Consignment stores have grown in popularity in recent years, particularly among bargain hunters. In addition to offering great deals, such shops also buy clothing, giving shoppers a chance to make a little money when retiring previously used clothing or merchandise.
Although thrift stores and consignment shops seem similar, there are differences between their business models. Thrift stores accept donated merchandise and sell it as their own for profit. The person who has donated the merchandise receives no compensation, although he or she may be eligible for a tax deduction depending on the size of the donation.
Consignment stores act as third-party sellers, or consignees. The individual bringing in the merchandise -- the consignor -- is the rightful owner of any items at the consignment store until the point of sale. He or she negotiates a contract with the consignment store that indicates how profits of items sold will be split. The store will keep a percentage of the money, while the person whose items have been sold will get a share as well. Should the items not be sold within a certain period of time, they can be returned to the original owner.
Many consignment stores specialize in a particular type of merchandise. This enables them to keep a specific stock and carefully limit their inventories. Antiques are quite popular at consignment shops, as are household items and designer clothing. Some consignment shops specialize in baby items, as such items turn over quickly. Some car dealerships will sell vehicles on consignment as well.
Visiting a consignment store is not only cost-effective, but also an environmentally friendly way to shop for or dispose of items that still have utility. Many items at consignment stores are in excellent condition. For example, clothing on sale at such stores may only have been worn a few times.
Consignment stores present an excellent way to clear out unused items and make some money in the process. They also can be places shoppers turn to for discounts on items that have been gently used.