The allure of free inventory is all the effort from sourcing is gone, there is no costs of goods, you earn 100% profits. It's hard to withsand for a beginner reseller that allure, it's recommended starting out to sell items you already own or donations to grow captial and use that income to source higher profit items.
You get better at listing and photographing. Items start leaving and you feel this weight lift as you let go of some of the things you've convinced yourself you needed for so long. Some afternoons are spent crosslisting, if you cross list. You're out there sourcing. You answer messages about the items and feel proud you ship fast and package with care and do the best for your customers. You start to tell your friends and coworkers what you do. You ask yourself, how can I do this without having to source and it coming out of my pocket?
some friends and family might ask you to sell items for them, splitting the profits 50/50. So you agree, because why not? But as list you start to feel like you are doing all of the work. Unfortunately, the beanie babies from your mom's collection aren't worth a ton. It seems like you're working hard for nothing. This is the sensitive topic of consignment, one of those ebay questions that floats around. Have you ever sold items for your friends or relatives? How much should the commission be? And Is it safe to mix business with the people you care about the most?
Before I talk about my personal story, let me explain what consignment is.
- The party that sells the goods on consignment receives a portion of the profits, either as a flat rate fee or commission.
- Selling via a consignment arrangement can be a low-commission, low-time-investment way of selling items or services.
Plato's Closet and Buffalo Exchange is a consignment shop model, where they take in your very gently used, practically new items and give you 30-40%.
for your friend it's a great way to make money on items if you don't have the time or they were donating it. The key to successful consignment is the arragngement which should involve your time.
I asked Dickons Pickons during one of his lives who sold items for his family before but does not dabble in that and makes a great point.
"when they find out you sell items on ebay, they automatically assume you list it and it sells.... they are not in it for the waiting game.... rather than getting the items on consigned to me I would just buy them flat out. that way they can take w/e lentgh of time to sell, or if the item gets returned...i just avoid it and tell them that ebay is very easy to sell on."
Returns wasn't something that crossed my mind but like some of you, I'm a beginner. And if this wasn't one of my good friends, I would politely turn them down. Returns are the risk you take if you cosign and sell online.
If you do cosign, is 50/50 fair? How long does it take for you to list an item and what is your time worth? Time is money. You need to decide if your fees will come out of your 50% - or whatever you earn from each sale. Some sellers use a flat rate fee while others use a tiered system.
ReCloth Collection describes sorting items from what she will take and what she will take to buy sell trade stores. While making a spreadsheet for the new client's inventory she figures out what she will prices items at. A lot of times things don't sell what you price it at, so to compensate she takes the initial price and takes 25% off, also at this time estimates what the fees will be and this is the price she tells her client.
based off that estimated after fee price, i put in my payout percentage, based on what it sells for after fees and that's what they get for their payout. i take my consignment percentage based off on the after fee amount not for the actual listing selling price.
Whoa, that's a lot of logistics that come with consignment. But if you do need inventory and have trouble sourcing like in my position then the consignment method could be for you. alot of it was not good stuff but the knowledge that has come with this so far has been great. In my personal position, it's it behooves me to do this in my store and who better to get my feet wet into consigment than with my best friend? But is my shop ready for consignment? Am I ready to confront my best friend with my terms?
doing research on this topic of consignment i stumbled across story about how an autioner turned $157 into 4.4 million on an art piece. But get this, the elderly couple decided to sue the seller.
(summarize article)
How do you determine what's fair? Think about all t he work it took for the seller to get this piece authenticated. He took it to 3 different experts, that obviously took a lot of time and research. And even the experts undervalued the market price, who could've guessed it would've sold for 4.4 million? It was also a special auction. It got me thinking about the consigment method, would this lawsuit have been avoided if they had come upon an agreement? And that's also suspecting foul play, what if the auctioner just had a hunch it was worth something more.
Like other booksellers, I find books for ten cents and sell it for 40 bucks, but that's a good sale! most books I get for free or pay less than $1 and sell between $7-$20. Sometimes I tell someone what something is worth because I don't want them to feel robbed when they do find out later it sold for more than what we are asking, most likely not doing the homework, not understanding the assignment.
the seller offered to pay them basically the amount he was told by the experts, a settlement that the elderly couple declined. the couple claim that the auctioner had prior knowledge to the true worth of the item, and it looks sus that if he didn't think it was worth anything, why did he go through the trouble of seeking experts in Afrigan masks and carbon-14. the couple also alleged that the auctioner conspired with the gardener, who he ended up giving some of the proceeds to.
(insert a photo of game of thrones garden where everyone always plots)
The defense argued that the dealer “is a second-hand dealer and not an antique dealer and cannot be considered an valuation professional. He has no knowledge of African art.” They added that he sought the expert assessments at the initiative of the auctioneer, not because he had reason to believe it held greater value.
Curiosity is so important on this job. I couldn't help but wonder what would've happened if they had done a consigment agreement where it was 50/50 where the amounts were in the millions.
In Consignment Chats Podcasts episode 129 Can You Sell My Stuff How to Know Your Terms of Consignment two important questions you need answers for when your beastie asks you to sell their box of kids toys. One decide how much the comission is, and tied with that is what are you willing to take. It's hard to say no to your friend, it's HARD. that bad taste in your mouth is why you don't mix business and friends.
https://podcasters.spotify.com/pod/show/consignmentchats/episodes/Episode-129--Can-you-Sell-My-Stuff--How-to-know-Your-Terms-of-Consignment-in-2023-S3-E25-e25vra6/a-aa1e53m
I highly recommend this podcast, they have so much information and experience in this one episode and it was fun to listen to, I ended up binging two episodes after that one. they were also on an episode of Reseller Showdown from I'd Flip That, another channel t hat's entertaining to watch they have fun reseller games and cool guests.
I was able to confidently create my own consignment business model. This would benefit my shop because I do not drive and even inspired me to ask shops to have my books for sale, the same way I cosigned my crochet apparel back when I was on Etsy. I think if you set up your shop for consigment, it could be profitable and a great way to connect with your community.
But what do you think, is it a bad idea? I'd love to hear your thoughts on consignment, would you do it, tell me your personal stories and why you don't if you don't, and why you do if you do. And if you enjoyed this kind of content from my channel, please subscribe and like. I'll talk to you soon!
think of what you will take in, and think of the minimum amount you'd take, i love learning new things
no - i EARN not take.
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