The Landed Cost Formula Every Liquidation Buyer Should Memorize
Hammer price is not your cost. Here is the full equation, with the fee lines buyers forget.
ROI & PricingThe formula
Landed cost = hammer price + buyer's premium + payment processing fee + freight + accessorials (liftgate, residential, redelivery) + your handling labor + storage. Every one of those lines is real, and the last two are the ones buyers pretend do not exist.
Typical magnitudes
Buyer's premium commonly runs 5-15%. Payment processing adds a couple of percent. Freight on a single pallet cross-country can rival the hammer price itself. Accessorials add $50-150 quietly. Handling at even 60 seconds per unit is meaningful on a 400-unit Walmart load.
Working backwards to a max bid
Start from modeled resale value, subtract marketplace selling fees and shipping to your customers, subtract your target margin, then subtract every landed-cost line above. What remains is your max bid. If that number is below the current bid, you are done, close the tab.
Where PalletIQ fits
Upload the manifest and PalletIQ models per-SKU resale value, recovery rate, and category profit, then outputs a Max Bid. Enter your premium and freight so the number it gives you is landed, not theoretical.
The discipline part
The formula is easy. Obeying it when a pallet looks exciting is the hard part, and it is the only thing that separates buyers who compound from buyers who churn.
Analyze before you bid
Upload any manifest to PalletIQ and get a grade, recovery estimate, category profit breakdown, and a hard Max Bid in under 60 seconds. New accounts get free analyses, see the marketplace comparison for where to source.
Sources worth checking yourself
- Wholesale Ninjas, overstock and return pallets.
- American Liquidations, truckload and pallet sourcing.
- AllSurplus, industrial and commercial surplus auctions.