How to read a liquidation manifest before you buy

A manifest is the spreadsheet a liquidator sends with a pallet or truckload. It lists what is supposed to be inside. It is also a sales document, written by the person who wants you to buy the pallet, and it should be read that way.

Most bad pallets were bad on paper. The buyer just did not read the paper closely.

The columns and what they actually mean

UPC. The barcode number. This is the only column you can fully trust, because it is the only one you can verify. Everything else on the manifest is a description. The UPC is a fact.

Description or title. Written by the retailer's system or the liquidator. Often truncated, sometimes wrong. Never price from it.

Quantity. Units of this line. Watch for lines with very high quantities of one item. Forty of the same phone case is not forty sales, it is one sale and thirty-nine bin fillers.

Unit retail, MSRP, or "value." This is the inflated number. It may be the manufacturer's suggested price from years ago, the retailer's original pre-clearance price, or a figure the liquidator made up. Treat it as an upper bound, not a price.

Extended retail. Quantity multiplied by the inflated number. This is the big total in the email subject line. It is usually two to three times what the items would actually sell for at retail today.

Condition. If present, values like "new," "shelf pull," "customer return," "salvage." Returns and salvage need to be tested. Shelf pulls are usually fine. If the column is missing, assume returns.

Cost or "your price." What you are paying. Compare this to the real retail value, not the manifest's extended retail.

The fifteen-minute check

Before buying anything from a new supplier, do this on the manifest:

1. Look up the top twenty lines by extended retail. Search each UPC and find what a major retailer charges today. If the manifest says $89 and Walmart says $34, you have your multiplier. Apply it to the whole pallet.
2. Count the lines under $10 real retail. These are bin items, and if a $10 bin is your top price, they are the items that will not move on day one. If more than two thirds of the pallet is under $10, it is a bin store pallet, priced as such.
3. Find the concentration. How much of the total value is in the top ten items? If it is more than half, the pallet is a bet on ten items. Make sure they are the kind that actually sell in your store or online.
4. Check the categories. A "general merchandise" pallet that turns out to be 300 units of seasonal decor in the wrong season is a common trap.
5. Divide your cost by the real retail total. Most liquidation buyers want to pay 10 to 20 percent of real retail for returns and up to 30 percent for new overstock. If you are at 40 percent of real retail, you will not make money after the price drop.

If a supplier will not send a manifest before purchase, or sends one that does not include UPCs, that is your answer.

What the manifest cannot tell you

The manifest does not tell you whether the items work, whether the boxes are crushed, or whether the pallet was picked over before it was wrapped. Those are questions for the supplier's reputation and your own receiving process.

It also does not tell you what sells in your store. A pallet full of $30 kitchen gadgets is great for a store whose customers cook and dead weight for one whose customers came for kids' clothes. Your own sales history is the other half of the math.

Do it every time, not just the first time

The temptation after a few good pallets from a supplier is to stop checking. Suppliers change. A liquidator who was sending clean overstock in the spring may be sending picked-through returns by fall because their source changed. The manifest is where that shows up first, and fifteen minutes on the spreadsheet is cheaper than a pallet you cannot sell.

The fifteen-minute check is what the free Manifest Analyzer does for you. Upload the spreadsheet and it looks up every UPC, gives you a real retail total, and flags the items worth pulling aside.