3 Objections to Consignment in Charity Auctions

Published on 11 Mar 2019 by Auctria

3 Objections to Consignment in Charity Auctions

If you’ve ever helped plan a benefit gala, golf tournament or luncheon that raised money through an auction, you already know how much effort they take to organize.

Successful benefit auctions - ones that reach ambitious fundraising goals - offer big-ticket items that generate high bids and interest among guests. To get the most out of your investment, most organizations set aside 30 to 45 minutes for the live auction.

So, what do you do when you’ve bundled enough donations for, say, 3 or 4 “WOW-worthy” packages, but not quite enough to fill the entire time slot?

One strategy: Round out your offerings with a few consignment auction items.

What is consignment?

Consignment (in a charity auction) refers to items that are free to use in your event - you only purchase an item if it sells, at the minimum price you set. You keep everything above the price of the item. If something doesn’t sell, you don't pay a dime.

Besides the significant revenue bump, other benefits of offering big-ticket packages include the ability to identify high net worth donors in the crowd, save time in fulfillment, and elevate the caliber of the entire event.

As this fundraising tool becomes increasingly popular, questions and doubts can arise. If you’re thinking of any of the following when it comes to consignment…

  1. High-end packages cost too much for our audience.
  2. Consignment takes money out of the room.
  3. We can save money by putting these items together ourselves.
    …well, you’re not alone. Consignment travel providers hear these objections every day. Here’s an insider take on each of these important concerns.

Objection 1: Consignment packages cost too much

Often auction committee members approach consignment like this: “We’d love to be able to auction off a trip to New York or a tropical getaway, but the price point is too high for our audience. They would never buy this kind of item.”

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It’s smart to offer items within your donors’ spending capacity. That said, you never want to underestimate what donors would be willing to pay. People will pay for the right item at the right time - especially in support of a good cause.

Winspire surveys show donors who buy travel packages at charity auctions span a wide range of income levels. Even if the minimum bid is higher than your past offerings, donors will be interested if and when the right experience comes along.

Alternatively, to add excitement to a silent auction, you might utilize a niche of travel like consigned hotel stays only. Luxury properties in top destinations can be offered at a lower price point than full travel experiences.

Best of all, consigned hotel stays can be offered with zero risk or upfront cost if they don’t sell.

Objection 2: Consignment takes money out of the room

Here’s a recent email that event fundraising blog, Winspire News, received from a reader…

“We are having a discussion about the pros and cons of having consignment items in the future. Our belief is that people have only so much purchasing power, and it is preferable to reserve that capacity for items that net 100% to the cause. If we pay $3,000 for an item we sell for $4,000, it seems like we are winning, but we are losing $3,000 of giving capacity. I’m sure you are familiar with this concept and can understand, albeit not agree with it.”

At most fundraising events, this is not the case.

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Imagine if that $3,000 travel package wasn’t offered. Would the donor have gone and spent $4,000 on a fully donated item? Not unless there was an item of equal or greater value and interest to the donor – and even then, there's no guarantee they would have won the bidding.

People don’t typically come in the doors with a set budget to give away. It’s all about offering the right item at the right time.

What this means for your event: People can buy a travel package and still bid on that gift basket or raise their paddle for the fund-a-need.

Objection 3: We can save money by putting these items together ourselves

Finally, a common belief about consignment is that similar vacation packages can be donated, or at least purchased directly by the nonprofit at a lower rate than partnering with a travel provider.

One thing to consider: Many bucket-list items are not donated. Most charities are not able to procure the caliber of unique experiences that generate the highest bids - think a week at a private villa in Fiji, passes to the Kentucky Derby, or red-hot tickets to Elton John.

Donations like a weeklong getaway at a board member’s condo make great revenue generators. Just keep in mind they are subject to strict blackout dates and last-minute cancellations. Luxury travelers don’t want to be told when they can and cannot travel, so packages with flexible booking periods typically offer wider appeal.

As far as purchasing and fulfilling your own packages, there’s a lot of moving parts that come with coordinating travel. The deal that’s there today may be gone tomorrow, and buying any item upfront comes with inherent financial risk…not to mention the countless hours needed to fulfill a travel package.

When you’ve gone through all the work of putting together a fundraising auction, the last thing you want to do is play travel agent.

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Partnering with a travel provider ensures a positive experience for your winning bidders - and satisfied travelers are those who return to your event year after year, buying travel in support of your cause and encouraging friends to do the same.

If you’ve been skeptical of consigned auction packages in the past, perhaps you’re reconsidering the possibilities consignment can bring to a fundraising event.

Rather than trying to fill your entire auction with consigned packages, consider this a tool to round out your offerings and capture more travel dollars than you may have been able to get otherwise - all with no upfront cost. For more information on how to include consignment items in your fundraising and charity auctions, contact Auctria today!

Author Bio: Summy Lau
This post was created in collaboration with Summy Lau of Winspire. Winspire provides high quality travel packages and luxury hotel stays for charities to use in fundraising auctions and raffles, with no upfront cost. As Fundraising Editor, Summy brings extensive experience in nonprofit development, event fundraising and publishing to Winspire’s weekly event fundraising blog, Winspire News.