How to Price Consignment Inventory Part 1: Identify if You're a Luxury, Mid-Range, or Thrift-Style Store

Pricing consignment inventory effectively isn’t one-size-fits-all. The first strategic step in developing your consignment pricing strategy is to identify what type of store you run – luxury, mid-range, or thrift-style. Your store type influences everything from how you intake items and authenticate goods to the pricing tactics you use and the markups or markdowns you apply. Smart pricing must balance fair market value, item condition, brand desirability, consignor expectations, and your profit margin. Overpricing can cause items to linger unsold (hurting your turnover), while underpricing leaves money on the table for both you and the consignor. In this guide, we’ll walk through how to price consignment inventory based on your store’s identity, with real examples and actionable tactics, so you can develop a winning consignment pricing strategy that fits your business.

Identify Your Consignment Store Type

Before setting price tags, clarify where your store fits on the consignment spectrum. Are you a high-end luxury boutique, a curated mid-range shop, or a bargain thrift-style store? Knowing this will guide your approach to how to price consignment items in your inventory.

Luxury Consignment Stores (High-End Pricing Strategy)

Characteristics: Luxury consignment stores specialize in designer and high-fashion items – think Chanel bags, Louis Vuitton wallets, Gucci shoes, fine jewelry, and other premium brands. If most of your inventory consists of high-end labels and one-of-a-kind pieces, and your average item price runs well above typical retail chains, you’re operating a luxury consignment store. Your clientele expects authenticity and excellent condition, and they’re willing to pay a premium for coveted labels (albeit still less than new retail).

Pricing Approach: Your pricing model will most likely be true consignment (commission split). Pricing luxury consignment inventory requires meticulous research and market awareness. Rather than a flat formula, you’ll most likely price based on current market value. High-end pieces often hold value (or even appreciate if especially rare), so the common “one-third of retail” rule falls short of being a thorough step. In practice, luxury shops look up comparable resale listings on platforms like Fashionphile, The RealReal, or eBay and then price slightly below those to stay competitive. For example, Sandra and Tomas Weddle of Couture Upscale Consign (a luxury boutique in Fort Lauderdale) research comparable listings for each designer handbag and aim to price their item a bit lower – if a Chanel bag is selling online for ~$1,400, they’ll tag it around $1,200–$1,300 to attract buyers. This market-aligned pricing ensures luxury shoppers feel they’re getting a deal while you still maximize the price for that item.

Intake & Authentication: A luxury consignment store must be extremely selective with intake. Every item should be authentic and in excellent condition. Operationally, this means investing time (and often money) in authentication. You might require proof of purchase or use experts to inspect stitching, materials, and serial numbers of luxury goods. While this adds to your workload, it justifies the higher prices – authenticity guarantees build trust and allow you to confidently price a $2,000 designer item knowing it’s the real deal. Many luxury consignment shops also maintain a selective list of consignors, working closely with sellers of high-end pieces. It’s common to offer higher payout percentages to entice owners of Chanel and Hermès to consign with you. For example, rather than a flat 50/50 split, a luxury shop might use a tiered commission split that gives the consignor 60-70% on high-ticket items. This rewards consignors for bringing in expensive inventory and keeps them happy without haggling. As ConsignCloud notes, such tiered split pricing improves consignor relationships and keeps luxury item supply flowing.

Check out ConsignCloud's split tier feature—it automates the process to reduce error and speed up intake

Pricing Tactics: Luxury stores often forego blanket markdown schedules in favor of case-by-case markdowns or longer consignment periods. Because each item is unique and valuable, you might allow 90+ days before major discounts, especially if the item’s desirability is strong. Still, keeping an eye on market trends is crucial – if designer trends shift or a model is saturated online, be ready to adjust the price. Data-driven pricing is your friend: Alexandria Hammond, owner of My Girlfriend’s Wardrobe, shifted into carrying more luxury items and found that deeper research and accuracy were needed. “With Louis Vuitton, Chanel, Gucci – those pieces require a lot of research and time,” she says, explaining that she prices those based on online sold prices and market demand, not just a percentage of original retail. The payoff for such diligence is huge: her store sold 30 Louis Vuitton pieces in 25 days (about $14–15k in sales), with an average shelf time of just 16 days– a testament to how spot-on pricing for luxury can lead to fast turnover even at high price points.

Mid-Range Consignment Stores (Consistent Pricing Strategy)

Characteristics: Mid-range consignment stores form the bread and butter of the resale world. If your shop carries popular mall brands or contemporary labels (examples: J.Crew, Ann Taylor, Free People, Athleta, Michael Kors) and items generally sell in the tens of dollars (rather than hundreds), you’re a mid-range consignment store. These shops offer quality goods at a fraction of retail – appealing to shoppers who want brands and style on a budget. Inventory is often a mix of current fashion and classic pieces, typically in gently used condition and not more than a few years old.

Pricing Approach: Your pricing model will probably be a hybrid of consignment and buy outright. Consistency and fairness are key for mid-range pricing. Most stores in this category use a version of the “one-third rule” (set the base price around one-third of the item’s original retail price, then adjust up or down based on item-specific factors). For instance, if a Banana Republic dress originally sold for $90, you’d start around $30. Then consider condition, demand, and uniqueness – maybe add 10% if it’s a brand-new piece or a hot style, or subtract 10% if it’s a common basic or shows slight wear. This systematic pricing ensures you’re competitive but not giving merchandise away. As an example, ConsignCloud’s pricing guide suggests starting at ~33% of retail and ±10–20% for condition and popularity. In practice, you might tell a consignor: “This J.Crew sweater was $100 new, so we’ll price it about $33. It’s a popular style in excellent shape, so we’ll actually list at $36.” By using such a formula, mid-range stores maintain consignment pricing consistency and avoid emotional or arbitrary pricing.

Tiered Brand Lists & Matrices: Mid-range stores handle a wide range of brands and categories, so creating a tiered brand list or pricing matrix (sometimes called a price book) can be extremely helpful. Many successful shops literally codify their pricing strategy in a spreadsheet or guide. For example, My Girlfriend’s Wardrobe’s owner built a comprehensive pricing guide with defined levels for brand tiers, garment categories, and condition grades. In her system, a “Level 3” brand short-sleeve top has low/medium/high pricing bands depending on style details (basic tee vs. graphic vs. embellished). This kind of matrix means anyone on the team can price items within a predictable range. You might classify brands into Tier 1 (premium contemporary brands), Tier 2 (mall brands with good resale value), Tier 3 (lower-end or overstock-prone brands), and assign default pricing ranges for each when in good condition. For example: Tier 1 women’s jeans might be $40–$50, Tier 2 jeans $20–$30, Tier 3 jeans $10–$15. If a brand is flooding your racks or underperforming, your guide should reflect that with lower pricing or even a decision to stop accepting it. Alexandria from My Girlfriend’s Wardrobe takes this further by conducting twice-yearly brand audits, cutting hundreds of underperforming brands from her acceptance list to improve sales velocity. “If [a brand] doesn’t clear a certain sales threshold, it’s gone,” she says – preferring one Louis Vuitton bag over 20 Loft tops at $16.99 each. The lesson: curating brands and adjusting pricing levels accordingly can boost your margins and turnover. In fact, after she purged 300+ low sellers, her store’s sell-through rate jumped by 20%.

See how My Girlfriend's Wardrobe used a brand hierarchy to clean up and optimize inventory intake

Markdown Schedules: Unlike luxury shops, mid-range consignment stores typically enforce a standard markdown schedule to keep inventory moving. Common practice is a 60- or 90-day consignment period divided into stages. For example, you might keep items at full price for the first 30 days, then automatically mark down by 20–25% after 30 days, and 50% off by 60 days. By day 90, any remaining stock could be heavily discounted or returned to the consignor. This encourages shoppers to buy before the item is gone or gets snapped up at a lower price, and it prevents your racks from stagnating with old merchandise. ConsignCloud can automate these discounts so stores can stay focused on their goals. Turnover is crucial – one consignment software guide suggests aiming to sell items within 60 days for most categories. If you notice certain items routinely hit the final markdown, that’s a sign to adjust initial pricing or reconsider accepting similar pieces.

Checkout ConsignCloud's automated discount features—push bigs sales and clean out old inventory with ease

Consignor Relations: Mid-range stores often juggle hundreds of consignors, from one-time closet cleaners to regulars who supply inventory. Building trust through transparent pricing policies is vital. Many successful shops publish their general pricing approach (e.g. listing examples of what common brands fetch) or will explain to consignors how they arrive at a price – this manages expectations. Such transparency reassures consignors that you won’t undervalue their items. It’s also wise to have a fair split – usually 50/50 or 40/60 (store/consignor) for mid-range merchandise. Some stores use split tiers as well, giving, say, 50/50 on items under $100 but 40/60 (store/consignor) on pricier items as an incentive for better goods. And remember, you can negotiate on exceptional pieces or high-volume consignors. If a consignor brings you loads of in-demand inventory, reward their loyalty – perhaps a bump in their split or store credit bonus. This can cost a little margin short-term, but it keeps quality inventory flowing and those consignors happy to work with you.

Example Store, Mid-Range Shop: My Girlfriend’s Wardrobe in York, PA (featured on ConsignCloud) exemplifies a data-driven mid-range consignment store that grew into carrying some luxury items (though her store seems to be luxury-focused in recent months). Early on, Alexandria (the owner) priced by gut feeling, but she later implemented a structured system with brand/category tiers and leveraged sales data to refine pricing. If Gap dresses were selling quickly, she’d source more and maybe price them a tad higher; if a brand wasn’t moving, it got pruned or discounted. By tracking sell-through rates and focusing on what customers want, she eliminated over 300 underperforming brands and saw a 20% increase in overall sell-through. The store also uses a markdown schedule and a clear consignor agreement (60/40 split, 90-day term, standard markdowns). This consistent yet flexible pricing strategy helped turn her once “vibes-based” pricing into a reliable engine for growth, more than doubling monthly sales. The takeaway: mid-range stores thrive on a balance of formula (one-third rule + adjustments) and agility (tweaking prices or acceptance based on data).

Thrift-Style Consignment Stores (Fast-Turnover Pricing Strategy)

Characteristics: Thrift-style consignment stores blur the line between a traditional thrift shop and a consignment boutique. These stores emphasize low prices and quick sales. You might be a thrift-style consignment store if you accept a broad array of lower-priced brands (including fast fashion or older items) and cater to bargain hunters. The shopping experience may feel like a treasure hunt, and customers expect deals comparable to thrift stores or yard sales – often paying just a few dollars for items. Some nonprofit-run consignment shops also fit this category, where unsold items are donated rather than returned, to keep inventory fresh.

Pricing Approach: Your pricing model will probably by a hybrid of consignment, buy-outright, and donations. For thrift-oriented consignment, volume and turnover trump maximizing each item’s price. Pricing is typically straightforward and aggressively low to encourage rapid sales. Many thrift-style consignment shops use simplified pricing rules: for example, flat pricing by category. You might price all standard T-shirts at $5, all jeans at $10, all jackets at $15 unless they are exceptional brands. There’s still judgment involved – a high-end piece that sneaks in might be priced higher – but generally these stores aim to move merchandise fast. One children’s consignment sale suggests pricing items at 25%–50% of retail, with a minimum of $3, which reflects the lower end of resale value appropriate for thrift-level goods. Automation and speed are important: intake teams might not lookup every item’s original price (especially if dealing with generic brands or older items). Instead, they rely on experience and quick visual appraisals. The one-third rule can be a guidepost here too, but since many thrift-store items are inexpensive retail to begin with (e.g. a $20 shirt might be tagged $4–$6), the exact math often gives way to rounded, low price points that shoppers find irresistible (using odd pricing like $4.99 to appeal to psychology).

Markdowns and Turnover: Thrift-style consignment shops tend to have the fastest markdown cycle – or even skip formal markdowns by initially pricing things so low they don’t need reduction. If items don’t sell quickly, these stores will mark them down steeply or clear them out via clearance events. For example, some stores have a 60-day clothing consignment period: after 30 days, items drop 25% in price; after 45 days, 50% off; and by 60 days, anything unsold is donated. This means no item hangs around more than two months. The result is a constantly refreshed inventory, which regular thrifters love – there’s always something new on the racks. Your goal in a thrift-style shop is to keep “Time to Sale” very low, ideally under 60 days on average. Practically, that could involve weekly color-tag sales (e.g. each week, tags of a certain color are 50% off) or monthly clearance racks where older consigned items are liquidated. While the margins per item are thin, the high turnover generates revenue and keeps consignors bringing items in (since they see quick sales).

Jacque Holder uses quarterly sales (dropping some inventory to 80% off) to achieve some of her highest profits in a day

Intake and Operations: In a thrift-style environment, you might accept a larger volume of items per consignor and be a bit less stringent on brand and season, but you’ll still enforce quality standards (no one wants torn or stained items even at $2). The intake process should be efficient – possibly using batch intake features in software or pre-set price templates. Because of the lower payouts, managing consignor expectations is crucial: make it clear that you price low to sell high volumes. Interestingly, some thrift-style consignment shops succeed by blending consignments with donations. Even if you’re not a charity store, you can adopt a similar rapid-cycle mindset: any item that lingers beyond your short consignment period could be returned or donated, freeing up space for new inventory.

Example Store, Thrift-Style Shop: Blue Bird Circle Shop in Houston, TX operates as a charity-driven consignment store that feels like a thrift. They accept clothing, home goods, and more, pricing them to sell quickly and benefit their cause. Consignors get 60% of the sale price, and the store (charity) keeps 40%. But the key is their markdown policy: by 30 days, unsold items drop 25% in price; at 45 days, 50% off; and at 60 days, any remaining clothing becomes a donation to the shop. These stores thrive by attracting budget-conscious customers, turning inventory quickly, and often rotating stock in and out so fast that each visit is a new adventure. The strategy works because lower-priced inventory often requires more effort to sell (you need high foot traffic to move lots of $5–$10 items), so the business model focuses on volume: the more you sell, the more you earn. Keeping margins slightly higher on very low-ticket items (e.g. a 60/40 split favoring the store on a $10 item) is common to cover the handling effort. In the end, thrift-style consignment is all about fast, efficient turnover—price it low, sell it quick, repeat.

Ready to Elevate Your Consignment Pricing?

Identifying whether your store is luxury, mid-range, or thrift-style is truly the first step in mastering how to price consignment inventory effectively. With that foundation, you can apply the appropriate strategies to price items fairly, attract customers, and keep consignors happy. The result is a healthier business: better inventory turnover, optimized profits, and a reputation for savvy pricing.

If you’re ready to take your consignment store’s pricing (and operations) to the next level, consider investing in tools and technology that support these best practices. ConsignCloud, for example, can help you automate markdown schedules, manage tiered pricing structures, and gain insights from your sales data to continually refine your approach. The right software acts like a smart assistant, ensuring your pricing rules are applied consistently and freeing up your time to focus on sourcing great inventory and serving customers. Try ConsignCloud for free and see how it can streamline your pricing process while improving your store’s profitability and growth.