What is consignment?

Many secondhand shops don't just sell their own items. Often people can also bring their own clothes or things to the shop. The shop sells them for them and gives a percentage to the person that brought them. That's called consignment.

The consignor

Someone who has their things sold in your shop is a consignor. The things stay theirs until someone buys them. So you pay nothing up front. That's the big advantage for a shop: a full shop without spending money on stock.

The percentage

When something sells, you and the consignor share the price. How, you agree up front with a percentage. Many shops give the consignor between 30% and 50% of the price. The rest is for the shop.

An example: a coat costs £40 and the consignor gets 40%. Then the consignor gets £16 and the shop keeps £24.

The balance and paying out

The consignor doesn't get the money right away with every sale. Every sale goes to the consignor's balance: the amount you still owe the consignor. You pay that out later, for example once a month, in cash or by bank transfer.

A good register system keeps that balance for you. Otherwise you sit at the end of the month with a notebook and a calculator.

What doesn't sell

Also agree on what happens with things that haven't sold after a while. Many shops keep something two or three months. After that the consignor picks it up, or it goes to charity. Put it on paper, so there's no hassle later.

Do you sell your own things too? That works fine next to consignment. Those items have no consignor, and the whole price is yours.