How much is my excess stock worth? How stock buyers really price a parcel

"What's it worth?" is the first question every seller asks, and the honest answer is that it depends. That's not a dodge. Two parcels of the same product can be worth very different amounts because of their dates, their location or the conditions attached to them.

This guide explains what actually drives the value of excess stock, why simple rules of thumb get it wrong, and how we work out an offer.

What is the liquidation value of inventory?

The liquidation value is the price a buyer will pay for stock sold outside your normal channels, usually in bulk and in a hurry. It's not what the stock cost you, and it's not its retail price.

Accountants and the ATO also talk about "market selling value", which is the value of stock sold in the normal course of your business. Liquidation value is usually lower than that, because the stock is being sold outside the normal course: to a different kind of buyer, in one lot, with conditions attached. If you're thinking about the tax side, see our guide to writing off obsolete stock.

What decides how much my stock is worth?

Ten factors do most of the work. Here they are, roughly in order of how often they move the number.

1. Brand strength

Known brands sell faster and to more buyers. A recognised name lets a discount chain sell it without explaining it to anyone. An unknown brand has to earn its place on the shelf, and that usually means a lower buy price. Licensed products sit somewhere in between, depending on whether the licence is current and the character still popular.

2. Quantity

More stock isn't always worth less per unit, but it does narrow the field. A few pallets can go to many buyers. Twenty semi-trailers can go to only a few, and they know it. We've sold 37 semi-trailers of short-dated orange juice, so big parcels are very possible. They just need the right outlet.

3. Dates and remaining shelf life

For food, health and beauty, and anything with a best-before or expiry date, time left on the date is often the biggest single factor. Buyers need enough time to move the stock through their own channel. Value falls as dates get closer, and the fall speeds up near the end. Our guides on short-dated stock and what food date labels really mean explain more.

4. Condition and packaging

Clean, retail-ready cartons on sound pallets are worth more than crushed outers, loose units or faded packaging. Damage doesn't always kill a sale, but it narrows the buyers and adds handling. We tell our buyers honestly about any fault, which keeps deals from falling over later.

5. Seasonality

Christmas stock in February, swimwear in winter and Easter eggs in May are all harder to sell now than in a few months. A buyer either has an outlet that wants it now, or has to store it until the season comes round. Both cost money.

6. Channel and price restrictions

Conditions protect your brand, and they're often worth having, but every channel you rule out removes some buyers. "Not in Australia", "not online" and "not below a set price" each shrink the pool. That doesn't mean don't set conditions. It means set the ones that matter and expect them to show in the offer. Read how to protect your brand when clearing stock.

7. Location and freight

Stock sitting in Sydney near a buyer's distribution centre is worth more than the same stock in a regional shed or overseas. Freight, handling and, for export, documents and shipping all come out of what a buyer can pay. Low-value, bulky goods are hit hardest. Collection is something we agree per parcel; it can be our cost or yours.

8. Completeness of range

A full size run or a complete set of colours is easier to sell than the leftovers. Odd sizes, single colours and broken sets need a buyer who doesn't mind, and that's a smaller group. Job lots can still sell well, as our 85,798 pairs of shoes parcel shows, but the mix matters.

9. Compliance and labelling

Products need to be legal to sell where they're going. Missing Australian labelling, wrong ingredient panels, absent safety warnings or electrical approvals can rule out local sale or mean relabelling. Sometimes export solves it. Sometimes it means extra cost. Either way, a buyer will price it in.

10. How quickly you need to sell

Time is worth money on both sides. If you can wait for the right buyer to be looking for your category, you may do better. If you need cash by a set date, for example because an administrator is involved or a lease is ending, the field shrinks to whoever can act now.

Why do "% of RRP" rules of thumb mislead?

Because they ignore almost everything on the list above. A rule of thumb treats a famous brand with long dates in a Sydney warehouse the same as an unknown brand, three weeks from expiry, in a regional shed. Those two parcels may have the same RRP and wildly different values.

RRP is also the retailer's number, not yours. It includes the retailer's margin, rent, staff and the expectation of selling one unit at a time over months. A bulk buyer is taking all of it at once, with risk, freight and handling on top.

Rules of thumb also cut both ways. Some sellers turn down a fair offer because it's "below the usual percentage" and are still holding the stock a year later, when it's worth less. Others accept a low number because it sounds normal. We don't quote percentages for exactly this reason. The only number that matters is what a real buyer will pay for your stock, now.

If you're weighing up an offer, our guide on when to take an offer on your overstocks is worth a read.

How does John work out what a parcel is worth?

He surveys the market, quietly. Instead of guessing from a formula, he finds out what real buyers would pay for your stock under your conditions.

1. You send the details. A stock list spreadsheet (SKU, description, quantity, cost or RRP if you're happy to share, best-before dates), photos, and the location.
2. John discreetly surveys the market. He talks to the buyers in his network who might want it: major retailers, discount chains, overseas buyers, charities, wholesalers and distributors. Each has different motivations. He does it discreetly, so the market doesn't hear that you're clearing stock.
3. He makes an offer. In most cases, it's an offer to buy all of it. If buying the whole parcel isn't possible, he gives his best advice on how to sell it.

Because we buy the parcel ourselves and resell it, we don't charge you fees to broker or advise. Our margin comes from selling the stock well, so it's in our interest to find the best outlets.

Sometimes the value comes from somewhere unexpected. We once bought a discontinued line of glass bottles, had them filled with soft drink by a beverage company with spare capacity, and sold the finished product to a discount retailer. Empty bottles became a finished product with a buyer waiting.

What doesn't change the value, even though people think it does?

A few things sellers often expect to matter, and mostly don't:

• What you paid. Your cost matters to you and your accountant. To a buyer, it's background. The market sets the price.
• How good the product is. Quality helps, but a brilliant product with no outlet is still hard to sell. A plain product with a waiting buyer can sell quickly.
• What the retail price was. As above, RRP reflects a different kind of sale.
• How long you've held it. Time costs you storage and dates, but buyers don't pay extra because it's been a long wait.

What does matter is whether a real buyer has a real outlet for it, now, under your conditions.

What does a stock buyer's offer actually cover?

When we make an offer, we're taking on more than the stock. We take the risk that the market moves, the cost of finding buyers, freight, handling and the time it takes to sell everything through. We also take the slow lines along with the fast ones when we buy the whole parcel.

That's why an offer for a whole parcel looks different from adding up the best price each line might fetch on its own. The trade-off is that you get one deal, one payment on agreed terms and no tail of leftovers. For some sellers that's worth a great deal. For others, with time and staff to spare, selling line by line may make sense. Our guide to who buys excess stock in Australia compares the options honestly.

How can I increase what my stock is worth?

You can't change the brand or the dates, but you can make the parcel easier to buy.

• Act early. Value usually drops with time, especially for dated or seasonal stock. The best moment to call is when you first suspect a line won't sell through.
• Send a clean stock list. Accurate quantities and dates mean fewer surprises and fewer deductions for uncertainty.
• Include good photos. Show the product, the packaging and the pallets.
• Be honest about faults. A buyer who finds a problem later will want a lower price, or walk away.
• Keep conditions to the ones that matter. Protect the channels you need to protect, and leave the rest open.
• Sell the whole parcel together. Cherry-picking the best lines yourself often leaves a tail that's hard to give away.

Where do I send my stock details?

Send your stock list, photos and location through our contact page, or read how selling excess stock to us works. We buy from anywhere in Australia, from New Zealand and internationally. There's no minimum parcel size.