Wednesday, September 22, 2010

Consignment and My Experience with it

I do a lot of Consignment (and some of my shops do buy outright from me). Consignment is easy for me. This is what I do...

 1). Shops-- Seriously. I have a phone book in the car with me and as I am driving around- I just stop in. I don't usually call ahead of time- I feel it is harder to say no in person! I generally have a tote in the car with me with items in it. I Always have one of those small photo albums in my car with some of my things in it. I stop- ask to speak to the manager and then show them my photos.. if they like what they see- I set up an appt to bring in real items for a show and tell. If the manager is not there- I leave my business card with my web site/store on it so they can "see" my things. I give them a few days and call them.
If it is not what they are looking for-- It is ALRIGHT. Not everyone will love your things.

2). Consignment rates vary-- and that is okay. But since I do so many shops I try to keep all the prices the same- or a dollar or 2 different. My goal is to sell- you can't do that and undercut yourself at another shop. I want the shop owner to be happy. So... while one might be 100% commission-- another might be 25% commission. I price accordingly. So- that means with one I make more than the other. I always make a profit. And I take into consideration the items I sell online too. Online- they have to pay shipping. 
     ** The thing with commission is-- and Most shops do it wrong- you can ask an accountant for a better explanation. To get a consignment rate- you multiply into it.. to back out of it-- You have to divide out.. Most shops subtract the % out-- which is wrong and you will never get what you wanted. (it only works correctly with $10.00). So watch that.

3). I have a 2 part 8"x11" receipt book and I list all my items there. I keep a copy and give one to the shop. That way we all know exactly what is there. An Inventory sheet. For me it works to have a control number on each item.. the shop will probably also give you a shop number or letters or just your initials.

4) I provide my own price tags. The shop should not have to pay to put blank price tags on my things. If I know the commission ahead of time. I write it on the tag... otherwise the shop does it. My price tags have my business name on it, washing instructions, the fact that my home is smoke free etc. No phone number or web site (see item #13).

5) Find out how often they pay you. Some of my shops are very organized and pay monthly-- some pay whenever- and I am ok with that. As long as I have the current year sales in the current year- I am ok.
   But some of you would not be ok with it. (I am here to make money- But my circumstances do not rely on my shop sales to survive- so I can afford to be laid back).

6)-- VERY IMPT-- In NYS--(not sure about other states). Make sure you get a signed form ST-120, signed by the shop.. This shows that they are paying the state sales tax and in case you are ever audited-- You have it on file that they are paying the state sales tax. You both do not need to pay the state sales tax for the sales. (which means you would have to have a state sales tax number).

7) If the shop is handing you back the state sales tax- then  you don't need that form signed- But you do need to keep track of it as you will have to pay NYS with it when your tax is due.

8) Bookkeeping is very important. I use Excel myself and I have a paper version in case my computer crashes. There are a lot of programs out there to use. Just make sure you have a backup for emergencies.

9) I signed up a new shop today and they wanted me to sign a contract. Read it over. They are usually pretty standard. Discuss what to do about shoplifting. Are you out the item? or do they pay you for it. Now some of my shops- pay me 1/2 price for the item- which is nice- Normally- I find that you just loose out. (I have to say I have never lost anything to shoplifting). My things are not all that pricey. I guess if you had super pricey things- then you best get your own insurance to cover things.

10). The shop today wanted my SS #. I did not give it to them as I am not comfortable with that. They said they needed it if I sell more than $550 in a calendar year to send me a 1099 form. I said-- we would cross that bridge when we came to it. They were ok with it. We have each other's NYS sales tax numbers.

11) I hope everyone knows to be courteous and polite. It is their shop and if there is something they don't like-- Don't get your feelings all in a wad. Don't be mad or upset. See if you can make it in another color for them. And if not pack it up and take it home. There is NO Place for hurt feelings.

12) Make sure they have your home address/ cell/ home phone/ email.

13) Here is another BIG one.... You should not be contacted by customers from that shop... I don't expect to be. I told them that. Any orders come through them-- They get to make money off of me. I am not posting my business card at that shop. Sure- my price tags have my business name on it and anyone can do a google search with it and come up with me. I explained that to them.. If anyone mentions to me that they saw something at that shop and want one like it.. I would refer them to that shop as they are handling the sales. But I also told the shop if someone finds me on a city street and wants something- they are fair game and mine.
I am not out to mess with my shops. I like doing consignment and they like me. It works for me. I enjoy getting monthly checks and not having to do a craft show.

14) I make sure my shops are not in the same town. Or if they are they have different decor. I do have 2 shops across the street from each other- they know that I have my things in each other's shops. I price things so they are the same- even though the commission is different. One is very Prim and the other is Northwoods. Honesty is the best policy.

15) Check with the owner how often to return. Everyone is different. Most of mine I get to monthly. Some I wait for a call. Some I have to get to every week or so since they sell so well.

And just have fun with it. For me doing shops is a good experience. I enjoy it. I am very friendly with my shop owners and stay and visit with them. With a lot of them we have exchanged emails and I am in contact with them on a friend basis. There have been shops that just do not sell very well at all and I have removed my things from them. That is OK. There is another shop around the corner. I am pretty easy going. I have heard of people with bad experiences. I don't know what to say about that- it is not my experience.

Come share your thoughts....


  1. great advice! thanks for linking up yo a crafty soiree last week-- we'd love for you to join us again tomorrow
    ps i am your newest follower

  2. heya, we are even cos i can crochet but man u sure can quilt!!and i cant even use a sewing machine, thanks for stopping by ;)

  3. Awesome, well thought through post! Thank you. I hope to start making items to sell in my local market within the next year and your advice is truly valuable.

  4. Hi!
    Thanks for all the wonderful information! I am not selling things yet, but it's only a matter of time:)

    Your dogs are gorgeous!

  5. Some wonderfull info for eny one thinking about working with shops, that is very generous of you to share your experience.

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