Consignment Agreement

A Consignment Agreement is a legally binding contract that sets the terms of sale, resale, transfer, or storage of a particular commodity.
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Frequently Asked Questions

In most cases, the Consignment Agreements refer to three types of commissions: ordinary, del-credere, and over-riding. Each type refers to a specific commission structure agreed upon by the consignor and consignee. Ordinary commissions are paid when the consignee makes a sale. A del-credere commission is an additional bonus the consignee can receive on top of sales for making credit sales. The over-riding commission can be earned if the consignee is allowed to sell at a higher retail price.

A consignment agreement can be one of two types: exclusive and non-exclusive. It’s up to the parties involved to decide how they want to draft the terms. Non-exclusive Consignment Agreements are still enforceable and may lead the consignor to make higher profits due to more consignees selling the same item.