GARLAND — The gifts keep giving at a Garland warehouse where thousands of unwanted Christmas presents end up.
"It's still packaged just like it is brand new," said Mo Sayegh, with Liquidity Services Inc., as he lifted a blender out of a bin inside the company’s sprawling 100,000 square foot warehouse.
The top of the box was open, but the appliance otherwise seemed brand-new.
"It'll end up being somebody’s great after-Christmas bargain," he said with a smile.
With retailers facing record holiday gift returns, many customers don't realize their unwanted gifts rarely end up back on store shelves.
The National Retail Federation estimates holiday gift returns will total a record $46 billion in 2011, up 4 percent from the previous year. Many of those returns will find their way to Sayegh’s warehouse.
"We’re expecting almost a 50 percent jump in our inbound volumes from what we saw last year," he said. Sayegh said it's often too much work for stores to ensure returned merchandise does work and then re-stock it.
"It’s a risk of, 'Is it perfectly good?'" Sayegh asked, adding that many companies don’t want to risk damaging their reputation by reselling returned goods that may be damaged.
"They can’t send it back to a vendor," he said. "They've got to send it to a liquidator."
Seven of the country's top 10 retailers — including America's largest, Walmart — unload their excess inventory at one of four Liquidity Service warehouses across the country.
Workers in Garland then unpack, sort, test and later re-sell the products at a public online auction site, liquidation.com.
The company says its merchandise often sells for 60 percent less than at stores, but the products are always sold in bulk.
A recent online search found a pallet of five 32" to 47” LCD HD televisions selling for a total of $994. The retailer often gets a cut of the final sale price.
Darrell Johnson has found the deals irresistible. After being laid off from his IT job, he started shopping the liquidator’s Web site and then reselling the products on eBay and Craigslist.
"You can make more money doing this, as far as on your own time with fewer hours," he said after arriving at the warehouse to pick up a box of computer games and cell phone chargers he hopes to sell for $500. He snagged the box online for $150.
"That was a good day," Johnson said.
What warehouse workers see in January and February often indicates what was popular in the past holiday season.
For the first two weeks after Christmas, 5,000 iPads came through the company’s Garland warehouse. Technicians unpack each tablet to ensure it still works and then erase any personal information.
The company has no say in what the retailers deliver. Items range from televisions to bleach to hot tubs.
"You'll have the cereals next to kitchen items next to home improvement," Sayegh said. "Why would you go buy full price?"