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Permalink Reply by Bridget Early November 27, 2013 at 4:21am

Just re-reading this thread.  Lots of good advice here. I have been asked to put my hats in a boutique by Dec. 7, and need to make sure I have my ducks in a row.  I'll be honest consignment makes me nervous, but it may also  be an opportunity to get my product seen. Has anyone ever been charged a monthly fee to place your items in a boutique?  If so what is fair?  This boutique is asking for 30% plus tax and cc charge.  Monthly fee is waived for December, but will begin in January.  Has anyone ever made "sample" hats and then just taken orders based on the samples offered?

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Permalink Reply by Elsie Collins November 27, 2013 at 2:47pm

I've never heard of being charged a monthly fee!  Consignment is a voluntary business agreement between two people, and I would strongly recommend that if you decide to do it, that you draw up a written contract of terms with the owner.  Without that document, she can say a hat was shoplifted, and poof!! You're out a hat. Consignment's  standard fee is 1/3 to the shop owner of the selling price.  If tax is applicable in your state, that is the shop owners responsibility to collect, and remit it to the town tax assessors' office with her monthly sales returns. If she needs to add the credit card percentage that she is charged on a sale, again, that is not your responsibility.  She is making 30% of your selling price for no investment, save for the few square inches the hat takes up. If they sell well, and quickly, she should have no qualm about the space. I have owned a brick and mortar shop and have done consignment, so this has been my experience. Above all, get it all in writing, and an inventory list of what you will display, and have her/him sign it, and update it frequently as hats sell, or get replaced!! Find out what their policy is if a hat goes missing or damaged.  You need to decide what you're willing to risk. If the shop owner will not put it in writing, forget her and walk away.

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Permalink Reply by 1fi9iq6yxs6ig November 27, 2013 at 3:12pm

I'm agreeing with Elsie.  Never heard of a monthly fee.  I have mine in a local boutique and they take 30%.  I agree that you need a contract/agreement with them and an inventory list - that both parties have a copy of and that is regularly updated.  My arrangement is only for blocks of 3 months at a time.  I find that my hats won't stand the treatment of being in a shop any longer than that.

If the shop takes bespoke orders, I give them 30% too.

Make sure you are pricing properly - most important if you have to add an extra 30% +monthly fee into the cost.  Seriously, it won't be worth your while if you're not making a profit on every sale.   Think about things like repairs, replacement stock, delivery to the shop. 

Consignment is great for the shop owner, as you have all the investment.  If your hats are selling well, you have a good argument to sell direct to the shop rather than have on consignment.  

I've made sample hats, but I use them to talk to clients - they stay in my possession.

Hope this helps Bridgit :)

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Permalink Reply by Bridget Early November 28, 2013 at 4:07am

Thanks, Elsie and Greer!  A contract and inventory list goes without saying.  I e-mailed the individual back and told her that I would need to address these and other concerns such as damage etc.  Having a background in retail and running my own tailor shop there are a number of issues that I immediately thought of.  Your points and suggestions are all spot on.  I do plan to add 30%-40% to my prices, which I keep pretty low, to cover the cost of overhead and damages.  I had planned to include in my contract that the shop owners will be responsible for the cost of any damaged and stolen hats.  (I was in charge of shrinkage, when I worked retail).

I haven't heard back, so either they haven't had time to consider my points, don't want to be held to a contract, or haven't thought about some of my concerns prior to my e-mail.  They are just opening, and I get the impression they are a little disorganized and/or inexperienced, so I will need to weigh all of that to make a decision. I feel that they should have set a flat percentage that would have included both tax and cc charges, but the idea of taking a percentage and charging a monthly fee sounds a little odd.  They are just opening, so I am thinking that they want the fee to insure they have enough income to keep the doors open until they are making money.

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Permalink Reply by Shelbee Wise October 21, 2014 at 4:31am

Kathleen,

A bit late to this discussion but I wondered if you have found an online store to feature your hats?

I used to own a consignment shop in Philadelphia (eventually closing it down due to a rent increase that was a bit unattainable) but recently have been building an online presence for free on notemote. It takes a bit of patience but is definitely worth looking into...especially if you like to write about your designs and post pics.

Best of Luck

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