I Want to Stop Consignments

by Shawn McVey.
(Sacramento, California USA)


Thanks so much for your insight on consignment.

I’ve been making jewelry for at least 20 years. I sell  in boutiques myself (no rep involved). What I’ve noticed is store owners will only do consignment with local artisans like myself vs. buying the jewelry wholesale.

However, they will buy wholesale from brand names that are manufactured in China.  I have a system and policies in place, and a proven track record with these stores that consign my jewelry.

I now have a high end boutique that has sold a lot of my jewelry, but is now delaying to pay me. I’m so frustrated with the whole consignment scenario I’m ready to tell them I’m pulling everything out of their store.

I have a lot of customers in stores who request my jewelry too, so I know people actually like it.

How can I change from consignment to having retailers purchase my jewelry outright?

It would save me a lot of headache.

Shawn McVey
California Girl Designs Jewelry

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  1. When a retailer wants to offer me consignment, I make a counter-offer: Outright purchase at wholesale prices and volumes with a 6-month buy-back. This gives the retailer an out if the items aren’t selling, and guarantees fresh stock twice a year. For the manufacturer, it means the retailer is going to be more selective about what they want in their store, focusing on stuff that will sell instead of filling the shelves for free. This also puts the onus on the retailer to control loss and damage, as opposed to the manufacturer eating any losses.

  2. Hi Shawn, you may need to find some new shops / galleries / boutiques to work with.

    Who is your targeted customer (the end user / wearer) – and where do those people shop? Also, where would people shop if they wanted to purchase a gift for that end user?

    And what other businesses would your targeted customer frequent?

    Depending on the customers you’re designing for, you might consider looking into retailers like upscale clothing boutiques, gift shops, resort gift shops, etc.

    Once you pinpoint some ideal places where your customer is likely to shop, you can contact those businesses to show them your work and present them with your wholesale pricing and terms.

  3. I’m with you, Shawn! I have had mostly dismal experiences with consignment. The problem is that the retailer has no “skin in the game.” They haven’t spent anything, so there’s no incentive to sell your handmade jewelry, vs. the stuff from China.

  4. I love the approach Jerry Penner uses (above.) Thank you Jerry. I have had mixed results with consignment and have learned several lessons. The biggest is to keep an inventory and to make sure your consignment shop is aware. I let them know that I will check the inventory every 60 days and I will rotate older jewelry (over 90-120 days) to give a fresh look to their customers. This actions and words puts the shop on alert that I’m watching things. So many jewelers love to make, but don’t want to do the ugly paperwork and some shops take advantage of this.

    This inventory keeps me aware of payments and if they start to slow down. That’s when I put them on the watch and chat list. I have been stung and stung well, because I wasn’t watching the payments and inventory. As soon as a payment is late I shoot them an e-mail to make sure they know ‘I’m watching!’ I have pulled out of shops for slow payments, no payments and small sales. I nicely stated that I buy my groceries with their sales and unfortunately can’t afford to continue and wish it were different.

    Good luck with you sales and please don’t be discouraged. There are some awesome and successful shops out there! Once you have them your jewelry business gets easier and easier. In the meantime, I’m going to try Jerry Penner’s approach with future shops.

  5. I hate consignment. Note that I did not say, “consignment sales.” I noticed back in the day that I was part of a artist’s gallery that if I were on the floor that day, the store had a very good day; several different artist’s pieces were sold, including my own. If someone else had the floor, sales were poor, I almost never had a piece sell, and if anything sold, it was that person’s work. Hmmm. Coincidence, of course. 🙂

    The decision you need to make is whether you want to tie up several of your pieces on consignment in hopes of a sale, or look for a store where they actually pay for what they choose.

    I would tell the shop that carries your pieces on consignment that you are changing your policy and no longer can do consignment sales, but would be happy to give them priority in purchasing your pieces outright. Since they already know your record of sales, they should not need a buy back agreement. They already know what sells, and should make their decision accordingly.

    Keep this thought in mind. A piece on consignment is not a sale; it is only advertising.

  6. Hi, like Shawn and many of you I have had mixed results with consignment and am trying to move towards wholesale. I have one account that buys a considerable amount at wholesale but then also wants to trade back pieces that don’t sell or are out of season. So, in essence she is consigning at wholesale prices. She has done this twice and she might trade in $70 while buying $200-400 new so I definitely come out ahead but I feel as if I am being taking advantage of. I feel like the next time she asks I might say “I’m wondering if consignment might work better for you since you like to change up inventory frequently?”. Or should I just continue as is since she is buying and selling at a good rate and it would be better not to rock the boat?? Thoughts?

  7. Cebette, you may have already thought of these suggestions:

    Can you pinpoint what styles / sizes / lengths / colors / price points of your jewelry seem to sell best for this shop? Maybe keep supplying her with similar pieces to what she has sold for you?

    Or could the shop owner provide you with a sort of profile of her average jewelry-buying customer? That would make it easier for you to provide jewelry for that audience.

    Those strategies might help reduce her tradebacks.

  8. Thanks Rena, I have already done the things you suggest and in fact have specifically created pieces for her shop in response to her feedback. It really seems to be that she just changes her mind or if things don’t move very quickly (we’re talking weeks, not months) she wants to trade them for more current stock. I guess I just need to decide if this is acceptable or not. Appreciate all you do! Cebette

  9. Ann Wittman says:

    I’ve enjoyed all the comments and have pieces in two shops by same owner.
    I don’t know what’s normal but she is marking up my pieces 3 x and very little has sold lately. I think when she opened, she just wanted to fill shelves and used my art for that purpose. Now, after 3 yrs, she is filling shop with other imported items. I am now allowed 2 shelves and some of my pieces have come up missing. I think it is time to re-think the whole business.

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