Consignment Agreement: Ten Things to Check First

The ten points

1. 1Ownership. Title should stay with you until the item sells. That is what makes it consignment rather than a sale.
2. 2Insurance. Because the goods remain yours, they normally remain on your insurance. Confirm it with your insurer before anything moves.
3. 3The rate, and what it applies to. A percentage of what, exactly, and taken at which point.
4. 4Fee order. Platform fees off the top first, then the share, is very different from a share of the gross with fees charged back to you.
5. 5Up front charges. Entry fees, lotting fees, photography, cataloguing. Any of these can outweigh the commission on low value goods.
6. 6Storage. Whether it is charged, from when, and on what.
7. 7Postage. Who pays it, and whether it comes out of your money or the buyer's.
8. 8Unsold stock. What happens to it, who pays to move it, and whether it can be bundled to clear.
9. 9Reporting. What you see, how often, and at what level of detail.
10. 10Settlement. How quickly you are paid after a sale, and what the statement shows.

The three that cause the disputes

In practice most consignment arguments come down to the same three points, and all three are avoidable with one sentence each.

Fee order is the first. A share taken before platform fees and a share taken after are materially different numbers, and on thin margins that difference is the whole profit. Get it in writing which comes first.

Unsold stock is the second. If there is no agreed answer, the default tends to be that it sits somewhere accruing a storage charge, or comes back to you at your expense. Neither is what you signed up for.

Reporting is the third. A single figure at the end is not reporting, it is an assertion. Per pallet or per item detail lets you check the work and tells you what to send next time.

The manifest question

Item level manifests sound like the gold standard and are usually a bad trade. Manifesting a mixed pallet properly takes hours per pallet, holds the stock up for weeks, and that labour comes out of the money somewhere.

Pallet level reporting gets you the useful information, which is what each pallet cost you and what it made, without the delay. We report by the pallet for exactly this reason and say so plainly rather than promising item level detail nobody could deliver at speed.

The one question that shortcuts all of it

Of every pound a buyer spends on my stock, how many pence reach my bank, and when. If somebody cannot answer that in a sentence, the agreement is not clear enough yet.

Our own answer is on the consignment terms page: platform fees come off first, then our share, and you keep 50 percent of anything selling under 20 pounds, 60 percent from 20 to 100 pounds and 70 percent over 100 pounds. No entry fee, no minimum, no storage charge, and nothing comes back to you unsold.