Grade is the single most useful word on a liquidation listing. It tells you how hard the merchandise has been handled before it reached us, and that drives almost everything else: how much of a lot you can sell at full price, how much time you will spend testing and sorting, and what you should be willing to pay per unit.
We use four grades at Direct Pallet Outlet, and every listing names one. Where a listing does not name a grade, it is sold as Customer Returns.
New / Overstock
Merchandise that was never sold to a customer. It sat in a warehouse or a distribution centre and became surplus because a retailer over-ordered, a season ended, or a line was discontinued. Packaging is usually intact and sealed.
This is the cleanest grade and the most expensive per unit. If you sell somewhere that expects retail-quality presentation, this is the grade that works without rework.
Shelf Pulls
Stock that reached the sales floor but was removed before anyone bought it: a planogram change, a price reset, a store closing, a damaged outer box. The product itself is typically unused, but it has been handled by staff and customers.
Expect scuffed boxes, missing hang tags, price-sticker residue and the occasional opened package. The product is usually fine. The presentation needs a wipe-down and sometimes repackaging.
Customer Returns
Merchandise a customer bought and brought back. This is the largest category in liquidation and the one most lots fall into. A return can be anything from “wrong colour, never opened” to “used for three weeks and genuinely broken”, and the same pallet will contain both.
This grade is where the margin is, and it is also where the work is. Plan on opening, testing and sorting every unit. A realistic expectation for untested customer returns is that a meaningful share will not be sellable as working product — some will need parts, some will be missing accessories, and some will be scrap. That is priced into what you pay.
Salvage
Lots where damage is expected rather than incidental. Salvage is bought for parts, for repair, for scrap value, or by sellers who have a specific channel for damaged goods. If you do not already know what you are going to do with broken product, this is not the grade to start on.
How to use grade when you are comparing lots
- Do not compare price per unit across grades. A Customer Returns pallet at a third the price of an Overstock pallet is not automatically the better buy once you account for the units you cannot sell.
- Match grade to your channel. A bin store can absorb Shelf Pulls and Customer Returns easily. A marketplace account with strict condition metrics usually cannot.
- Factor in your own time. Testing and sorting Customer Returns is real labour. If you are paying someone to do it, that cost belongs in your per-unit maths.
What grade does not tell you
Grade describes handling, not function. No grade is a promise that every unit works, and it is not a warranty. Liquidation merchandise is sold as-is and untested unless a listing says otherwise, and manufacturer warranties usually do not carry over to liquidation buyers — the chain of purchase is broken, and most manufacturers require a receipt from an authorised retailer.
What you do get from us is a route out if a lot as a whole is not what the listing described. Report damage, a shortage, or a lot that is not as described within 7 calendar days of delivery or pickup, and we will deal with it under the Warranty Policy. Separately, any lot can be returned within 30 calendar days for a refund of the lot price, with no restocking fee, under our Returns & Refund Policy.
If you are weighing up your first order and want the full picture on grading, manifests and freight, the Buyer’s Guide covers it end to end.
