Advantages of Consignment
Consignment gives manufacturers or retailers more reach and improved market visibility for their products. Consignors place goods in consignment stores, who help them market their products at no additional cost.
Seasonal products have demand fluctuations since they are needed during certain periods of the year, so most sellers avoid selling such products. With consignment, retailers can stock up seasonal products and sell through this business model.
Selling with consignment doesn’t require any marketing plan. Retailers and manufacturers simply need to move their goods into consignment stores to sell for them.
Before consignment came along, manufacturers and retailers store their goods in warehouses, then they make deliveries to customers when orders are made. Now, they can take inventory off their chest by placing them in consignment stores.
Consignment helps wholesalers reduce their delivery costs. They do not need to worry about shipping costs. They only move goods to consignees who are marketing and selling.