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What is Consignment Agreement?

Consignment Agreement Defines terms for consigning goods for sale, specifying ownership, pricing, and sales commissions.



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Consignment Agreement


This Consignment Agreement (the "Agreement") is made and entered into as of [Insert Date], by and between Fashion Haven Boutique, a [State] corporation ("Consignor") and Style Trends Emporium, a [State] corporation ("Consignee"). Both Consignor and Consignee may be referred to individually as a "Party" and collectively, the "Parties".

1. Products

1.1. Description of Goods


The Products under this Agreement consist of Designer Clothing and Accessories for the Fall/Winter 2023 Collection, as provided by the Consignor and further described in Exhibit A, attached hereto and incorporated herein by reference ("Products").



2. Ownership

2.1. Consignor's Ownership


The Consignor shall retain full ownership and title of the Products until sold by Consignee. The Products shall remain the property of the Consignor and shall be held by the Consignee in trust and on a consignment basis solely for the purpose of sale in accordance with this Agreement.



3. Pricing

3.1. Retail Price


The Consignor shall determine the retail price for each Product listed in Exhibit A, which may include any applicable sales taxes. The Consignor reserves the right to change the retail price upon written notice to the Consignee.



4. Consignment Fees

4.1. Consignment Percentage


The Consignee shall be entitled to a consignment fee equal to [Percentage] % of the retail price (excluding applicable sales taxes) of each Product sold ("Consignment Fee"). This fee shall be deducted from the amount payable to the Consignor, as described in Section 5 of this Agreement.



5. Payment and Reporting

5.1. Monthly Payments and Statements


The Consignee shall remit payment to the Consignor for the Products sold, less the Consignment Fee, on a monthly basis. Payments shall be accompanied by a statement detailing the sales of Products, the Consignment Fees deducted, and the net amount payable to the Consignor. Payments and statements shall be delivered to the Consignor on or before the [Day] day of each calendar month for Products sold during the preceding calendar month.



6. Consignee Responsibilities

6.1. Sales and Promotion


The Consignee shall be responsible for displaying and selling the Products in a commercially reasonable manner, consistent with the Consignee's regular practices for similar items. The Consignee shall be responsible for providing appropriate promotional materials and efforts to support the sale of the Products.


6.2. Storage and Insurance


The Consignee shall be responsible for storing the Products in a secure, climate-controlled environment and maintaining appropriate insurance coverage for the Products while in Consignee's possession.



7. Consignor's Responsibilities

7.1. Shipment and Delivery


Consignor shall be responsible for delivering the Products to Consignee's designated location. Title and risk of loss for the Products shall remain with Consignor until Consignee accepts delivery. Consignor shall retain ownership of Products while in transit.


7.2. Product Quality and Standards


Consignor warrants and represents that the Products shall be new, authentic, and free from defects, and shall conform to the descriptions provided in Exhibit A. Consignor shall be responsible for replacing any defective or damaged Products at no cost to Consignee.



8. Term and Termination

8.1. Term


This Agreement shall commence on the effective date and shall continue for a period of one (1) year, unless earlier terminated by either Party in accordance with Section 8.2 below.


8.2. Termination


Either Party may terminate this Agreement for any reason upon thirty (30) days written notice to the other Party. In the event of termination, the Consignee shall return any unsold Products to the Consignor at the Consignor's expense, and Consignor shall pay to Consignee any unpaid Consignment Fees for Products sold prior to the termination date.



9. Governing Law and Dispute Resolution

9.1. Governing Law


This Agreement shall be governed by and construed in accordance with the laws of the United States and the State of [State], without giving effect to its conflict of law principles.


9.2. Dispute Resolution


Any dispute arising out of or in connection with this Agreement shall be settled by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA") in force at the time of the dispute. The arbitration shall be held in [City], [State], and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.



10. Miscellaneous

10.1. Notices


Any notices, requests, or other communications required or permitted to be given under this Agreement must be in writing, and shall be deemed duly given when personally delivered or sent by certified mail, return receipt requested, overnight courier, or email, addressed to the Parties at their respective addresses as set forth below or to such other address as a Party may designate by written notice:


Consignor:
[Fashion Haven Boutique]
[Consignor's address]
[Phone number]
[Email]


Consignee:
[Style Trends Emporium]
[Consignee's address]
[Phone number]
[Email]


10.2. Entire Agreement


This Agreement, including Exhibit A and any amendments thereto, constitutes the entire understanding of the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous written or oral agreements, representations, warranties, and understandings between the Parties.


10.3. Amendment


This Agreement may be amended or modified only by a written instrument executed by both Parties.


10.4. Waiver


No waiver by either Party of any breach or default under this Agreement shall be deemed to be a waiver of any preceding or subsequent breach or default.


10.5. Counterparts


This Agreement may be executed in any number of counterparts and each such counterpart shall be deemed to be an original instrument, but all such counterparts together shall constitute but one Agreement.



IN WITNESS WHEREOF, each Party hereto has executed this Agreement as of the date first above written.

____________________________ _____________________________
[Fashion Haven Boutique] [Style Trends Emporium]
[Authorized Signatory] [Authorized Signatory]
[Title] [Title]

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Common Sections of a Consignment Agreement


In this Consignment Agreement, you will see the following sections:

  1. Products
  2. Ownership
  3. Pricing
  4. Consignment Fees
  5. Payment and Reporting
  6. Consignee Responsibilities
  7. Consignor's Responsibilities
  8. Term and Termination
  9. Governing Law and Dispute Resolution
  10. Miscellaneous


Analysis/Summary of each section

  1. Products : This section describes the specific items being consigned, in this case, Designer Clothing and Accessories for the Fall/Winter 2023 Collection. Exhibit A provides further details about the products.

  2. Ownership : The Consignor retains ownership of the products until they are sold by the Consignee. The products are held by the Consignee in trust and on a consignment basis for the purpose of sale.

  3. Pricing : The Consignor determines the retail price for each product, which may include sales taxes. The Consignor can change the retail price by providing written notice to the Consignee.

  4. Consignment Fees : The Consignee receives a consignment fee equal to a specified percentage of the retail price (excluding sales taxes) of each product sold. This fee is deducted from the amount payable to the Consignor.

  5. Payment and Reporting : The Consignee pays the Consignor for products sold, minus the consignment fee, on a monthly basis. Payments are accompanied by a statement detailing sales, consignment fees, and the net amount payable to the Consignor.

  6. Consignee Responsibilities : The Consignee is responsible for displaying and selling the products in a commercially reasonable manner, providing promotional materials and efforts, storing the products securely, and maintaining insurance coverage for the products while in their possession.

  7. Consignor's Responsibilities : The Consignor is responsible for delivering the products to the Consignee's designated location, ensuring product quality and standards, and replacing any defective or damaged products at no cost to the Consignee.

  8. Term and Termination : The agreement lasts for one year, unless terminated earlier by either party with 30 days written notice. Upon termination, unsold products are returned to the Consignor, and any unpaid consignment fees for sold products are paid to the Consignee.

  9. Governing Law and Dispute Resolution : The agreement is governed by the laws of a specified state, and any disputes are settled through arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association (AAA).

  10. Miscellaneous : This section covers various topics, including how notices should be delivered, the entire agreement clause, amendment procedures, waiver provisions, and the ability to execute the agreement in counterparts.

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