Planet Money has an interesting podcast on the economics of returned goods.
https://www.npr.org/2022/01/12/1072447059/no-such-thing-as-a… the transcript is at https://www.npr.org/transcripts/1072447059
On average, American consumers return about 10% of the things we buy. And for online retail, the numbers could be more than double that … The volume is somewhere between 500 billion and $600 billion this year.
There is nothing efficient about opening up a trailer full of 26 pallets of returned goods that are not rewrapped nicely as they were delivered. You might have a thousand items. Every item is likely to be different.
Each returned item has to be inspected to see if it can be resold. For expensive stuff, this might be worth it. But for cheap stuff? No way. It is either sold in bulk or sent to landfills. People buy pallets of returned goods with no idea what’s in them with the hope of reselling for a profit online. People make youtube videos of opening the pallets. Others have built a new business model, buy pallets of stuff, put them in a vacant store, no shortage of those these days, and throw the doors open at a specific time. It’s like a feeding frenzy. It’s almost like a Black Friday every weekend.
Resellers shop the stores looking for bargains to resell online. There’s enough resellers that it’s a feeding frenzy, everyone looking for the profitable items among the junk. The reporter went with two resellers to one store, the Treasure Hunt Bin Megastore in Raleigh NC.
Asalyn and Makayla are resellers. They’re part of a growing category of entrepreneurs that buy and then resell the things the rest of us have returned … Today, two of their fiercest regular competitors have managed to beat them to the front of the line. So what they lack in position, they’re going to have to try to make up in strategy. They use binoculars to spot hidden treasures inside. Then they draw up a map and plan out little plays, almost like a football coach … OK, possibly one of us going to go after the fireplace and the blender, and the other will go after, like, the NuWave air fryer over here or the smokeless grill back there … As the last couple minutes tick down before the doors open, Asalyn and Makayla get all somber and quiet, kind of steely-eyed. It feels a little bit like one of those World War I movies when all the grim-faced soldiers are lined up shoulder to shoulder in the trenches, and they’re just waiting for the signal to run into no man’s land … When fortunes are won and lost is all over in about five minutes of vigorous digging.
After they snag their stuff, they pause before paying for it, checking prices online to make sure they can make a profit.
On average, they say, they’ll make a combined $800 or so a week, enough to cover tuition and school supplies and dog food.
