In "simple" terms, Consignments are generally something provided to the event with the intent being the item's ownership is retained by the Consignor until the item is sold.
If the consigned item is not "sold", it would normally be returned to the Consignor.
Essentially, the item will be auctioned and the Consignor will receive compensation for the item as agreed upon prior to the auction. The difference between the auction final winning bid and the compensation due the Consignor would go to the fundraiser.
Consignments are generally offered by a third-party and will have no "cost" for a non-profit to "reserve" the item for their auction; and, if the final bid is not high enough to cover the item "cost" and/or the Reserve Bid, the item is not "sold".
The Organization only incurs Expenses related to the Consignment item after it is sold.
# Consignment Item Ideas
Generally, Consignments may be seen when there is an inherent value placed on the item such as jewelry or artwork and where the owner (aka Consignor) is providing the item, for example, from a private collection or estate.
Items provided under Consignment may also be those where the Consignor has agreed to provide the item under the condition they will receive compensation as either a specific dollar amount and/or a percentage of the final winning bid. Although the item may not necessarily be "high" value, in most cases, the item will still have an inherent or intrinsic value associated with it.
Some Consignment auction items (with sample "rules") that might be considered:
- Jewelry (see Example Scenario Fixed Consignment Value Owed)
- Vacation packages (see Example Scenario Percentage Rules)
- Sporting event tickets (possibly provided by season ticket holders?)
- Autographed memorabilia (sports, music, celebrity, etc.)
# Consignments versus Donations
The main difference between Consignments and Donations is the donated item is "gifted" to the auction with no compensation being directly provided to the donor for their donation. All proceeds from the auction of the donated "item" would go to the fundraiser.
If you are not able to retain a donation, it might be well worthwhile to have a Consignment option to suggest to potential "donors" as well.
# Creating Consignment Items
There are a few steps to consider when Creating Consignment Items:
- Create an Expense Category, as needed, to make tracking the related expenses easier.
- Use the Add Edit Consignment Category function to assign the category for Consignments.
- Create A New Item (in some cases, you may be able to use an existing item).
- (recommended) Assign A Consignment Category To The Item.
- (optional) Set an appropriate Reserve Price for the item to meet any consignment obligations.
See Consignment Items for more information.