What is a consignor agreement?
A consignor agreement is a contract between a consignment store and a consignor that spells out the terms of their relationship. It covers how items will be priced, how long they'll stay on the floor, what percentage of the sale goes to each party, and how and when the consignor gets paid.
If that sounds formal, the reality is simpler: a good consignor agreement fits on one sheet of paper and reads like a plain set of rules. Think of it less as a legal document and more as a handshake in writing — one that protects both parties and sets clear expectations from the start.
What to include in a consignor agreement
Not every store's agreement will look the same, but there are a handful of things that should be in virtually every one.
Consignor split
Spell out exactly what percentage of each sale goes to the consignor and what goes to the store. If your consignor split varies by category, item condition, or any other factor, list those variations clearly. Standard splits run from 50/50 to 60/40 (consignor/store), though this varies by store type and market.
Consignment period
Be clear about how long you'll hold items before returning them. Most stores run a consignment period of 30 to 90 days depending on store type and inventory volume. Once that window closes, specify:
How many additional days the consignor has to retrieve their items (a pickup window)
What happens to unclaimed items after the grace period ends — returned, donated, or transferred to store ownership
The simplest solution is often to donate unsold items to a local thrift store or nonprofit. But beware of false hope. It can be all too easy to hang onto old inventory once something is “yours.” The reality is that if something hasn’t sold in the first 60 days it’s unlikely to sell in the next 60. Not only will it continue to take up otherwise profitable space, but you run the risk of discouraging shoppers if they continually see the same thing on your shelf.
Pricing
Dictate who sets the price of items. Most consignors will assume this is the store (as will most stores), but it’s worth setting the expectation. Reassure consignors that you too want their goods to sell, that you keep a close eye on the market, and that you’re out to make a profit for both parties.
Discount schedule
If your store uses a discount schedule — marking items down after a certain number of days on the floor — include it here. Consignors should know when discounts kick in, how steep they are, and whether they have the option to retrieve items before a markdown is applied.
Payout terms
Explain how and when consignors will be paid. Cover:
Timing — are payouts issued on a regular schedule, or only on request?
Method — what's the default (check, cash, ACH, store credit), and what are the alternatives? If any method carries a payout fee, list it.
Minimums — is there a minimum account balance before a payout is issued?
Expiration — what happens to an unclaimed balance after a set period of time?
Many stores offer store credit as a payout option at a slightly higher rate to encourage consignors to reinvest in the store. If you do this, spell out the terms.
Liability and damage
Consider including a clause that limits your store's liability for items that are damaged or stolen while in your care. Accidents happen — a bumped rack, a spilled coffee. Being clear about your policy upfront is fairer to everyone than hashing it out after the fact.
Some stores go the other direction and commit to paying out the consignor's share on stolen items. It's a goodwill gesture, and for most stores it's a rare enough event that the cost is manageable. Either approach works — just make sure it's written down.
Marketing rights
Add a line reserving the right to photograph and use images of consigned items in your marketing and promotional materials. Most consignors won't blink at this, but it's worth having in writing.
Fees
If your store charges any fees, give them their own callout. Common ones include:
Buyer's fee — a fee applied before a split often as a way for the store to cover credit card processing.
Processing fee — taken from the consignor's portion when a card is used for payment
Cleaning fee — for stores that accept items requiring cleaning before display
Shipping fee — for items sold online, some stores share or pass on shipping costs
Payout fee — a small charge for ACH transfers
The goal isn't to nickel-and-dime consignors — it's to make sure fees are never a surprise.
Common consignor agreement mistakes
Not having one. Plenty of stores operate on a handshake and get away with it for years — until they don't. A single dispute over a missing item or an unexpected markdown can cost more in time, stress, consignor relationships, and bad Google reviews than it would have taken to write a one-page agreement.
Burying fees in the fine print. Fees are legitimate. Hiding them isn't. If you charge them, put them somewhere a consignor will actually see them — not in paragraph seven of a dense block of text.
Leaving out the discount schedule. Consignors who didn't know markdowns were coming will feel blindsided when they check their account and see a $40 item sold for $16. Put the schedule in the agreement and the problem goes away.
Being vague about what happens to unsold items. "We'll return them" is not a policy. When? What if the consignor doesn't pick them up? After how long do they become the store's property? Nail this down.
Never updating it. Your agreement should evolve as your store does. If you change your split, add a fee, or adjust your consignment period, update the agreement and have active consignors re-sign. An outdated agreement can cause more confusion than no agreement at all.
Consignor agreement template
Need a starting point? Download our free consignor agreement template to adapt for your store.