Selling Crafts on Consignment Without Losing Money

A gift shop owner loves your work and offers to stock it on consignment. No upfront cost, your pieces on a real shelf, and a cheque at the end of the month. Then three months later you collect half your stock back with a chipped corner and a sale total that barely covers the petrol.

Selling crafts on consignment can work, and for some makers it becomes a steady 20 to 30 percent of income. But the terms decide whether it pays, and most makers agree to them without reading closely. Here is what to check, what to price, and when to say no.

How selling crafts on consignment works

You hand over finished pieces. The shop displays them and sets them at your agreed retail price. When something sells, the shop keeps a commission and pays you the rest, usually monthly. Anything unsold stays your property and comes back to you at the end of the agreement.

The key difference from wholesale is who carries the risk. In wholesale, the shop buys your pieces outright at roughly half of retail. In consignment, the shop pays nothing until a sale happens. That is why consignment commissions are lower than wholesale margins, and why the shop has less reason to push your work.

Arrangement	Typical split to maker	Who carries unsold stock	When you get paid
Consignment	60 to 70 percent of retail	You	After each sale, usually monthly
Wholesale	About 50 percent of retail	The shop	On delivery or within 30 days
Your own stall or shop	100 percent, minus fees	You	At the sale

Pricing for consignment without undercutting yourself

The biggest mistake is pricing consignment pieces lower than your own shop. If a mug sells for $36 at your stall and the shop takes 35 percent, you receive $23.40. Some makers respond by dropping the shop price to $30 so it moves faster. Now your own customers see the same mug cheaper in town, and your stall sales suffer.

Keep one retail price everywhere. Then check that your share still covers your costs. Using the method in pricing handmade work so it actually pays, work out materials plus your hourly rate per piece. If 65 percent of retail does not cover that number with a little left over, the piece is not suitable for consignment at that shop. Send them something with better margins instead.

A quick worked example

Hand-bound notebook: materials $6, time 45 minutes at $20 an hour, so $15 labour. Cost to you: $21.
Retail price: $38.
Shop takes 35 percent: $13.30. You receive $24.70.
Margin over cost: $3.70 per notebook.

That is thin. The same shop selling your $14 greeting cards, which cost you $3.50 in total, returns $9.10 per card. Small, quick items often make better consignment stock than your showpieces.

The agreement terms that matter most

Always get it in writing, even with a friendly shop. One page is fine. It should cover:

Commission rate. 30 to 40 percent is common. Anything above 45 percent should come with real perks such as window display or featured posts.
Payment schedule. Monthly, with a written sales report showing item, date and price.
Agreement length. 60 to 90 days is a sensible first term. Long enough to judge sales, short enough to leave if it is not working.
Damage and theft. Who pays if a piece is broken in the shop or stolen? Many shops try to say nobody. Push for the shop covering it at your share of the retail price.
Discounts. The shop should not run sales on your work without your written okay. A "20 percent off everything" weekend comes out of your share too.
Collection. How many days you have to collect unsold pieces, and what happens if you do not.

Tax is worth a line too. The shop collects sales tax on the full retail price, but your income is only your share. Keep the monthly sales reports, because they are your record of what you actually earned.

Keep your own inventory sheet signed by both of you when you drop stock off. Photograph every piece on the shop counter. If anything goes missing, this is your only proof.

Why "just say yes to every shop" is bad advice

New makers are often told that any shop placement is good exposure. I disagree, and I have learned it the expensive way. Consignment ties up finished stock that could be selling at your next fair. If a shop holds $600 of your work for three months and sells $90 of it, you have effectively lent them $510 of inventory at no interest, and some of it will come back shop-worn.

Before agreeing, spend an hour in the shop on a Saturday. Count customers, see what they pick up, and check how other makers' work is displayed. If other consigned items are dusty, crammed on a back shelf or have faded tags, yours will be too. A busy shop with a clear display for local makers is worth a 40 percent commission. A quiet shop is not worth 25.

Fit matters too. Pieces that sell well at a craft fair because you are there to talk about them may sit untouched on a shelf, a point we cover in why craft fair tables sell differently than online shops. Pick items that explain themselves.

Making a consignment shelf pay over time

Visit every two to four weeks to restock, tidy your display and swap slow pieces.
Add a small card with your name, a line about how the piece is made and your shop handle. It does the talking you cannot.
Track sales per item type. After two months, drop whatever has not sold and send more of what has.
Ask the owner which questions customers ask. That feedback is worth almost as much as the sales.

If a shop asks you for custom pieces for its customers, treat those as commissions with a deposit, not consignment. The reasons are in why custom orders need a deposit.

Frequently asked questions

What is a fair consignment split for handmade items?

A 60/40 or 70/30 split in the maker's favour is standard for handmade goods. Splits of 50/50 are sometimes reasonable in high-traffic tourist shops that also cover damage and display your work prominently. Below 50 percent to the maker, wholesale usually becomes the better deal.

Is consignment or wholesale better for crafters?

Wholesale pays you upfront and moves the risk to the shop, but at a lower share of the retail price. Consignment pays more per sale but only when items actually sell. Consignment suits makers testing a new shop or product; wholesale suits steady sellers with proven demand.

How do I find shops that take handmade items on consignment?

Look at gift shops, galleries, cafes and visitor centres that already stock other local makers. Visit in person with three or four sample pieces, a price list and a short written agreement. Shops are far more likely to say yes when you have made it easy for them.