Consigning your Luxury Items: Is it Worth it?
Consigning luxury items has become a significant trend in the luxury resale market. A process that allows individuals to sell their high-end goods—such as designer handbags, clothing, and accessories—through third-party platforms or stores, consignment promotes the reuse of items, reducing waste in the fashion industry.
This article will explore the pros and cons of consigning so that you can make an informed decision when determining whether consignment is right for you. Knowing what to expect can guide your choices for resale in the luxury market.
Before diving into the specifics, let’s outline how the consignment process works.
Sellers partner with a luxury consignment service to list their items for sale.
Most services will take care of authentication, sales transactions, and marketing.
The seller will receive funds directly from the sale minus any fees or commission taken by the consignment service.
While the process is pretty straightforward and simple, if you’re considering the consignment route, it is important to understand the advantages and disadvantages.
Luxury item consignment can be a win-win situation for buyers and consignment stores. Shoppers searching for preloved, high-quality designer pieces can rely on the local, reputable consignment service they have come to love and trust. But, sellers can also reap the benefits of the consignment model.
Benefits of Consignment
Established customer base: Consignment stores typically have a trusting, existing, and loyal customer base looking for high-end, preloved products. Consigning your luxury items with a reputable service will extend your reach allowing you to attract potential buyers you may not have access to through more conventional resale methods.
Access to expertise: Consignment shops that specialize in high-end goods often have extensive knowledge about luxury brands and partner with authentication services to boost their credibility. This expertise can also help ensure more strategic pricing and marketing. It’s like having a knowledgeable business partner working along with you to help boost sales and repeat customers.
Low upfront costs: Consigning luxury items and getting them seen by interested customers will typically cost you nothing upfront. Consignment services only charge a commission when the item sells. For consignment stores with an online presence, this also means photographs, descriptions, and disclaimers are a part of the service. This frees you up from the time consuming process of getting luxury items ready to sell online.
Quality assurance: Even with the growing popularity of the resale market, consumers are still leery when it comes to luxury items. Authenticity concerns present a big challenge for both buyers and sellers. Consumers demand reassurance they are purchasing genuine items. A trusted consignment store will typically have a rigorous authentication process in place. This trust then transfers to you as a seller benefitting both you and potential buyers.
An established customer base, expertise, upfront costs, and quality are all important considerations for the resale market. But, consigning your luxury items doesn’t come without its drawbacks.
While the process is pretty straightforward and simple, if you’re considering the consignment route, it is important to understand the advantages and disadvantages.
Disadvantages of Consignment
Time factor: One of the biggest disadvantages of the consignment model is that selling through consignment typically takes longer compared to listing items online or selling them directly. Because sellers are only paid when the item sells, you may end up waiting for a considerable amount of time to receive the funds from the sale. Most consignment centers also reserve the right to discount items when they have been a part of their collection for a long period of time further lessening your payout.
Commission fees: Even though there are no upfront costs, it is important to consider the percentage taken by the consignment along with any fees once your item sells. Seasonal demand fluctuations can also impact the resale value of your item meaning you may wait longer and get less if there’s low interest in an item.
Sales policies: Buyers looking to consignment stores for luxury items are usually aware of the strict no-return policies these services often maintain. Although it is likely shoppers have become accustomed to such policies, it is important that you are aware of how this might affect any commission or fees. For example, if a customer is allowed to return an item once purchased, does this item return to the sales floor, get donated to charity, or returned to its original owner? These are important questions to ask when determining if consignment is right for you.
Limited control: Once you’ve signed your item over to consignment, you give up control over pricing and marketing efforts. Consignors also have to rely solely on the store or platform’s marketing strategies. You’ll need to be comfortable moving forward without any insight into how your items are being presented or advertised and be willing to let go of your vision for potential sales.
Remember, with consignment, the vendor maintains ownership of your item until it is sold. This model minimizes the financial risk associated with maintaining inventory and investing in items that may be slow to sell or not sell at all.
Consigning luxury items may come with its share of disadvantages. But, it can be an attractive option for both sellers and buyers. Navigating any potential pitfalls requires careful consideration of all of the elements involved. You’ll want to make sure you are in the position to make an informed decision that aligns best with your goals and needs.
When weighing the pros and cons, there are a few important things to consider.
Tips for Successful Consigning
Identify which consignment stores or platforms specialize in your specific luxury item. For example, if you’re consigning high-end handbags you might want to avoid those who may focus on clothing or home goods.
If available, include original receipts or authenticity information with your items to help avoid any questions related to authenticity. This is especially high-priced items that are known to be frequently counterfeit.
Make sure your items, especially handbags, are clean and well-maintained. A well-kept, vintage item will be more attractive to consignment stores and potential buyers.
Set realistic expectations for how much you’ll earn after the sale by comparing the commission structure of various consignment services. It is also important to review contractual agreements carefully to ensure you have a thorough understanding of how the process works.
It is important to understand the full picture when it comes to making the decision to consign your luxury goods. Your decision to consign or sell luxury items directly requires thoughtful consideration of your personal circumstances. Ask yourself:
How much control do I want to have over the selling process?
What percentage of earnings am I willing to concede to a consignment service?
Does this particular service provide access to my ideal customer?
The role of consignment in promoting sustainable practices within the fashion industry should not be overlooked. As consumers become increasingly conscious of the environmental impact of fast fashion, they will continue to look for options in the resale market. Consigning luxury items offers yet another viable alternative.
Should you decide consigning is right for you, focusing on these considerations and practices can enhance your chances of a successful experience.