A liquidator distributes merchandise that is considered surplus and/or
salvage. A liquidator can get merchandise from a variety of sources
including retail customer returns, stagnant inventory, last seasons
models, overstock, canceled orders and other means.

The Liquidators’ main audience for this type of merchandise is simply anyone
that is searching for wholesale merchandise to resell. Possible clients
of a liquidation company can include Ebay sellers, small retail store owners,
Flea Market vendors and exporters.

Some Liquidators will purchase this type of merchandise in large quantities
and then resell to anyone wishing to buy at below wholesale pricing.
Obviously the Liquidator is in business to make money so all merchandise is
marked up before it is offered to the end reseller.

Not all Liquidators actually warehouse the merchandise they offer for sale.
Hence the term “Broker”. If a Liquidation Company is offering a specific pallet or
truckload of merchandise that they do not own this is called brokering. The
liquidator would list as many details including pictures if available of the
merchandise adding their commission or profit to the sales price. When a
reseller purchases the pallet or truckload the liquidation broker simply
buys the pallet or truckload at that time and then arranges shipping to the
client.

I will stress at this point that there is nothing wrong with a broker who
educates his clients and represents the merchandise being brokered in an
honest manor. Also, a prudent broker will not mark a pallet or truckload up
so high that an end reseller cannot make a profit after freight charges. I
would like to say all brokers act in an ethical manor adhering to the
principles I outlined about, but this is simply not the case.