Evan Carmichael explains consignment as a way to gain distribution when you can't pre-sell. You get paid only when items sell, but you build awareness and relationships. He compares it to his YouTube model: provide content free, the platform sells ads, you get revenue and exposure.
Chapters
What do I think about consignment as a business model? I'm going to answer that question in today's episode of Lunch and Earn. So I recently got asked a question from one of my loyal YouTube viewers— love you guys— Pete, who wrote in asking about consignment and whether I thought it was a good model as an artist to have, have his work shown in stores but only on a consignment basis. And so in my view, once you have a quality product, the thing that you need to get is distribution, right? You need people out there buying it, you need the awareness the attention you need to get some dollars and some sales coming in. And the ideal way is, as an artist, is to have it pre-bought, right? I guess any entrepreneur, if you're selling a product, the ideal way, and living in a perfect world, it's pre-bought, right? Where before you go in and invest your time and energy to create something, you've already made orders from it. And that's using Kickstarter, and that's using your own hustle, and that's signing up potential partners or potential customers for you before you actually create anything. That's the ideal way because you have zero risk, right? You know you're gonna make some money off of it, and ideally then you could leverage merge that into other things, other prints, other products, and you're being paid upfront. That's the ideal way. But if you can't make that happen, then you have to look for alternative ways to get distribution for what you're creating. And consignment is one of those ways. And for those of you who don't know consignment, that's basically getting a store to take on your product but not guaranteeing anything, right? They're not guaranteeing a sale. If it sells, they get a commission. If it doesn't sell, then it just stays up there. And so the downside is you have products sitting on somebody's shelf and it's not getting You know, that's not a product that potentially could be sold somewhere else. And so I would do the consignment deal if I had no other options because it gives me some distribution. I'm sitting here outside the YouTube headquarters. I just came out of a meeting. You can see my badge. Evan Carmichael, YouTube. And YouTube and I have a kind of consignment relationship, right? I upload videos. That's my art. That's one of the things that I do, and I don't get paid by YouTube to do it. I put it up on their channel and They don't pay me directly, but they go out and they sell advertising, right? They sell sponsorships. And so I get paid some money from YouTube ads that then they're out selling for me, right? So we have a consignment relationship. And on top of that, I get awareness. I get distribution. So people hear about me, they learn about me, they ask me if I can do custom videos for them, they ask me if I can partner up with them on different projects. That's ideally what you want for your business. You know, if you're an artist or any entrepreneur, you want somebody who's gonna ideally promote you to help give you money, but promote you to spread your awareness, spread your message, and that could lead to other types of partnerships and deals. So if I was doing consignment, I would look for one, a store that I thought might have the access to my target audience. Who would be buying your art, and do they have that kind of clientele? And if they do, then you could anticipate potential sales, but also just people knowing about you, hearing about you, looking at your stuff. Attention is value, right? You can capitalize on attention. Somebody asked me, what is my business? How do I make money? Is I gather a ton of attention in the entrepreneurial space and then I capitalize on it. And so it's just kind of adjusting your philosophy where if you're out there creating awareness, people are knowing about you, that adds value that will come back to your business in ways that you can't even think about at the moment. The extra little gravy and maybe curveball that I would throw to you is I would then, whatever store I work with, try to make that store a success. Anything that I'm a part of, any, any business, any person I'm helping, I want that person to do well. If you are around me, I want you to do well. I want to be a part of your success. I don't want you to be mediocre. And so if I had my art, if that was what I was doing in a store, then I would work with that store to build their own awareness. I would try to have events at that store. I would follow that store on social media. I would promote them on social media. I would try to get close to their founder, whoever the manager is, and do things with them that would, that would help them. In a full circle way, it helps you, but it's just being a part of Helping people who are a part of your life and your business, I think is important. So yes, there's the data, the analytics, the will this company, this store help me sell more of my product, but then I take it to the next step and tap into their heart and have anybody who is associated with you in any way start to rise up, start to do better, start to have more results just by being around you. And when you create that aura, then you're going to start attracting the right people into your life, the right customers into your life, the right partners and media and investors and suppliers into your life. So go out and create that aura. I went on a little curveball there that I wasn't expecting, but that's how we roll. Got off a great meeting with YouTube and I was excited to make this video. So thank you guys so much for watching. I would love to know your thoughts on Consilient. Have you used it? Have you had success with it? Pros and cons from your own personal experience, or if you're thinking about it, let me know. Leave a comment below. Thank you guys so much for watching. Continue to believe, and I'll see you soon. My arm is getting tired from holding. Whew!
