Jump to content

Consignment Issues


Recommended Posts

I have said that for me a mixed income stream is best as far as selling pottery. I sell my own at art shows for the lions share and have a mix of a few wholesale consignments.

That said many have mentioned that consignment has its pitfalls and you the artist can get hurt. Here are a few that I have had.

I have hade 4 consignment shops –one I had been in for 38 years (4 owners) until they closed down. I found out by accident 3 days before and I was not happy about how they did not tell any one. It was a gallery connected to a restaurant so they had lots of customers especially during the tourist season.

Their issue was signing a really bad 10-year lease but it turned out they also had poor people skills

They reopened after a one and half years and asked me back –I said no but will do wholesale with a limited forms deal-no more consignment-so far after a few years no issues but for me It will never be the same. I have been there 40 years now

Another other outlet is about a 25+ year run and now has a new younger owner and has been working well.

One other outlet has been about 14-16 years and has been trucking right along.

All these outlets above are all local and close enough for me to go to on a very regular basis and keep and eye on. This is a key point

The last is about 4 hours away each way. I have been in this tourist town in a gallery for about 30 years. Over that time I have been in three galleries but the 1st two are long gone. The most recent I have been in 16 years.

This outlet has been strong but peaked about 4 years ago and since then been struggling some. I take them a huge yearly shipment every spring (about 45 boxes of pots) and ship a few huge boxes later in year or drop another small shipment thru friend heading that way. They have a massive display of my work.

A few years ago they starting to slip behind on the monthly check. It was two months behind for 1 year they have been 3 months behind last year but it’s been very consistent the past year. During Christmas season I have so many pottery sales and demand going on I did not notice that slipped behind again until my late check came with a note in late January saying they have slipped 5 months back and they where trying to get back on their feet with payments.

I sent them a letter saying that 5 months was to long and that I knew winter was the slow season and that I have seen 5 months slip to longer and I was very concerned. As I have seen this long slow death of a business. I gave them a plan to get back to normal by mid summer with payments. They let it slip another month and I hit my red line. Now I’m speaking with them (3 partners) directly on the phone. Since I was their biggest seller I had some power to negotiate but in my heart I felt I could very easily loose these months.

I knew they where deciding whether to close or stay open. They admitted if I got my work they would close within a month. I got to the point that I just wanted my work back and that I was coming down to pick it all up. I mentioned that I would take them to small claims court to get my $6200.00 after I got my work.

This was a slam-dunk case in my favor but by no means I would ever get my money back. after winning that case.

I packed my truck with 25 empty boxes and my dolly and two paper rolls and my paper roller that late afternoon. I let them know I was coming down in AM. That night they called me and had borrowed some funds and decided to move forward and the check is in the mail.

Since that time we are back on track with a new contract that I wrote and in that contract I have to be paid every month by a certain date otherwise I’m picking up my work. I have limited my potential loss to 6 weeks tops. I also stipulated renegotiating the contract in early fall as I think they may not make it thru a winter and we need to decide about that at that time. I will only take a summer load down in a few months worth of pottery.

I have spent too much time on this mentally and part of me wishes I had got my work but I would be out $6200(the check was good). It's back to what it once was but I’ve got them on probation after shattering my trust, which is not a place that is good for me mentally.

My point here is keep it local and make sure you have your contract clean and keep the communication fresh

Link to post
Share on other sites

Ouch, sorry for your troubles. I too have had trouble with consignment. We have one shop who is always behind on the payments, and at the same time, continues demanding more and more stock. I will not give her any more stock until I have been paid for what she has already sold (and if she hasn't sold it then I know she is carrying plenty to keep her shelves full, it feels like she just wants overstock).

 

I may have to pop in there and do inventory for myself so I can do the proper math, and create a bill. She hasn't given me any kind of statement in months. The payment from the Christmas season came with out a statement so I couldn't even make sure the amount was correct; it was just a figure, no breakdown. Not cool!

 

I have been in another gallery/gift shop for about two years and they are awesome about giving me plenty of notice for re-order, sending me timely payments with accurate breakdown of figures, and have been generally a pleasure to work with. So not all consignment situations are full of grief!

 

It's definitely been a learning curve, the whole consignment thing. It does require due diligence because it's easy to let late payments and underpayments slide. As you illustrated, poor payment history can be a big red flag indicating a struggling or mismanaged business, and it feels like a balancing act [compassion vs business sense] deciding whether to stay in or pull out.

Link to post
Share on other sites

Roxy

My guy has always had very accurate records even though the payments went sideways-so if you do not have this I suggest leaving-its really in your best interest .

I demand good record keeping from any outlet.I give them good records on the front end and need them on the back end.

All this is up to me whether to do good business or move on-I have been in many a shop that closed up-the key is getting out before they go under and to keep it straight business wise.Its never personal

 

For example one of my outlets had the daughter send me my christmas payment which includes several months-she slopplly photocopied all the sales records which cut the month and totals off so it was worthless to read and mailed me that paperwork with a $5.000.00 check-I sent the whole deal back including the check and asked for better records that supported that check

 amount. I never again have had issues with this shop and paperwork. It not often someones send back a 5K check.Its not always about money with me its the whole deal and paperwork does matter.

My little story above is back on track and I just sent him a 75#s box of pottery and we have a new contract and it will not take much to have me pull the plug and he knows it-its in his best interest to keep me happy.

With consignment you need to limit your liability and timely payments and good paperwork are a must for this to work otherwise you can get hurt.

Link to post
Share on other sites

once again, Mark.....timely conversation.  Having a n issue here in my burg as well.  Because it is a small burg, the other vendors have started sharing some information as well.  The owners are extremely well intentioned, just struggling with "new business blues"   as are the vendors.  The biggest mistake we have made is no contract.  Therefore no expectations.  Yep.  Hate to even admit to that, but there you are.  Communication and a well thought out contract seem to be key.   What is the quote?  Good fences make good neighbors??  So do good contracts

 

Roberta

Link to post
Share on other sites

Anyone doing this type of sales should have a contract that spells out the details for them and the shop-its not hard or complicated-just jot down what you need and write it up and include the fine details as well as whats expected of you in terms of order and delivery times-also what are the payment times and details on splits.

should be about a page full at most .

Leave some room for the consignee and consignor to sight and date it

You could also set a date to do another one in the future so that reevaluation can happen

Link to post
Share on other sites

Anyone doing this type of sales should have a contract that spells out the details for them and the shop-its not hard or complicated-just jot down what you need and write it up and include the fine details as well as whats expected of you in terms of order and delivery times-also what are the payment times and details on splits.

should be about a page full at most .

Leave some room for the consignee and consignor to sight and date it

You could also set a date to do another one in the future so that reevaluation can happen

I did that with the wholesale account, but did NOT with the consignment.  :wacko:   What was I thinking?

 

r

Link to post
Share on other sites

Archived

This topic is now archived and is closed to further replies.

×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.