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Processed Loads versus Unprocessed Loads
Are You Paying Too Much and Not Getting Enough

There are 2 types of general merchandise loads. Processed Loads and Unprocessed Loads.

Retailers sort and consolidate their shelf pulls and customer returns and send them to holding warehouses or directly to processors/jobbers. The vast majority of the loads sent to holding warehouses go on to processors/jobbers. The majority of loads on the market are processed as a result.
Unprocessed loads
These loads are in the same basic configuration as when they left the retailer's store. They are difficult to get as the current trend is to heavily process the loads.

Some common characterless of unprocessed loads:

High retail value:  Many unprocessed loads have retail values of $80,000 to $110,000.  This is because they have not had premium items removed.

Full trucks: The volume of loads is usually high before anything is removed.

Damage rates are low: Many Unprocessed loads contain lots of clean returns and shelf pulls.

Good selection of merchandise. Unprocessed loads usually have items out of popular categories like electronics, housewares, tools, hardware, new product, and others.

Low cost as a percentage of the retail value of the load: Unprocessed loads can have retail values 3 times to 5 times the amount of processed loads. There is usually substantially more retail value in an Unprocessed load since premium items have not been removed.

Low risk loads: Lots of clean sellable product

Unprocessed loads can be graded
 
Processed Loads
Processors sort the loads into select categories that commonly include electronics, housewares, tools, hardware, HBA, new product, and others. Many of the better items are removed from the loads for sale on 3rd party websites. This practice has increased greatly over the past few years with the growth and popularity of retail and semi-wholesale websites. Processed loads make up the vast majority of loads on the market.
Some common characteristics of Processed loads:

Low to moderate retail values: The processors target high retail items that are easy to sell online. Things like electronics, tools, housewares, HBA, fishing equipment, and overstock product go first. A Processor can easily reduce the value of a load 50% to 75% by doing this.

Low to moderate volume: Pallets shrink when merchandise gets removed.

Moderate to high damage rates: Processors target overstock and clean return products. The overall damage rate is much higher once they are finished pulling out the clean product.

Moderate selection of merchandise: Even Processed loads have multiple categories but many items from the most desirable categories have been removed.

Moderate to high cost as a percentage of retail. The value of sellable merchandise is reduced by processors removing high retail items, overstock, and clean returns. The sellable amount of the processed load is much lower that before processing. This gets the cost as a percentage of retail high. You can easily pay over 50% of retail when all factors are figured in.

Moderate to high risk. There is always more risk when a processor removes premium items out of a load. We offer Processed loads for under $10,000 that are lower risk than average.

Processed loads can be graded
 
A quick note on loads bought on auction sites
Some GM loads are sold by competitive bidding on semi-wholesale auction sites. These Processed loads are usually low retail and sell for $5,000 to $7,000 but the retail values are too low for the cost and you can easily have %50 or more cost per retail dollar in them when figuring in damages,MSRP overstatements, and unsellable merchandise. These semi-wholesale websites can have lots of uninformed bidders that don’t understand liquidation products and run the bids up on loads well past the point of profitability. Do you really want to compete with tens of thousands of people for your store inventory?
 
You need to know the difference between Processed and Unprocessed loads. Processed loads are OK as long as you account for the value of the products that are removed and the higher damage rate.
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