Restaurant Equipment Consignment: How It Works
Consignment offers a middle path between selling equipment outright at a discount and holding onto it while it depreciates further. Understanding how it actually works helps you decide whether it’s the right way to move equipment you no longer need.
How Equipment Consignment Works
Under a consignment arrangement, a dealer lists and sells your equipment on your behalf, typically displaying or storing it at their facility, and pays you a portion of the sale price once it sells, keeping a commission for their part.
Consignment vs. Other Selling Options
Consignment isn’t the only way to move used equipment, and it isn’t always the best fit.
- Consignment often gets better prices than a quick private sale
- It takes longer than an outright sale to a liquidator
- You retain ownership (and risk) until the item actually sells
- Commission rates and terms vary significantly between dealers
When Consignment Makes Sense
Consignment tends to work best for equipment in good condition that isn’t urgently needed off your hands, since you’re trading a faster sale for potentially better returns. If you need cash quickly or want the equipment gone immediately, an outright sale is usually the better fit.
Consignment vs. Direct Sale
| Factor | Consignment | Direct Sale/Liquidation |
|---|---|---|
| Typical payout | Higher, minus commission | Lower, but immediate |
| Time to sale | Weeks to months | Often immediate |
| Who holds risk until sold | You (the consignor) | Buyer, once sale completes |
| Best for | Equipment in good condition, no urgency | Equipment needing to move quickly |