Monday, April 15, 2013

Selling on Consignment: To Do or Not To Do

This topic came up in an Etsy discussion forum this past week. A jewelry designer was recounting a very negative experience with selling on consignment.

She had some of her product in a store operated by a woman she’d known for 20 years. There was no written/signed agreement between them. She did not feel the need for one at this point.

When she went to the store one day to see how her product was selling, she found it closed. The sign on the window said ‘Out of Business’ and the contents, including her stuff, were gone.

After much investigation, she finally learned that the owner of the shop had declared bankruptcy and skipped town. The contents of the store had been auctioned off to pay her creditors.

The unfortunate jewelry designer will not get her product back, nor will she likely ever get paid for them. As you would imagine, she is angry and upset. After all, she is the victim of theft.

So this week, I thought it would be a good exercise to look at selling on consignment...the ins and outs, the pros and cons. In the next few days, I will look at different aspects of moving product this way. It certainly CAN work for you as long as you remember Rule #1...take care of your own interests. Nobody else will.

Next article in the series is here.


  1. I thought selling on consignment the goods were still owned by the maker -- i guess a good reason to have an agreement so if goods get auctioned off the ownership is clear.

    1. This particular situation went wrong in every possible way it could. One good take away lesson must be diligent and thorough to protect your own interests.

  2. That is interesting Bonnie, over here in the UK, we can sell through outlets on a 'sale or return' basis, I am unsure on how that works in a situation like you mention, but I always get a receipt of my goods as well as leaving an inventory with the outlet, I have been lucky so far in that I have never lost stock, but, do have some work in a gallery that are rubbish at getting back to you, its a pain in the neck to keep ringing and emailing them :(