Like many other microscopically small, artist-run businesses, when I started Orange Twist in 2008, I began by consigning my work to retailers. Consignment is an agreement between a maker and a store which stipulates that the maker–the consignor– owns the items while the items are offered for sale in store of the consignee who usually pays the artist within 30 days of the end of the month in which the items are sold. Consignment is a great way for new makers to see what products sell, what doesn’t, and iron out all the supply chain and manufacturing kinks that inevitably arise. Consignment also works in the favor of the retailer as she does not have upfront product costs which helps her with her cash flow.
|I keep track of what I deliver and what’s been sold in this binder|
Fast forward to late 2010, I had built up a small wholesale business and was focusing on it rather than consignment because wholesale becomes more appealing as your business grows. Wholesaling is a great way for you to get your money up front or in whatever payment terms you stipulate. While consignment means keeping track of your inventory in each store, wholesale is a lot more cut and dry since once the retailer has your product, you no longer have to keep the pulse of what’s selling and what’s not in order to properly restock–that’s the buyer’s job.
In any case, in the fall of 2010 in the interest of expanding out of Seattle-proper, I reconnected with a woman who’d approached me about a consignment opportunity earlier in the year. As we exchanged emails and the contract, I started to feel she did not have the organizational skills required for running a consignment store which necessitates a strong inventory tracking system and monthly sales reports sent to artists who sell items. I explained my concerns to to Mr. Mate, but he advised me try it for a couple months since my cards aren’t big ticket items and the contract only stipulated that the items be consigned for 1 month. Despite my hesitation, I went ahead and signed the contract and sent the store a selection of cards. Over the course of six months I sent the shop nearly 200 cards worth almost 800 retail dollars.
I received a total of 6 checks over the course of the next year and when compared to my other consignment shops in (which I love, but really aren’t powerhouses in the sales department), this shop had 50% fewer sales. After 12 months I requested that my cards be returned due to disappointing sales but not surprisingly, received no response.
In January of this year I received an email from another consignor who had been trying to contact the store owner for months and who also hadn’t had any luck. As she was much more persistent in her inquiries, she ended up finding out that the owner had experienced health troubles and the space was being rented by another store. I will spare you my strong opinions on how this particular owner handled the situation and only say that communication is essential and honesty garners understanding, goodwill, and time.
Last week I was contacted by the new owner who kindly returned the 64 cards she was able to locate.
After going back through my records, I calculated that nearly a third of the cards are missing. They are either at the store yet to be discovered or were sold and I never received compensation.
As cliched as it sounds, you have to trust your instincts. I didn’t feel that the association with this particular store would be positive from the beginning and yet I entered into a contract. Before you enter into a consignment agreement, make sure your gut feels good about it, make sure you like all the terms of the agreement (if you don’t negotiate or bow out then and there), and make sure that the consignee is willing and reliable enough to give you a monthly accounting of what has sold and an inventory of your work. Do a little more homework by contacting artists who consign at that particular shop in order to gauge potential positives and negatives to working with the retailer in question.
Another layer of comfort can be added by being able to physically walk into the shop and take stock of what’s there and what’s not–if this means that you only consign with local shops, then make that your policy. Other times, if you want to consign with an out of the area shop, meeting the shopkeeper in person can allay concerns. Above all, keep your own records so you have an accurate idea of what has sold and what is still in the shop.
Out of the six shops with which I’ve consigned, I’ve only had one bad experience. Don’t let this story scare you away from consignment, but inspire you to trust your gut and do research before entering into any agreement.