Our New Warehouse

Fort Calhoun, Nebraska

LED Lit Rows Under Mez

As luck would have it, I find myself the recipient of another lucky draw on the real estate based poker game. Rewinding, this story starts in 1975 in my dad’s 2 car garage. My first acquisition was with a high school friend and I acquired a pile of hard-to-sell military surplus. I moved from there to my first rental space in midtown Omaha. After 8 years that building sold and I was forced to move into my own estate with “out” buildings. 5 years later I bought my first building of about 5000 SF in downtown Omaha. 7 years down the trail I bought my beloved Kimball Laundry building just up the block.

Kimball allowed expansion into 80,000 SF. I still was not thinking in terms of cubic feet at this point and was still on two dimensions. This is where my luck starts to play a part. After 15 years, Kimball is full. I just acquired a 28 semi-load deal from Power One, the power supply manufacturer. This forced me to either acquire more satellite space or a new building. At the same point in time, the condo market in Omaha was peaking, bringing me a buyer for Kimball that allowed an unexpected profit. I jumped further north in town to a mostly blighted area and bought a warehouse that was built in the 1860’s. High ceilings. Now I thought in a third dimension. How high could I stack it. As it turns out, I could stack it 10′-15′ high and I had about 150,000 SF to fill up.

Ashton Wholesale Building

After another 15 years, not only was this building full but now this neighborhood was being eyeballed for development into something bigger and better. I thought my Ashton building would become apartments some day but other forces were moving and shaping the neighborhood into a creative, cool place to work. Offices. Something to do with the Mastercraft building next door I suppose. Succumbing to trendy developers was becoming a habit, so I sold out.

Surplus Sales of Nebraska – Fort Calhoun

On the downhill path of Grinnell’s lucky real estate arc I stumbled into my current building. It actually has 4 dimensions. Width, depth, height and cool. Since this is my first and last building that will take me into retirement, I needed to make sure I would never out grow it. Here we have 6 million cubic feet to organize and store to the Nth degree. In broad strokes we have 144 LED lit metal shelved aisles, 220′ long and 10′ high. This is for storage and organization of small parts. We also have 20 rows 250′ long of 18′ high double deep pallet racking. This for bulk storage of inventory and unsorted purchases. All lined up to be broken down and added to the website. Add a super snazzy office with expanded shipping facility and you have Surplus Sales of Nebraska, Fort Calhoun.

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42 Years In The Surplus Biz

1975. The Watergate verdict. Minimum wage $2.10/hr. Wheel of Fortune premiered on NBC. And… I started this grand experiment upon graduation from Burke High School. Tens of thousands of sales have been completed over the years and, I am happy to report, it is as exciting today as it was at the beginning.

After 42 years in this business, I have learned a great deal about the Surplus Electronics/Etc., market. Here’s the “Grinnell Mini-MBA lesson” (free online version):

1. Establish a fair sale price for each item.

Mark the price too low and sell out overnight. Mark it too high and buyers are few. The goal is to find the price that will clear out the inventory in a reasonable amount of time, allow the business to recover the initial investment, and keep the lights on.

“Strategic advice for the Surplus Electronics shopper: Buy early, and in enough quantity to see your project through.”

Typically, we buy an item and sell as much as we can up front to defray the acquisition costs.  Depending on demand, we may stride through the majority of the inventory, and then at the very end, raise the price for the last few pieces. Then the law of Supply and Demand kicks in: those last few pieces may literally be the only ones available, anywhere. Strategic advice for the Surplus Electronics shopper: Buy early, and in enough quantity to see your project through.

2. By definition, and in general, Surplus inventory is not replenish-able.

We buy by the lot (usually by the multiple truckload!) and sell by the piece. I have purchased 19 entire businesses in 42 years, and have filled close to 120,000 square feet of warehouse space. The challenge is to be aware of any new opportunities for surplus inventory purchase, while being careful not to duplicate current line items. Product continuity and price points are essential to our business.

3. Each line item, or individual web listing, must carry its own weight.

“An item must earn its place on the website by achieving a minimum gross profit in its lifetime”

At last count, we have about 200,000 Line items. Every item must earn its place on the website by achieving a minimum gross profit in its lifetime. When the value or total quantity is too low, it usually doesn’t earn enough profit to pay for its place in our system. (See my grab bag discussion below). For this reason, some esoteric parts may be priced higher than other similar parts on our website, or elsewhere. In those cases, we likely started out with very low inventory and the item is earning it’s place on the shelf.

Grab Bags are an excellent opportunity to snag perfectly good, NOS (New Old Stock) parts. All of the low count parts that can’t make our website end up in various miscellaneous bins that are used to make our Grab Bag assortments. The value in each assortment is enormous and can’t be beat for adding depth to any builder’s spare parts supply. We are currently developing the Grab Bag section of the site so keep a close watch.

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Most often asked question (for the last 35 years):

“How long will Surplus Sales keep the lights on?”

My answer always contains fragments of my 5-year plan. Now layered into the plan is the eminent shift of use in our North Downtown Omaha location.

New Building

Someday soon, our current 130-year-old historic warehouse will make fine apartment homes and cozy havens for start-up businesses. Maybe a restaurant or two. The massive, ancient, Douglas fir columns and beams, maple flooring and original brickwork, give this building a timeless charm that embodies the essence of Downtown Omaha.

As luck would have it, I stumbled on to our next big thing…. a great new warehouse. It is 6 million cubic feet, compared to 1.5 million on our Ashton Building. We are currently transforming the new building into my ideal dream warehouse. If a warehouse can be sexy, this is it.

Alas, historic Ashton is now for- sale-by-owner (yours truly). P.J. Morgan Real Estate – 1218 Nicholas St, Warehouse, Omaha, NE

The fact that well over 50% of our current inventory has not even made it to the website yet presents Conundrum 33 of my 5 year plan. Will I live long enough. My father always planned to live to see 100. I lost him at 53 years old.

Me at almost 60

While we never know what the good Lord has in mind for us, I know I will be close to my true bliss in this new set up. If I take a little more time along the way to thread a worm onto my hook, or play a game of pinball, just let the phone ring. Someone will always be here to take your order or answer your questions. To learn more about Surplus Sales and to see our warehouse, take a look at this video we created just for you! 

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