As you have seen from posts in the past, I have been selling things on eBay alot over the years. With my recent inventory liquidation sale, I have gone back into being more of a full-time eBayer. So I have decided  to take a look in some wholesale sources of goods I could resell on eBay for a little extra revenu (at least to possibly finance my projects). If you did a similar search, one the most likely sites you will stumble upon is Liquidation.com. When you look at the site, they have alot of information, a good selection and... Hey, they are listed on NASDAQ so it can't be that bad of a company, right? Well with my experience so far... NOT!!!

My Liquidation.Com Experience, Selling Junk!

My initial experience with them indicates that it is a company that any buyer or seller should be really careful about and stay away from as much as possible.

So I started by placing some bids on a few items for which the pricing was good (based on other eBay sales). One of the item lots that I bid on was a set of Hitachi 4GB Microdrives (same type as used in Ipods). The items themselves, were used and marked as salvage (I will get back to the salvage problem later). Based on ebay sales and my bidding, I aimed my maximum bid to be at about 25-30% of the average sales price of the same item in the same condition on eBay. This would allow for enough slack to take in consideration of defective parts since these were salvage items (I was assuming a yield of around 50% to be conservative).

Now, coming back to the topic of Salvage items. Liquidation.com's definition is the following "Salvage assets have been identified as defective for reasons concerning their functionality, appearance, or both. Salvage assets usually can only be used for parts." Which makes sense. If you buy a Laptop marked as salvage, the laptop itself doesn't work but it also means that working parts can be pulled from the item either for replacement or resale. My assumption (which was MISTAKE #1) was that if a sub-assembly part (such as a Microdrive and especially a non servicable part) is listed as salvage, it meant that it was pulled from a defective device and was not tested. This means that a certain quantity of items would be DOA and this is why I assumed a yield of about 50% when bidding.

Well the items arrived late last week, and I knew I was in trouble when I just started looking at them. Most looked in really poor physical condition. Scratched up, dented, dirty,... Which did not bode well especially for Microdrives which aren't solid-state. Although I have not tested them all so far, after going through about 90% of them, only about 5% of them are functional. And even those 5% look somewhat sketchy. So I was essentially sold a nice pile of non-servicable junk.

So as of now, I have filed a dispute on the transaction. But from the info on the Liquidation.com website, filing a dispute on a salvage lot is pretty much pointless and you are SOL! So this means the seller can essentially get away with anything. And of course, Liquidation.com does not care as the company makes their Buyer's premium of 5% and whatever listing fees they charged the seller. So I do not expect the dispute to get anywhere and since the form of payment accepted for this transaction was PayPal or Wire Transfer, there is not much of a chance of dispute from that end.

I have also ordered a lot of 1.8" Toshiba HDD from the same seller. So far, it seems like the same thing is happening. I have tested about 60% of them and so far my yield is way under 10%.

I also have a few other lots comming in this week (from other sellers) so I will see in which condition these items are...

My Liquidation.Com Experience, Abusive Fees!

Another auction I have won was for a small lot of new video cards. These were marked as new, so after my initial experience, I assumed this would be a safer bet. And although my markup on these would not be as good, I could still make a few dollars with the sale. There, my MISTAKE #2 was not to request a shipping quote ahead of time. The lot was to ship from Canada and was marked as 10 pouds. From my experience, such a shipment using UPS or FedEx would cost somewhere around $30-$50 to ship. After waiting almost one week for the full order price and a request for payment, the cost of "Shipping and Logistics" on the order is $400!!! Eh, what?

Well, reading the fine print on the shipping costs for international orders on their website indicates a minimum shipping charge of $100 and a $150 document fee. So even there, with the provided weight, the cost should be around $270. But even so, I wish I was paid $150 to prepare a simple customs form. And why a $100 minimum, how about charging what shipping actually costs? Seems like another ploy from Liquidation.com to line their pockets.

Of course, I will not pay $400 of shipping on an order that is only worth $450! But of course, more fine print on their website says that if payment for an order is not recieved within 2 days, they can charge 15% or $200 (which ever is greater) for non payment. Yet again, another way for them to line their pockets. At least this fee would be assesed on my credit card so I can dispute it.

Other Worries

In hindsight, several things about Liquidation.Com should have raised red flags for me.

  • No feedback mechanism for buyers and sellers
  • Little to no way to communicate to the seller about an order
  • Possible shill bidding. After looking at some auctions, the final price does not make sense. Who would buy a pair of two returned laptops for $1400 when they retail for about $1600. Seems like a big risk when the items are potentially defective and sold as-is. I have seen alot of auctions which close at prices really close to retail, which makes me wonder if they are not shill bidding on their own auctions in hopes to instigate an impulsive bidding war. Actually for most of the items I won, the closing price was always at (or close to) my maximum proxy bidding price.
  • Obscene fees such as $400 for the shipping of a 10lbs order from Canada to the USA.
  • Lots of little fine print which essentially either imposes several hidden fees or essentially gives you little to no chance of disputing a transaction.

For a NASDAQ listed company, the details sure look shady. If eBay had such terms, they would have been taken to court a long time ago!!

I am Not Alone Out There

Here is the content of another post taken from eBay forums:

Never trust the bulk auction site Liquidation.com. The only pockets that they like to fill are their own. Angry responses by the people duped by this company are found in many consumer forums and sites across the Worldwide Web. Most come from buyers who made bids in auctions that promise merchandise in good-enough (if not altogether good) condition. What these hopeful people got was a lot less than what was expected. And it is not only the buyers who have reason to complain. There are also a few incidences of sellers being ripped off by Liquidation.com.

If you are a first-time user of Liquidation.com, you will initially be impressed by their “Terms and Conditions” and “Help” pages. They want to assure potential buyers and sellers of what they are claiming as their “credibility.” So what do they do? They put in these dispute clauses in their terms and conditions, and made sure that the answers to the FAQ’s are quite detailed and very well organized. But as you start to avail of their services, you will notice that there are indeed some odd things about the auction procedures in Liquidation.com.

If you look closely at their site, you will find that there is no link or page where you can leave or read comments and feedbacks about the seller and the merchandise. Transactions are pretty much quiet, and in fact, too quiet for comfort. Buyer-seller contact is also very minimal. Everything from registration up to the payment (and most especially the payment) has to go through Liquidation.com. Sounds fishy, doesn’t it?

The only thing that the company is not willing to care of are the shipping costs and the taxes. They do offer arranging and managing shipment and also one hundred percent insurance for shipping, but until now I have not heard of anyone being able to claim any insurance. And I assure you that there are a lot of buyers whose goods have arrived in very bad condition. Perhaps the problem is not in the shipping but the merchandise themselves.

Another bad thing about Liquidation.com’s shipping procedures is their shipping cost calculator. Either the calculator is not updated, or it does not work at all. Or perhaps, Liquidation.com just has the gall to sneakily add extra costs in the actual invoice.

They also rush you for payment. If you do not pay on their demand, they close your account. If you are the owner of a small business with a small capital, and that you were counting on winning the auction you placed a bid on as your  sole means of acquiring merchandise, then you have no choice but to follow their terms. The only one benefiting from the auctions is them.

In my case as a buyer, I received an invoice that proves how much they rip off from both the buyer and the seller. The amount of shipping cost I had to settle was 300% higher than the one given in the Liquidation.com’s shipping cost calculator. I sent an e-mail and got a reply explaining (or making an excuse?) that the shipping cost can vary up to 15% of the total projected cost. They also had the gumption to add that I should be happy about the deal. Outraged but still trying to be civilized, I replied and requested them to review the invoice. I told them that 300% is not 15%. Until now I am yet to receive a reply to that e-mail.

I got so frustrated after waiting for that non-existent reply that I tried calling them. At that time, I was bidding at some 40 plus auctions and I had some 30 auctions set up as a seller as well. I thought that since I have been a good customer, showing them good faith by using their services extensively, I also deserved to be treated with the same courtesy. Obviously, Liquidation.com also lacks in the ethics department.

I had to call several times since no one was answering the phone. When someone finally did, they told me, no, they ordered me to pay or else they will charge my credit card for non-payment and then they will close my account.

I took a deep breath and told them nicely, though with clenched teeth, to please look at the shipping cost estimator again. But what good did it do? None!  All I could do was to stop all my bids and finish the last of my auctions.

Liquidation.com always insists on doing things their way while they neglect to tell you of miscellaneous fees until the last moment.

One seller was instructed to separate his merchandise. His watch merchandise sold a little less than what he expected but they were sold nevertheless. Liquidation.com wanted to charge him $200 or 15% of the sale, whichever was greater for the  watches. Since the watches were sold for $246, the seller had to give the company the $200. Unfortunately the rest of his goods did not do as well. They were sold only for $175. Liquidation.com gave him two options. One was to give them the $175 or to pull off the auction and sell the merchandise elsewhere. The seller opted for the second one. But what the company did not tell him was that by pulling off the auction, he was required to pay $200 dollars as abort fee. What did the poor seller end up with? A huge loss and an even bigger migraine.

Where do these phantom fees come from? Why are not they included in the oh-so helpful “Help” and “Terms and Conditions” pages? The answer is obvious. Liquidation.com presents itself as a company interested in helping small-time entrepreneurs make profit when the truth is that they host a polished high-tech venue for scams and that the only profit they are looking out for is their own.

After what I have experienced and after reading others’ dreadful experiences with Liquidation.com, I have decided to do my part in warning others out there who are thinking of using the company for their own business.

Liquidation.com’s promise of a good deal turns out to be not just a spray, but a very cold shower.

Doing more research, I found more than plenty of complaints online scam sites such as RipoffReports.com...

Now What??? 

Although the experience will vary depending on the individual seller you deal with on their site, you can see from the above information that they are more than happy to facilitate seller fraud and line their wallets with hidden and riddiculous fees!

Scorned buyers and sellers need to gang up! If you have been scorned by Liquidation.com, please contact me. I would really like to compile a list of people's account and maybe gang up to put pressure on them. On my end, I was not hurt too bad (compared to other buyers) so depending on how things develop, I may simply take them to small claims if they are unwilling to cooperate but you would expect so much more from a so-called reputable company that is listed on NASDAQ!!