| While many boutiques won't "do consignment" or even | | | | is a good inventory system in place. |
| try lesser known labels, some savvy business owners | | | | The vendor benefits from additional exposure in the |
| have been quietly cashing in on the opportunity. | | | | marketplace, the potential for added sales revenue, |
| Interestingly, advocates of the method agree it is a | | | | and valuable sell-through data. The vendor is essentially |
| good way to fill in stock and free up open-to-buy | | | | offering credit to the store owner; therefore, it is |
| dollars in a tough economy. | | | | important that the vendor evaluate potential |
| With consignment, the vendor and store share the load | | | | consignment relationships on a case-by-case basis. |
| of vendor financing while removing risk and debt from | | | | A popular alternative to consignment is a direct |
| the store owners' bottom line. This type of | | | | guarantee program, where the store is able to buy |
| vendor-merchant relationship is not the norm in the | | | | merchandise with the option to "swap out" or |
| Fashion Industry, where most goods are produced to | | | | exchange items that do not sell. This method ensures |
| order, several months in advance. But for smaller | | | | that the buyers' order will sell-through, or be replaced |
| companies with in-season stock, and well run boutiques | | | | with something else. The upside to this program is the |
| with good inventory systems, consignment can be an | | | | time saved in the area of accounting versus |
| appealing option. | | | | consignment, where each piece needs to be |
| Stores benefit from additional merchandise without | | | | accounted for and paid for shortly after a sale has |
| obligation to markdown or pay for items that don't sell. | | | | been made. |
| Consignment is also a way for buyers to add color, | | | | If managed properly, consignment and creative sell-in |
| test out a new style, designer line or price point without | | | | programs can be lucrative opportunities for both store |
| tying up open-to-buy dollars or credit. The downside is | | | | and vendor. |
| small: accounting can be time consuming unless there | | | | |