be very expensive to ship, no? Because it's so big. Unknown: That's the beauty of our fulfillment center network. We can take these items back directly from consumers, and then have consumers bid online and pickup at our warehouse. Katie School: Angrick plans to open a second  Deals warehouse in Dallas later this year. Unknown: The more people discover that hey, there's nothing inherently wrong with this product. I trust the marketplace that sold it to me. I can save significant dollars. That's really benefiting all parties.