Consignment - Second-hand Shops

Second-hand Shops

"Consignment shop" is an American term for those second-hand shops that sell used goods for owners (consignors), typically at a lower cost than new. Not all second hand stores are consignment shops. In consignment shops, it is usually understood that the consignee (the seller) pays the consignor (the person who owns the item) a portion of the proceeds from the sale. Payment is not made until and unless the item sells. The consignor retains title to the item and can end the arrangement at any time by requesting its return. A specified time is commonly arranged after which, if the item does not sell, the owner can reclaim it (or, if not reclaimed within a period, the seller can dispose of the item at his or her discretion).

Merchandise often sold through consignment shops includes antiques, athletic equipment, automobiles, books, clothing (especially children's, maternity, and wedding clothing which are often not worn out), furniture, firearms, music, musical instruments, tools, and toys. eBay, drop-off stores and online sellers often use the consignment model of selling. Art galleries, as well, often operate as consignees of the artist.

The consignment process can be further facilitated by the use of vendor managed inventory (VMI) and customer managed inventory (CMI) applications. VMI is a business model that allows the vendor in a vendor–customer relationship to plan and control inventory for the customer, while CMI allows the customer in the relationship to have control of inventory.

Consignment shops differ from charity or thrift shops, in which the original owners surrender physical possession and legal title to the item as a charitable donation, and the seller retains all proceeds from the sale. They also differ from pawn shops, in which the original owner can surrender physical possession and legal title for an immediate payment, or surrender physical possession of the item in exchange for a loan, and can only reclaim the item upon repayment of the loan with interest or else surrender legal title to the item. In the UK, the term "consignment" is not used, and consignment shops that sell women's clothing are called "dress agencies". Although the other types of consignment shop exist, there is no general term for them.