In a nutshell, customer returns/salvage goods are typically items that have been purchased from a store but then returned by the customer, but can also be discarded goods in a variety of different conditions. Stores can decide to “salvage” these goods for a number of reasons such as the ones listed below:
- Defective when returned by the customer
- cosmetic blemishes or slight defects
- out of box goods
- missing minor or major components (remove controls, manuals, covers, cables)
- in-store display items
- damaged exterior packaging
- items that the store does not want to or cannot reshelf
- one or more features does not work
- store is overstocked with such items
- out of season items
- discontinued items
Depending on what store they come from and what category of product it is, working percentages on customer return loads can vary greatly.
Generally speaking, the recognized industry average when trying to estimate working percentages is said to be around 65-75% working, 20% repairable, and the remainder throwaway/scrap/parts, etc.
In practice, no individual load or pallet will have that exact breakdown, but these percentages are fairly accurate when describing the average expected condition of the goods when purchasing them regularly.
Ultimately, this is a rough approximation and the actual working percentage on any given pallet or load can be much worse or better.
Note: many stores do not separate ‘returns’ from ‘overstocks’ and it is very typical that a good percentage of their ‘salvage’ loads will be made up of overstocks and shelf-pulls.