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Clean out Your Closets and Make Money - Consignment - A Quick Guide 
 
by Cyndi Allison July 07, 2005

Negotiating in the World of Consignment

In order to discuss the working consignment relationship, it’s important to know the particulars of the shop and the workings between the consigner and the goods providers. Most consigners should be able to provide a contract and a guideline sheet. Look these documents over carefully. Understand how the system is set up and the expectations from both the selling and buying end. It’s better to know ahead and up front than to be surprised or disappointed down the line.

Most smaller, hometown consignment shops work on a 50/50 (or close) split. Though that may sound like a big cut, remember that the shop owner is the one doing the marketing and keeping up with the business records. The shop owner also carries the overhead like space rent and utilities. He or she has financial commitments and can’t work for you unless these are met.

Some of the online-oriented consigners work for smaller pieces of the income pie. A number of Ebay companies take in items and then market online. With the reduced overhead, it may be possible to look at seller cuts closer to 75% of profit. Typically these arrangements involve the bigger ticket items and also some moving fees to get items to sellers or to the direct buyers.

Though working with a consigner means much less time spent on the sales end of the resale process, it still involves (or can involve) some negotiation. Things aren’t set in stone. For example, a shop may offer a 50/50 price split but may be willing to take a lower percentage if you’re offering good quality items and in bulk. If you’re presenting a high end corner hutch that the owner knows he or she can move, it may be possible to get a higher than standard percentage of the profit. Many owners will go with something more in the range of a 70/30 split in such cases—but only if negotiated ahead of time.

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