I’m not exactly sure what to call the companies that match buyers and sellers of surplus/used goods–especially of the capital variety.  They really are marketplaces, but having lived through the original “marketplace” era, I find it hard to choke out the “M” word with a straight face these days.  It seems like the sexy term is “reverse logistics”.

Then there is the issue of what to call the items they sell:  are they “surplus”, “used”, “secondary”, “pre-owned”, “salvage”, “legacy”?  But whatever we decide to call these reverse logisitics marketplaces, it has been a busy time in the sector, which is now rapidly consolidating.

Liquidity Services (LQDT), which I have written about previously, acquired a surplus goods (excess retail merchandise, that is, not used stuff) company in September and their stock increased quite a bit.  This week, LQDT announced they acquired one of the early players in the space: Go Industry/Dove Bid, which, believe it or not, was public in the UK.  LQDT’s stock went up again.  Indeed, LQDT stock has been on a tear over the past year, moving from $19.50 to over $65, now sporting a market cap of $2 billion! (No, I don’t own any. I claim to be observant, not smart.)

Ritchie Brothers (NYSE/TSE: RBA), the grand-daddy of offline surplus asset auctions announced, today, it had bought AssetNation a long-time online player in surplus assets, for $64 million.   Capital Asset Exchange, which the all-knowing folks at TCV pointed out to me,  claims on its website that it has grown from $1 million in 2008 to $120 million now.  I’ve also heard good things about Iron Solutions which specializes in the surplus farm capital equipment sector.

There are plenty of other surplus assets or reverse logisitics marketplaces in IT and elsewhere, but the battle in the capital goods sector is shaping up to be a doozy.  Perhaps Ritchie, Liquidity Services, and CAE will end up being the three eBays of the B2B sector, or will there be only one eBay?

At some point in the future, I’ll dig deeper into these businesses which are fairly easy to study given that they are public and the marketplace model is now well understood.  A critical factor is to look at the growth rate of Gross Merchandise Value transacted and the margin that the marketplace extracts.  eBay extracts about a 9% margin on GMV, for instance.  PayPal is another 3.5%  for the payment piece.

The bottom line is that there is a lot of money in matching buyers and sellers of very unique used B2B goods, just as there is in collectibles!  And just like eBay, or even more so, these marketplaces can add insurance, payment, shipping, escrow, inspection, and financing and make even more!  Treasure from what might otherwise be “trash”.