What is Consignment in Retail? Explained

A consignment is a business arrangement where a person or business, known as the consignor, entrusts goods to another party, known as the consignee, to sell those goods on their behalf. The consignor retains ownership of the items until they are sold. Once a sale occurs, the consignee typically receives a percentage of the sale price as a commission, and the remaining proceeds go to the consignor. This arrangement is common in retail, particularly for items like art, antiques, or clothing. Consignment can be a mutually beneficial arrangement, as it allows the consignor to reach a broader market and the consignee to earn a commission without purchasing the goods outright.