Top 10 Drawbacks of Consignment
October 4, 2015 11:36 amIf you’ve made the decision to sell your RV, you most likely have a lot of questions. How much can I get for my RV? How should I sell it? Will there be a lot of hassle involved? Before getting into the nitty gritty of selling your RV, it’s important to determine how you want to sell your vehicle. There are a variety of ways to do this, including consigning the RV or selling it directly to an RV dealer. If you’re not familiar with consignment, there are a few things you should keep in mind. Rather than selling the RV outright, you are actually consigning the vehicle to a broker who will take care of the marketing and sales process for you. Sounds great, right? Not always. Keep reading to learn about the top 10 drawbacks of RV consignment and why selling your RV directly to an RV dealer may be the best option for you.
- No Money Up Front – One of the biggest disadvantages of consigning an RV is that you don’t receive any money up front. Any proceeds you may get from the sale of your vehicle depend completely on whether the consignment company is able to sell your RV. This means the company could have possession of your RV for weeks or months before you see a single dime. However, when you sell your RV outright, you are paid on the spot and can go home with the satisfaction and peace of mind of having cash in hand.
- Prepping Your Vehicle – When consigning your RV, it’s up to you to make sure the vehicle is in tip-top shape so that prospective buyers will be drawn to it. This can include anything from a thorough cleaning to repairs. Depending on the size and condition of your RV, both cleaning and repairs can be costly, time-consuming projects. If you’re ready to sell your RV, why put so much time and effort into fixing it up? When you sell your RV directly, you don’t need to worry about how it’s presented to buyers.
- Contractual Commitment – Most consignment companies require a contractual commitment that outlines the amount of time you will allow them to keep your RV as they attempt to sell it. What if you have a three-month contract with a company but an old friend suddenly offers you a great price for the RV? Unfortunately, you’re out of luck. The RV must stay at the consignment lot until it is sold or the contract has expired.
- Use of the RV – You will not be able to use the RV during the consignment contract, which means you still have the responsibility of ownership but without the convenience and benefits that come with being able to travel in your vehicle.
- Fees – Many RV consigners not only charge a flat or commission-based brokerage fee, but they may also charge extra fees for any cleaning or repairs that have to be made while the RV is on the consignment lot. These fees can drastically eat away at your profit once the RV is sold.
- Paperwork – Many RV consignment companies boast that they take care of all the paperwork for you. That’s not quite the case. In addition to the paperwork involved in the consignment contract, you may also need to provide other documents such as insurance papers, bank documentation, service records and accident reports.
- Insurance – Even though you can’t drive your RV while it is with the consignment company, you’re still responsible for paying the insurance on the vehicle until it is sold.
- Transportation – What if you live in Tampa and find a consignment company in Orlando that is offering to sell your vehicle at a good price? That’s great news. Until you realize you’ll have to spend time and fuel costs just to get the RV to the lot, which still isn’t a guarantee that they will find a buyer for your vehicle.
- Loss of Value – Just as a house may depreciate in value the longer it sits on the market without being sold, your RV may also lose value. While your vehicle may have been appraised at one price, it’s possible that the price will decrease over the course of weeks or months that it remains on the consignment market.
- Marketing – While consignment companies claim to take care of the costs and efforts associated with marketing your RV to potential buyers, how do you really know that they are doing all they can to sell your vehicle? Remember, in addition to your RV, they are likely trying to sell hundreds of others, which means yours may take a back seat to newer or more in-demand models that they have in their consignment inventory.