Consortium Agreement Template for United States

A Consignment Agreement lets one party (the consignor) place their goods with another party (the consignee) to sell on their behalf. The consignee displays and sells the items but doesn't own them - they just earn a commission on each sale while the consignor keeps legal ownership until items are sold.

These agreements spell out key details like commission rates, payment terms, and how to handle unsold merchandise. They're common in retail, especially for art galleries, antique shops, and fashion boutiques. Under U.S. commercial law, proper documentation helps protect both parties and clarifies their rights and responsibilities throughout the consignment process.

Use a Consignment Agreement when you want to sell items through someone else's store or platform without giving up ownership. This setup works perfectly for artists placing artwork in galleries, designers selling clothes through boutiques, or collectors offering valuable items through specialty shops. The agreement protects your ownership rights while letting someone else handle the sales process.

It's especially important to put a Consignment Agreement in place when dealing with high-value merchandise or when establishing ongoing sales relationships. The document helps prevent disputes about pricing, commission structures, and inventory handling - particularly if items get damaged or lost while in the consignee's possession.

• Clothing Consignment Contract: Specifically designed for fashion retailers and boutiques, with detailed terms about garment care, seasonal rotations, and pricing markdowns.
• Retail Consignment Contract: A broader agreement for general retail merchandise, focusing on store display requirements, inventory tracking, and flexible commission structures.
• Art Gallery Consignment: Specialized for artwork sales, including provisions for exhibition rights, artist credits, and insurance requirements.
• Online Marketplace Consignment: Adapted for e-commerce platforms, covering digital listing requirements, shipping procedures, and virtual inventory management.

• Consignors (Product Owners): Artists, clothing designers, antique collectors, or manufacturers who want to sell their items through a third party while maintaining ownership.
• Consignees (Sellers): Retail stores, art galleries, boutiques, or online marketplaces that display and sell items on behalf of consignors for a commission.
• Business Attorneys: Draft and review agreements to ensure legal compliance and protect both parties' interests.
• Store Managers: Handle day-to-day operations, including inventory tracking, sales reporting, and commission calculations.
• Insurance Providers: Cover consigned goods while in the consignee's possession, often required by the agreement terms.

• Basic Details: Gather full legal names, addresses, and contact information for both consignor and consignee.
• Inventory List: Create detailed descriptions of all items, including condition, value, and any unique identifiers.
• Commission Structure: Determine commission rates, payment schedules, and any minimum price requirements.
• Duration Terms: Decide on agreement length, renewal options, and notice periods for termination.
• Insurance Coverage: Confirm who provides insurance and what types of damage or loss are covered.
• Sales Process: Outline pricing authority, promotional rights, and handling of returns or exchanges.

• Party Identification: Full legal names and addresses of consignor and consignee, plus their roles and responsibilities.
• Property Description: Detailed inventory list with values, conditions, and unique identifiers of consigned items.
• Commission Terms: Clear breakdown of fees, payment schedules, and price-setting authority.
• Duration & Termination: Agreement length, renewal options, and conditions for ending the relationship.
• Risk & Insurance: Who bears liability for loss or damage, required insurance coverage.
• Sales Process: Rules for displaying, pricing, and selling items.
• Dispute Resolution: Governing law, venue for disputes, and mediation procedures.

A Consignment Agreement differs significantly from an Agency Agreement, though both involve one party acting on behalf of another. Here are the key distinctions:

• Ownership Structure: In consignment, the consignor maintains full ownership until items are sold. Agency agreements transfer no physical goods - the agent simply represents the principal's interests.
• Scope of Authority: Consignees can only sell specific items at agreed prices. Agents often have broader powers to negotiate deals and make decisions.
• Payment Model: Consignment deals use sales-based commission structures. Agency agreements might include fixed fees, retainers, or performance-based compensation.
• Risk Distribution: Consignees typically bear minimal financial risk beyond safeguarding items. Agents may face liability for their decisions and actions on behalf of principals.