Last Updated on October 12, 2021 by Jessica
If you’re like me, then you may own an RV and have been on the road for a while but haven’t ever heard RV consignment. You may ask, “How does RV consignment work?”
It isn’t that complicated, though. RV consignment is pretty much the same thing as car or clothing consignment. You hire a third party to look after your RV for you and sell it. Consignment takes most of the headache out of advertising and marketing your RV.
Sound simple and straightforward, right? While the process isn’t an overly complicated one, there are several things that you should be aware of before deciding to consign your RV. Some pros and cons accompany the consignment process, and we’re going to take a deep dive into them.
If you have any questions about RV consignment, then you’ve come to the right place. If you recently consigned your RV and want to know if you did the right thing, then you’ve also come to the right place. Just because you consigned once doesn’t mean that you’ll want to next time. Without further ado, let’s get to it!
- 1 What is the Cost of RV Consignment?
- 2 What Makes for a Good RV Consignment Dealer?
- 3 Consignment Selling vs Private Sale of an RV
- 4 Pros and Cons of RV Consignment
- 5 Pros
- 6 Cons of RV Consignment
- 7 How Does the Sale Process Work?
- 8 Final Thoughts
What is the Cost of RV Consignment?
If you’re trying to sell your RV, it’s either because you want to upgrade to something else, you need cash quick, or you don’t use your RV enough to justify keeping it around. No matter the reason, you’ll want to get the most money possible for your troubles.
A Percentage Goes to Consignment Fees
Most RV consignors won’t charge you money upfront to store and advertise your RV, but they will take a percentage of the profits and charge consignment fees. Typically, whoever consigns and sells your RV will take anywhere between 10 and 15% of the selling price, depending on a few factors.
Consignment contracts usually work one of two ways:
- You will pay the consignor a flat percentage of the sale price no matter what it is.
- You and the dealer will agree on a target price, and the seller will take anything over the selling price as a commission but will not accept any other percentage.
Example time! Let’s say you decide to sell your RV for $50,000, and it ends up selling for $60,000. In the scenario where the dealer gets 10% of the profit, the RV consignment cost would be $6,000. In scenario number 2, where they only take the gains over the selling price, RV consignment costs will be a whopping $10,000. Either way, you end up with at least $50,000, but it could’ve been more in scenario number 2.
To keep this from happening, you must know your RV’s market value so that a dealer can’t undersell you on it. In situations like scenario number 2, a wise RV dealer will always try to under-list your RV so that they walk away with more money. Be on the lookout for dealers like this.
RV Consignment Insurance May Be Needed
Another thing to be aware of when consigning your RV is that most dealers will require you to have some form of RV consignment insurance. This type of insurance works similar to regular RV insurance and protects against any damage that would occur due to something at the consignment lot.
Check with your current insurance companies and see if they offer consignment insurance or if your current plan is satisfactory. It would save you some headache and paperwork if that were the case.
How to Determine the Fair Market Value of Your RV
Determining the fair market value of your RV is essential information to be gained to keep from getting ripped off. If you try to charge too much for your RV, you’ll likely never sell it or have to come down from the asking price. Charging too little will get your RV sold, but you’ll lose out on the profit margin. If you opt to sell through a consignor, you also want to know the fair market value to ensure that they don’t undersell the RV, as discussed in scenario two above.
The best way to determine your RV’s fair market value is to go directly to the manufacturer and get the information from them. Based on the age and condition of your specific model, they will be able to tell you what the current value of your unit is.
The second way to determine your RVs value is to visit a website like rvselect.com and input your RVs information. Once you do this, the website will give you a good idea of your asking price. Going through your RV manufacturer is a safer bet at determining your RV value, but it might be easier to go through a website. RV factories are busy, have strange hours, and can sometimes be challenging to get ahold of.
What Makes for a Good RV Consignment Dealer?
There are several ways to distinguish between good RV consignment dealers and bad ones. Some of these signs are objective, while others depend on what you’re looking for. Things like turnover rate, security, and good reviews are things that everyone wants, while contract length, extra bells and whistles, and fee terms may vary from person to person.
- They boast a high turnover rate.
The faster your RV sells, the better. You don’t want to be storing it somewhere that it will be sitting for months on end.
- Do they charge a percentage or a flat rate for their fee?
The contract terms are primarily up to what you prefer personally. Some may like the sales percentage method, while others prefer the over-selling price commission.
- What is the length of the consignment contract?
The longer the contract, the better when it comes to consignment. Renewing contracts can be a hassle and could mean rewriting terms and conditions.
- What extra services do they offer?
Some RV consignors offer free tune-ups and cleanings on your RV. While this isn’t a mandatory thing to look for, it’s an excellent commodity.
- Look for hidden fees and cancelation fees.
The last thing you want to do is pay persnickety little fees on top of commission. These fees will not usually break the bank, but they’re a nuisance to be avoided.
- Online reviews are an excellent thing to check
Word of mouth and online reviews are a great way to gauge between a good and a lousy consignor. People will usually be brutally honest when it comes to online reviews, and you will quickly find out the good and the bad about consignors.
- Will your RV be safe in their lot?
Keeping your RV safe and secure is crucial to a good consignment experience. You don’t want to constantly check in to make sure no one has stolen or vandalized your RV.
Consignment Selling vs Private Sale of an RV
Whether you choose consignment for your RV or a private sale, the end goal is the same. You want to unload your RV for the best price possible and make as much money as you can.
RV consignment removes much of the headache that comes with selling your RV. You won’t have to deal with people haggling and bartering, and you won’t have to answer a bajillion questions. If you’ve ever sold anything on sites like Craigslist or Facebook Marketplace, then you know how true this can be.
Speaking as someone who has sold many things through private sales, including cars and other large items, dealing with people can be downright exhausting. You might have 50 people message you with different questions, and they all expect to be first in line or have first dibs at your product.
They will also ask you questions that are either irrelevant or that you don’t know the answer to, which will eat up valuable time as you track down any previous owners or the manufacturer themselves. You will also be responsible for handling things like transfer of ownership, title work, and insurance issues, all by your lonesome.
Private sales aren’t all bad, however. There are some definite benefits to going the private route versus the consignment route. You have the possibility of making more money selling privately versus through a consignor. RV dealers will always take a percentage of the profits which means less money for you. If you’re willing to lose this income, then consignment is the way to go.
While this isn’t me, some people get a thrill out of haggling and bargaining and see privately selling their RV as an exciting challenge. They want to see just how much they can get for their troubles and maybe even get a bidding war going to drive up the price. If you want to get as much profit as possible and enjoy dealing with people, a private sale is a path for you.
Pros and Cons of RV Consignment
RV consignment has several pros and cons that you should be aware of before embarking on its path.
- Consignment is great for rural areas away from large towns.
- You’ll have more buyer options with consignment.
- Dealers want to clear up space and get your RV sold fast.
- Free storage while your RV is on the market.
- Removes the hassle of dealing with people.
Let’s take a more detailed look at each of the above benefits of selling via consignment.
Consignment Is Great for Rural Areas Away From Large Towns
If you live out in the country or away from areas with large populations of people, it’s only reasonable to know that you’re going to have fewer people seeing your RV. Consignment provides the most exposure possible to your RV as it will be marketed online and in-store.
You’ll Have More Buyer Options With Consignment
As mentioned above, the consignment will provide as much exposure as possible to your RV. The more people that see it, the more likely it is to sell.
Dealers Want to Clear up Space and Sell Your RV Fast
The longer your RV sits in a dealer’s lot, the longer the dealer isn’t making money on it. By consigning your RV, the dealer will work hard to ensure that your RV gets sold fast and for a good profit. It’s their money that’s at stake, too, and they want to make as much of a profit as possible and quickly.
Free Storage While Your RV Is on the Market
Not everyone has space on their property to store an RV while it’s waiting to be sold. Storing your RV privately can be expensive, and those costs will add up quickly. It will also be more challenging to show your RV to prospective buyers if you have to go through your storage landlord every time someone wants to take it for a test drive.
By going through an RV dealer, consignment offers the opportunity for free storage until your RV is sold. A dealer will not typically charge anything for storage but will only take a cut of the final sale.
Removes the Hassle of Dealing With People
This isn’t a big deal, but to others, it’s the biggest deal of all to others. If you like dealing with people and making deals with them, private sales are a fun and exciting experience. If you find working with people a hassle, however, then RV consignment will save you a lot of headache and pain.
Cons of RV Consignment
- Commission can be a killer.
- You can’t use your RV while it’s under consignment.
- The cost of consignment insurance can be a pain.
- You can’t sell your RV anywhere else while it’s under consignment.
Let’s take a deeper look at these cons and what makes them such a drawback.
Commission Can Be a Killer
Whether your RV dealer takes a percentage of the profit or anything over the asking price as their commission, you will lose some money on the sale. This cost could be offset by the fact that an RV dealer might be able to get more for the sale than you can in a private sale. This isn’t a guarantee, however, and it’s risky to base your decision on these hopes alone.
At the end of the day, an RV dealer will try to make as much money on your RV as possible, but they will also cut a deal if it means quicker turnover. With a private sale, your destiny is in your own hands, and you don’t have to rely on the judgment of another party.
You Can’t Use Your RV While It’s Under Consignment
This is a huge drawback to avid campers. You’ll get the most money for your sale if you sell during the summer and spring months because that’s the hot time to go camping. However, it’s also when you will want to go camping, and if your RV is under a consignment agreement, you won’t be able to do so.
The Cost of Consignment Insurance Can Be a Pain
Your standard RV insurance may not cover incidents that occur while at an RV dealer. Because it’s under a private contract, you may need different insurance to cover the cost of incidents on an RV dealer’s lot. Consignment insurance might not sound like much, but it can add up when compiled on top of your other insurance. These costs can turn into a hefty monthly bill if you don’t watch yourself.
You Can’t Sell Your RV Anywhere Else While It’s Under Consignment
Because your RV is under contract at an RV dealer’s lot, they and they alone own the rights to sell your RV. This means that if you happen to run into someone looking for an RV, you won’t be able to sell it to them privately. This can be a drawback because you could lose out on a big profit.
How Does the Sale Process Work?
The sale process is plain and simple with RV consignment. Once you turn your RV over to the dealer for consignment, they are responsible for taking care of and market your RV until it’s sold. They will handle all of the paperwork and all the title work that goes along with selling your unit.
The process is quite simple for you as the owner. You will not have any direct contact with prospective buyers, and once you sign the title out of your name, that’s it for you. The dealer will take their cut of the profit and give you a check for the rest. As long as you know the pros and cons in the lists above, you will know what the proper selling path is for you.
RV consignment is a godsend for some and a trap for others. It’s important to know what you’re getting into with consignment and what to expect from the dealer you’re working with. Essentially, you trade money for convenience and ease, and maximum selling possibilities.
As long as you’re ok with making this sacrifice and getting a little bit less money, RV consignment is the way to go for you. If, however, you value making as much money as possible on the sale of your RV, then a private sale might be worth the hassle of dealing with people to get the most out of your RV. No matter what you choose, it’s always best to know what you’re getting into and what to expect.