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Consignment fee seems really nuts.. or is it me?

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Forum topic by cmonSTART posted 1725 days ago 19851 views 0 times favorited 38 replies Add to Favorites Watch
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cmonSTART

12 posts in 2034 days


1725 days ago

So long story short I have a chance to sell some things in a consignment shop a friend and her business partner have opened (just opened yesterday). Her partner who I get the feeling is in charge of the fees and such said they sell on consignment with 50/50 terms (50% to me, 50% to the shop). I have no experience with selling on consignment but this just seems nuts to me. Really nuts. The woodworker will always come out on the losing end with this.. big time.

So, typically what are consignment terms for you folks? Does this seem nuts to anyone else or is it me? It’s a new business so I don’t know if this is how it is or ignorance on their part with their fees.

They have no other craftsman selling there right now. I would be the first. It’s mostly goods the business owns.


38 replies so far

View khop's profile

khop

134 posts in 2273 days


#1 posted 1725 days ago

cmon, I think they are trying to run you off. The max I have heard for fees is around 25% If they insist on selling your stuff, bump up your initial cost to cover the difference. I don’t know what projects you want to sell, but DON”T cheat yourself. Hang in there.
KHOP

-- How am I doing? Better than I deserve. Dave Ramsey

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Dragonsrite

136 posts in 1994 days


#2 posted 1725 days ago

The rate I’ve always heard here in Minnesota is 20%

-- Dragonsrite, Minnesota

View Dez's profile

Dez

1113 posts in 2674 days


#3 posted 1725 days ago

I feel that their prices are way high also. A coop here in WA has lower fees than that and they are very high end, with approval from the members before they will even consider your stuff! If I remember correctly the fees are in the 30% to 38% range. I agree that you shouldn’t sell yourself short. Let them deal in 2nd hand junk, er I mean stuff.

-- Folly ever comes cloaked in opportunity!

View a1Jim's profile

a1Jim

111999 posts in 2174 days


#4 posted 1725 days ago

Depending on your area studios that sell furniture and art usually get 40-60%

-- http://artisticwoodstudio.com Custom furniture

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Timberwerks

301 posts in 1758 days


#5 posted 1725 days ago

The galleries I sell through get 40% for pieces over $500.00 & 50% for items under $500.00.

-- http://djofurnituremaker.wordpress.com/ & https://www.facebook.com/pages/Timberwerks-Studio/126415221682

View papadan's profile

papadan

1115 posts in 1966 days


#6 posted 1725 days ago

Around here the fees run about 20% for crafts or new items and 40% for used items like furniture and clothing. But Antiques go with the crafts at 20%

-- Carpenter assembles with hands, Designer builds with brains, Artist creates with heart!

View cabinetmaster's profile

cabinetmaster

10874 posts in 2155 days


#7 posted 1725 days ago

Wow. And I have never paid over a 10 to 20% fee.

-- Jerry--A man can never have enough tools or clamps

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okwoodshop

442 posts in 1772 days


#8 posted 1725 days ago

I thought about trying to sell through some of these but the rates always ercked me. I understand that they have overhead and there time is worth something but come on. the wood worker foots the bill for materials,design,construction,etc. they transport to the store. the store sets them up and if they dont sell you have to go pick it back up. they want as much to set in the store as we are supposed to get for all the work and risk??? I’m sorry, that just don’t sound right to me. luckily I have a large family who are more than happy to take what I make for free LOL. I was approached by a friend of the family who was starting a consignment shop and asked if I wanted to put some things in it at 50%. I politly told her I would consider it at 25%. She refused and said I could just raise my price to make up the difference. I didn’t want the reputation of being overpriced so we couldn’t make a deal. I did visit her shop once (before it closed) and couldn’t believe the prices she had on her items. sorry to ramble on but this really sticks in my craw. P.S. we have a local sales place on the net. that lets you advertise for free, kind of like craigs list but more local. It’s great for occasional selling of low end items.

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cmonSTART

12 posts in 2034 days


#9 posted 1725 days ago

See, I was thinking around 25% would be about normal.

Say I get paid 50% of the sale price which we’ll call $200. That means I get paid $100. If I paid $50 for materials I’m making $50 from the sale and the shop is making $100. No way.

The way my pricing usually works is Materials x 2. So, I would make $0 and the shop would make $100. Even more no friggin way.

I could bump the price up but that reduces the chances of a sale.

View okwoodshop's profile

okwoodshop

442 posts in 1772 days


#10 posted 1725 days ago

cmon, keep an eye on this place and see what kind of business they do, I’m betting it won’t last long without some changes.

View poroskywood's profile

poroskywood

614 posts in 1961 days


#11 posted 1725 days ago

I was doing 70/30 I thought it was a little steep but…. I told them what I wanted and then they put their 30 on top of that so in the end I got my bottom line. Somethings sold and some things were to expensive to sell. That about sums up consignment shops. If they don’t like YOUR terms to bad. They could be seeing how desperate you are, trying to make extra from you being desperate to sell something.

-- There's many a slip betwixt a cup and a lip.--Scott

View closetguy's profile

closetguy

744 posts in 2489 days


#12 posted 1725 days ago

I would never consider consignment unless it was a very high dollar piece in a gallery. This subject was heavily discussed in this thread a while back http://lumberjocks.com/topics/6236.

-- I don't make mistakes, only design changes....www.dgmwoodworks.com

View Peter Oxley's profile

Peter Oxley

1426 posts in 2472 days


#13 posted 1725 days ago

The shops around here charge a monthly fee for displaying items (usually about $50/month for 10’ of wall space), plus 30-40% of sales. I get frequent calls asking me to consign items, but I’ve never done it.

-- http://www.peteroxley.com -- http://north40studios.etsy.com --

View SteveMI's profile

SteveMI

845 posts in 1892 days


#14 posted 1725 days ago

I had a booth in a split antique and crafts place, pretty good size at 24,000 sq ft. It was 3’ by 5’ for $90 a month with six month lease. Then the store took 10% of sales. Antique side was well monitored, but the craft side was at least half China buy-sell stuff. One of the managers gave me the talk about how they had to keep the floor space filled or customers wouldn’t come. I couldn’t compete with the China prices and left after 6 months.

Actually some of the more quality China stickered stuff faccinated me in how they could have a final retail price so low when even at my best could not buy the materials for that. And they had shipping!

One of the owners saw that I did woodworking and asked me if I could make tables as they were a fast moving item that they wanted more variety in. At first I wasn’t interested and then decided to take a stab at it. Made a very basic hall table without a drawer and took it for review. Owner said they could sell it at $29 and they would take 40% as consignment fee. So, $17 dollars for labor, materials and profit? Would need to find a bunch of free pallets just to break even.

They did have bigger tables with drawers that were obviously local made for $99 a little bigger. I say obviously due to the router marks and pine construction. Buy they had multiple drawers and larger tops, which would drive the labor and materials up. I didn’t want to make anything at that grade or craftsmanship and didn’t know if the market would bear an increased price.

Steve.

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bornagainresale

1 post in 1725 days


#15 posted 1725 days ago

I own a resale & consignment store. It sounds like these new biz owners are unfamiliar with how consignment should work for what we call an “Artist Consignor.” Regular consignment rates are usually in the range of 40/60 to 50/50 for gently used items. But for someone who is producing/crafting/constructing pieces themselves the rates need to be different. I did a LOT of research before I picked up any Artist Consignors. I found the range of normal rates to be 25-45% for the store to keep. We set our rate at 30%. Obviously, the Artist needs to be able to recoup their investment and make a bit as well.

Keep in mind what the store is providing to you. It is larger than just the sale of pieces. Yes, you could probably make more per piece selling on your own at craft shows or through word of mouth. However you will also benefit from the exposure. When the store pays for their advertising, whether they specifically mention your pieces or not, you will benefit from that at no additional expense to you; it draws people into the store which means more eyeballs seeing YOUR product.

There is the matter of sales space, as well. I know exactly how much money each square foot of selling space makes for my store each month and every inch is precious. Space is always a challenge and I will not waste it on unproductive or unprofitable product. If I cannot make enough on something to justify taking up space the product is discontinued in short order.

In addition, you have a skilled sales force working for YOU on commission…if you don’t make money, they don’t make money. I’m a good salesperson (it’s what I love) and I train my people well. While my Artists are busy with their families or making other pieces we are busy selling their pieces! They get to focus on what they do well and we focus on what we do well, and that benefits both parties.

I’ve worked hard for the past five years to establish a stable, large clientele that have come to know my store as a unique place carrying local product at reasonable prices. If your product is added to my store’s product mix you are guaranteed exposure to clientele you probably would not have access to otherwise…that’s thousands of “hits” per month, to put it in eBay store terms. You benefit from my advertising (radio, print, tv, email), expertise (display, salesmanship), location & clientele (no overhead for you, established client base), and equipment (signage, displaying fixtures, credit card machine/Telecheck, invoicing, collection of funds at no charge to you), all for that 30% fee.

All that to say, maybe do some research on your own and print some sample Artist Agreements out to show to this consignment store. Or maybe this particular consignment store is not the right fit for your product and you need to shop around.

Best of luck in whatever you decide!

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