How to calculate liquidation pallet profit and your max bid

The pallet profit formula

Pallet profit is what the goods sell for, minus selling fees, minus everything it cost to get the lot into your hands. The useful question runs backwards: what is the most you can bid and still hit your number? That is your max bid.

Here is the exact calculation the profit calculator runs:

For a spreadsheet, with no processing fee and a buyer the marketplace introduced to the seller, it collapses to:

House accounts drop the ÷ 1.05. Above a $10,000 bid, subtract $500 instead (here's why). Then round down to the bid increment.

ROI means profit ÷ total cost, so a 30% goal means every $100 you put in, your labor included, has to come back as $130 of net revenue. That is about a 23% margin (profit ÷ revenue), not 30%.

Landed cost: everything you pay before the first sale

Landed cost is the full price of a lot once it is in your space: the winning bid plus every fee, mile and hour it takes to get it there.

Divide landed cost by the units you expect to sell, not the manifest count. In the online example below, $728 at the max bid is $12.13 a unit across 60 units, but $17.33 across the 42 that sell. Price against the second number.

Sell-through and unsellables: the numbers that make or break it

Sell-through rate is units sold ÷ units available over a set period, × 100. In the online example, 42 of 60 units selling is 70%. It is not the sellable share (items that work and are complete): sell-through can never beat it.

Budget for the junk too. PalletIQ says to assume 20% of every returned lot is unsellable, Aura suggests planning for 15% to 20% write-offs, and FindLiquidation suggests budgeting 60% sellable on a new supplier's loads.

A manifest lets you price the top lines before you bid; the manifest guide covers when an unmanifested lot is worth the risk. Claims on Two Bro Sales cover shortages on manifested lots (within 48 hours of pickup, 5% of manifest retail or more), not items that don't sell. For what lots close at here, see the price index, published when enough sales exist.

Channel fees: what each way of selling costs

Most channels charge per order, so fixed fees hurt cheap items. For example, eBay's published fee on a $25 sale is $3.80, about 15%.

Three worked examples: online, bin store and wholesale

Each lot below is made up and run through the calculator's defaults for its condition and mode, with a 30% profit goal.

Online flipper: one pallet of customer returns

Open this example in the calculator. Five points less on the resale price drops the max bid to $370: small lots hang on that one guess.

Bin store: six pallets of mixed goods

Open it in the calculator and pick Bin store. The average price per unit carries this deal.

Wholesale: twelve pallets of shelf pulls

Open it in the calculator and pick Wholesale out. At 15% of retail instead of 20%, the max bid falls to $11,000.

All three max bids land between 10% and 13% of manifest retail. That follows from these assumptions, not a rule.

The $10,000 kink: why the buyer fee cap matters on big lots

When the marketplace introduced you to a seller, the buyer fee is 5% of the winning bid, capped at $500, and the cap arrives at exactly a $10,000 bid. Below it, each extra dollar of budget buys about 95¢ of bid. Above it, the fee stops growing and the whole dollar goes into the bid.

So the common shortcut of dividing by 1.05 is right below the cap and too cautious above it:

In the wholesale example, $15,845.38 was left for bid and fee: the shortcut says $15,000, the real max bid is $15,250. House accounts pay no fee at any price, so none of this applies to them.

Set your max bid, then stick to it

Auctions on Two Bro Sales use proxy bidding: you enter a maximum, and the system bids only what is needed to keep you ahead, up to it. Nobody sees your maximum. If you win, you pay one increment over the next-highest maximum (or the starting bid if no one else bid), never more than your own; a reserve can lift it. See the auctions guide.

The calculator rounds every max bid down to the increment at that price: the online example's exact answer, about $463, becomes $460 on the $10 step.

Mistakes that turn a good pallet into a loss

• Treating manifest retail as resale value. You collect a fraction of it, after unsellables and fees.
• Counting sellable as sold. A working item that sits for six months isn't revenue yet.
• Leaving out your labor. If the profit only exists when your time is free, it is a wage.
• Ignoring per-order fees. Fixed fees can double the effective rate on cheap items.
• Misjudging the buyer fee. Know whether you are a house account or marketplace-sourced before you bid.
• Underestimating pickup. A second trip or a bigger trailer belongs in landed cost.
• Raising your maximum mid-auction. The number you set with a cool head beats the one you set with a timer running.

FAQ

What is a good ROI on a liquidation pallet?

There is no standard figure. The calculator starts at 30% after paying for your labor, which leaves room for a bad lot. The are liquidation pallets worth it guide covers the honest trade-offs.

How do I calculate sell-through rate?

Units sold ÷ units you had to sell, over a fixed period, × 100. Track it by condition so your next max bid uses your own history.

What percentage of retail should I pay?

Work backwards from what the goods will sell for, not from a percentage. The calculator shows your max bid as a share of manifest retail; the price index will show what lots close at here once enough sales exist.

Is my max bid what I will pay?

Usually not: it is the most you will pay, plus any buyer fee. Browse live auctions to see where prices sit.