Firms Selling 'Pennies on the Dollar' to Partly Offset Rising Tariffs

As tariffs elevate the costs of imported goods, many companies are turning to secondary markets and liquidation channels to claw back a sliver of those expenses. Retailers, manufacturers and importers faced with tighter margins are moving excess inventory into auctions, bulk resale platforms and third-party liquidators — often accepting “pennies on the dollar” — because other recovery routes can be slow or limited.

Several strategies are in play. Companies pursue duty-drawback claims, a U.S. Customs mechanism that can refund duties when imported merchandise is later exported or used in exported products. Others negotiate supplier cost-sharing, seek tariff exclusions or reprice products where market tolerance allows. Still, when inventory carries carrying costs or seasonal risk, firms often opt for rapid disposal through liquidation partners that specialize in selling goods to value-oriented retailers, international resellers or B2B buyers.

The result: firms recover only a modest portion of tariff-related outlays. Liquidation proceeds rarely match original margins, so the channel is typically used to stem further losses rather than to eliminate tariff impact entirely. For some businesses, the combination of small recoveries from secondary sales and formal reimbursement programs provides a partial offset that helps stabilize cash flow while broader sourcing changes are implemented.

Industry analysts say the mix of responses — from short-term liquidation to longer-term supply-chain reconfiguration — reflects how companies are balancing immediacy and cost. Liquidation clears space and recovers working capital quickly; duty-drawback and exclusion applications can return more value but take weeks or months and come with administrative burden. Meanwhile, reshoring or diversifying suppliers can reduce future tariff exposure but requires capital and time.

Market participants caution that relying heavily on discounted secondary channels can erode brand perception and margins if not managed carefully. Executives are increasingly weighing immediate financial relief against potential long-term impacts on pricing power and customer expectations.

In short, selling goods for pennies on the dollar is a pragmatic, though imperfect, tactic to recoup a portion of tariff costs. It helps preserve liquidity in the near term while companies pursue more durable adjustments to their sourcing and pricing strategies.