By consignmentpos October 30, 2025
A retail POS is built for merchants who buy goods outright, own inventory the moment it hits the shelf, and recognize the cost of goods sold at the time of sale. A consignment POS is designed for stores that sell goods on behalf of consignors, where the store (consignee) does not own inventory and instead pays out a negotiated split when items sell.
That single legal distinction—ownership—reshapes how each system handles inventory, pricing, payouts, tax, reporting, and even customer service. In the U.S. market, where state sales tax rules, card brand requirements, and privacy laws vary, choosing the right platform matters for daily operations and long-term profitability.
With a retail POS, workflows are optimized for purchase orders, receiving, barcoding, shelf replenishment, markdowns, promotions, and real-time stock counts. Margin tracking is centralized, and the software emphasizes supplier performance, reorder points, and SKU velocity.
By contrast, a consignment POS prioritizes consignor onboarding, intake agreements, splits and fees, price approvals, inventory aging, and automated settlements. The platform must calculate what is owed to each consignor, track unsold items for return, and keep a clean ledger of payouts and liabilities.
Because retail POS and consignment POS anchor different business models, mixing them or trying to force one to act like the other often creates reconciliation headaches. A retail platform can record consignor items as vendor inventory, but it will struggle with split payouts and aging schedules.
A consignment platform can ring up store-owned inventory, but it needs additional controls for cost accounting and purchase orders. Understanding these differences up front helps U.S. retailers select software that fits their merchandise strategy today and scales with tomorrow’s growth.
Ownership, Accounting, and Liabilities in Retail POS vs Consignment POS
Ownership drives accounting. In a retail POS, the store books inventory as an asset when received and moves it to COGS at sale. Profitability is SKU-level: price minus cost, adjusted for discounts and freight. In a consignment POS, the store typically carries little or no inventory asset because goods are owned by consignors.
Instead, the system tracks a liability—amounts owed to consignors after sales, fees, and adjustments. That liability must be accurate daily, survive returns, and reconcile to actual payouts.
This difference affects every report. Retail systems emphasize gross margin, sell-through, days of supply, and vendor contribution. Consignment systems emphasize net proceeds by consignor, settlement dates, aging buckets, and intake exceptions.
In the U.S., many consignment shops issue year-end statements to consignors and may collect tax forms when payouts exceed federal or state thresholds.
Meanwhile, processors may issue 1099-K to the business for card volume; stores may also need W-9 collection and may issue 1099-NEC or 1099-MISC to consignors depending on their tax advisor’s guidance. Your consignment POS should help keep records tidy without offering tax advice.
Returns and chargebacks flow differently too. In retail, a return reverses revenue and restores store-owned inventory. In consignment, a return also reopens the consignor’s item and reverses any pending payout.
If the shop already paid the consignor, the consignment POS must create an offset or debit on that consignor’s ledger. Robust ledgers, audit trails, and settlement detail become non-negotiable requirements for stores choosing a consignment-first platform.
Inventory Intake and Catalog Management Workflows
A retail POS focuses on purchase orders, vendor catalogs, UPC mapping, and standardized product data. Receiving is streamlined: scan the ASN or PO, confirm quantities, print barcode labels, and stock the floor.
The system tracks landed cost, pack sizes, and case breaks. It supports automatic replenishment using min/max thresholds and suggests buys based on historical demand. The goal is predictable margin and clean stock levels.
A consignment POS flips the intake script. Items arrive piecemeal from many consignors, often unique or one-off. The workflow centers on fast intake: capture item title, category, condition, images, optional notes, and a base price or price range approved by the consignor.
The platform must generate labels for items without UPCs, handle duplicate descriptions, and link each item to a specific consignor agreement. Because pricing can be negotiated, the system should save the original asking price, the approved price, and any automatic markdown schedule.
For U.S. businesses, labeling and auditability matter. You need barcodes for speed at checkout, but also data that proves which consignor owns which item if questions arise. A strong consignment POS tracks item provenance, intake date, and age, and can automate workflows such as “return to consignor after 90 days” or “mark down by 10% every 30 days.”
Meanwhile, a retail POS relies on SKU normalization, vendor cost updates, and seasonal catalogs to keep thousands of items coherent across stores and eCommerce.
Barcoding, Photos, Aging, and Markdown Rules
Consignment thrives on clarity. Photos attached to the intake help cashiers authenticate unique items and help online shoppers see conditions. The consignment POS should support in-app camera capture, bulk photo upload, and clear image compression to keep performance snappy.
Each item’s label should encode item ID and consignor ID, enabling fast lookups, accurate payouts, and quick floor audits.
Aging rules are at the heart of profitable consignment. You may set policies like 0–30 days full price, 31–60 days 20% off, 61–90 days 40% off, and then return or donate. The consignment POS should apply these discounts automatically at the register and online, tie markdowns to the item’s intake date, and record reduced proceeds to the consignor if your agreement requires it.
In retail POS, markdowns are campaign-driven—clearance, seasonal promotions, and couponing—applied by category or vendor across the catalog, with margin impact tracked against store-owned cost.
Barcoding differs as well. Retail prefers manufacturer UPCs for speed and analytics, while consignment requires store-generated labels to differentiate near-identical items. Both systems benefit from handheld counts, cycle counting, and discrepancy reports.
But only a consignment POS must reconcile physical counts to consignor ledgers, ensuring no item vanishes without a return or sale event. That reconciliation discipline is a defining difference between retail POS and consignment POS operations.
Pricing, Commissions, and Payouts to Consignors
In a retail POS, price and margin belong to the store. You set MSRP, implement promotions, and calculate gross profit after cost and discounts.
Commissions in retail, if any, are usually internal—sales associate incentives—not payouts to external owners. Reporting is SKU and vendor centric, and settlement concerns are limited to card batches and deposit timing.
A consignment POS must master payouts. Each sale splits between store and consignor per the agreement: e.g., 60/40, 50/50, or tiered splits based on sale price. The platform should deduct fees—authentication, cleaning, credit card fees (if your agreement allows), or listing fees—before computing the consignor’s net.
It must schedule settlements on a cadence you choose (e.g., weekly or monthly), roll over small balances, and support multiple payout methods like check, ACH, or store credit with bonus. Store credit bonuses (e.g., 5–10% extra) drive loyalty and keep cash in the business.
U.S. shops often require IRS Form W-9 from consignors before issuing large payouts. While the consignment POS should not provide tax advice, it should store compliance artifacts (W-9 receipt, consent to e-payments, electronic signatures on agreements) and export year-end summaries for your accountant.
When comparing retail POS vs consignment POS, ask how each handles multi-party settlements on a single receipt, how they reverse settlements on returns, and how they display per-item commission math to avoid disputes. Transparent commission calculations reduce support tickets and protect your margins.
Settlement Reports, Statement Delivery, and Dispute Prevention
Great consignment POS platforms provide statement-grade detail: item ID, title, intake date, listed price, sold price, markdowns, fees, split rate, consignor net, settlement date, and payout method.
Statements should be available in a consignor portal, delivered via email, and downloadable for tax purposes. Batch approvals let you review exceptions, settle by date range, and pause payouts for consignors with missing documents.
Disputes frequently arise around markdowns, return windows, and donated items. Your consignment POS should timestamp each change, preserve the original agreement, and capture staff initials for edits.
If you accept returns, the system must automatically reopen the item and claw back any previously scheduled payout. If you donate expired items, record the donation and optionally produce documentation for consignors who request it.
Retail systems emphasize sales dashboards and product performance. Consignment systems emphasize trust. Clear statements, searchable history, and on-demand explanations keep consignors happy and free your team from manual spreadsheets.
When evaluating retail POS vs consignment POS, prioritize the quality of settlement reports—your future self will thank you.
Sales Tax, Compliance, and U.S. Regulatory Considerations
Sales tax rules in the U.S. vary by state and sometimes by locality. A retail POS typically calculates sales tax based on product taxability, destination, and nexus rules, with exemptions for categories like groceries or clothing in specific states.
A consignment POS must do the same, but with an added twist: some states treat the store as the retailer of record even for consigned goods, meaning the shop collects and remits sales tax on the full sale price. The consignor’s share is not tax-exempt; it is simply a revenue split post-tax collection.
Your platform should support destination-based tax for eCommerce, origin-based tax for applicable states, and product-level tax categories (e.g., apparel, accessories, antiques).
It should also manage tax-exempt sales for buyers with valid resale certificates and keep digital copies of exemption documentation. Both retail POS and consignment POS need end-of-period tax reports that tie out to cash drawer totals and processor deposits.
Data privacy and payments compliance matter, too. The system should be PCI DSS-aware, tokenize cards for re-use (with consent), and support EMV and contactless to reduce chargeback risk.
For consignment, storing personal information about consignors—addresses, SSNs or EINs (when collected), and payout details—requires strong roles and permissions, encryption at rest, and audit logs.
If you sell second-hand goods, some jurisdictions require record-keeping (e.g., pawn and resale laws can impose ID capture and hold periods that are separate from pure consignment rules). A well-designed consignment POS helps you configure these local requirements while keeping your checkout fast and accurate.
Returns, Chargebacks, and Fraud Controls
In retail POS, return policies are uniform by category and season. The system manages return reasons, restocking fees, and exchanges. In consignment POS, return policies might be stricter, since payout liabilities complicate cash flow.
If you accept returns, ensure the platform automatically reverses consignor settlements and re-lists the item with correct aging. Chargeback management should include receipt copies, item photos, signature or PIN data when applicable, and staff notes.
Fraud controls that matter in both models include AVS and CVV checks for keyed transactions, velocity limits for returns, ban lists for abusive buyers, and requirement of manager overrides for large markdowns.
A consignment POS should also flag suspicious consignor activity, like repeated high-value items that are frequently returned, and provide tools to verify identity during intake. Robust controls keep shrink low and trust high in both retail POS and consignment POS environments.
Omnichannel, eCommerce, and Marketplace Integration
Modern shoppers start online and finish in store—or vice versa. A retail POS built for omnichannel syncs real-time inventory to your website, supports BOPIS/ship-from-store, and publishes rich product content to Google, Meta, and marketplaces. It handles variants, size runs, and preorders.
A consignment POS must do all of that while respecting consignor rules, item uniqueness, and dynamic pricing. When the same SKU exists in multiple conditions, photos and titles must clarify differences so customers trust what they’re buying.
Marketplace integration is especially valuable for consignment stores. Your consignment POS should push unique items to Shopify, WooCommerce, or niche marketplaces, retiring listings immediately when items sell in store.
The system must avoid oversells, sync markdowns automatically, and retain original photos for dispute resolution. Because online buyers expect fast shipping, labeling and pick/pack workflows should fit one-off items without bogging down staff.
For U.S. operations, tax collection for eCommerce is table stakes, and shipping integrations should handle live carrier rates and prepaid labels. Gift cards must work both online and in person.
Loyalty programs should award points fairly even on consigned items if your policy allows it. When comparing retail POS vs consignment POS, test real-time sync speed, listing accuracy, and how fast the system delists sold items. The right platform prevents painful double-selling incidents.
Content, SEO, and Product Data Quality
Retail thrives on consistent, vendor-supplied data. Consignment thrives on storytelling. Your consignment POS should help staff capture condition notes, measurements, brand details, and style descriptors that feed eCommerce SEO.
Bulk description templates accelerate intake while keeping listings readable. For retail POS, automated imports from vendors and GS1 UPC data ensure clean catalogs and better on-site search.
Great content reduces returns. Clear photos, honest condition grades, and size guides set expectations. Both retail POS and consignment POS benefit from structured data (schema.org) on product pages, but consignment in particular wins when descriptions reveal uniqueness.
Platforms that make content creation effortless deliver higher conversion and fewer customer service headaches.
Hardware, Payments, and In-Store Experience
A retail POS typically supports a wider range of fixed and mobile hardware: lane registers, customer-facing displays, handheld scanners, label printers, and kiosks. High throughput matters during peak seasons, so queue-busting with tablets and tap-to-pay is critical.
A consignment POS needs the same payment flexibility but adds backstage hardware for intake: photo stations, mobile label printers, and barcode scanners at the intake desk.
Payment features differ subtly. Retail needs split tender, gift cards, and buy now pay later. Consignment needs those plus payout rails (ACH for consignors), store-credit conversions, and sometimes cash-out controls.
Your consignment POS should support EMV, NFC, and encrypted card capture, and reconcile processor fees distinctly if you pass certain costs to consignors per agreement.
From a customer-experience standpoint, both systems should display promotions, loyalty balances, and return eligibility. For consignment buyers, the register should show condition notes or final-sale flags to avoid confusion.
Hardware should be durable and simple for staff to learn. When evaluating retail POS vs consignment POS, simulate a Saturday rush and a Monday intake at the same time—only then will you see how the platform holds up under real U.S. retail conditions.
Security, Roles, and Audit Trails
Because consignment shops manage money that ultimately belongs to other people, permissions must be strict. Your consignment POS should separate cashier rights, intake rights, pricing rights, and settlement rights.
Every action—price change, fee addition, payout approval—should leave an audit trail. In retail POS, permissions are still important (especially for discounts and returns), but the stakes differ: you are protecting store margin rather than third-party funds.
Backups, encryption at rest, SSO options, and staff-level activity logs are essential. If you run multiple U.S. locations, centralized controls ensure consistent policies across stores while allowing local autonomy where appropriate. This governance layer is a key evaluator when choosing between retail POS and consignment POS.
Total Cost of Ownership and Vendor Evaluation
Sticker prices rarely reflect reality. A retail POS may charge by register, by location, or by SKU count, and add fees for eCommerce, loyalty, or analytics. A consignment POS might be priced by active consignor, intake volume, storage, or settlement counts.
Consider label costs, photo storage, marketplace listing fees, payment processing rates, ACH payout fees, and potential chargeback reserves. The most expensive line item is often staff time spent reconciling what the software can’t automate.
In the U.S., payment processing can be bundled or bring-your-own. Compare effective rates, surcharging or cash-discount rules in your state, and funding timelines. Ask vendors about historical uptime, support SLAs, and data-export rights.
If you ever switch, will you get your consignor ledgers, intake photos, and settlement history in usable formats? That question matters more for consignment POS than retail because payouts depend on historic accuracy.
Pilot before you commit. Run parallel tests for at least two weeks: use the retail POS for purchased goods, and the consignment POS for intake and settlements. Reconcile end-of-day reports, then spot-check five consignors and five purchase orders. The better fit will reveal itself quickly in fewer exceptions and happier staff.
Hidden Costs, Scalability, and Long-Term Maintenance
Hidden costs lurk in manual steps—spreadsheets to track exceptions, ad-hoc photo workflows, or bolt-on apps for statements. Over time, these workarounds become expensive. A strong consignment POS eliminates outside spreadsheets for payouts and aging, while a strong retail POS eliminates manual reorder reports.
Scalability shows up during holidays: can your cloud POS handle spikes without slowing down? Can your photo storage and CDN keep eCommerce snappy?
Maintenance includes staff training, updates, and integrations. API access is essential for both retail POS and consignment POS if you plan to connect accounting, shipping, and marketplaces.
Budget for occasional integration tweaks as providers update endpoints. Choose vendors with transparent roadmaps and responsive support, because your store will evolve—and your POS must keep up.
How to Choose: Decision Framework for Retail POS vs Consignment POS
Start with your merchandise model. If most items are new, standardized, and replenished, lean toward retail POS. If most items are unique, second-hand, or supplied by individuals or dealers on split revenue, lean toward consignment POS.
Many U.S. retailers run hybrid operations—new goods plus consigned goods—and may require a platform that supports both with distinct item types and reports. Be wary of force-fitting; hybrid success demands first-class support for both flows.
Score vendors on six pillars: inventory, pricing, settlements, tax, omnichannel, and security. For retail POS, weigh purchase ordering, vendor catalogs, and promotion engines. For consignment POS, weigh intake speed, photo tools, aging rules, and statement quality.
Then validate with real data. Import 200 items, run 20 transactions, process two return cases, and produce end-of-week reports. Compare how many clicks tasks take and whether managers trust the results without exporting to spreadsheets.
Finally, involve your accountant early. Mapping POS outputs to your general ledger is simpler in retail POS and more nuanced in consignment POS. Agree on account structures for liabilities, fees, and payouts before go-live. With the right foundation, your store will scale smoothly without month-end surprises.
Migration Checklist and RFP Questions
When issuing an RFP, ask vendors to answer these specifics:
- Inventory Types: How do you model store-owned vs consigned items on the same receipt?
- Aging & Markdown Automation: Can I set per-consignor or per-category schedules?
- Payouts: Which payout methods are native (ACH, checks, store credit), and how are fees handled?
- Returns: How do you reverse settlements and re-age returned consigned items?
- Tax: How do you handle destination-based eCommerce tax and category taxability?
- Omnichannel: How fast do you delist sold items from the website and marketplaces?
- Security: What roles, audit logs, and encryption standards are in place?
- Accounting: What exports exist for liabilities, sales, and fees? Can you schedule them?
- Data Portability: If we leave, how do we export consignor ledgers, photos, and statements?
- Support & Uptime: What are your published SLAs and average response times?
Run a sandbox migration: import consignor records, agreements, and sample item photos. Print labels, ring mixed carts, create payouts, and reconcile a week of activity to your bank deposits. The platform that makes this easy is likely your best long-term fit for U.S. retail.
FAQs
Q1: Can I run both retail and consignment in one POS?
Answer: Yes—some platforms support both models with distinct item types, rules, and reports. Make sure the system can tag store-owned vs consigned items, apply different return policies, and maintain a clean liability ledger for consignors. Hybrid support is essential if your store mixes new goods with resale.
Q2: How do payouts work in a consignment POS?
Answer: The consignment POS calculates each consignor’s net from sold items by applying the agreed split and any fees, then schedules settlements (e.g., weekly or monthly). It should support ACH, checks, or store credit, and provide downloadable statements. Returns must automatically reverse pending settlements.
Q3: Do I need special hardware for consignment?
Answer: You can use the same EMV/NFC card readers, scanners, printers, and tablets as retail. However, consignment benefits from photo capture stations, mobile label printers at intake, and scanners at the intake desk. Your consignment POS should make photo and label workflows painless.
Q4: How is sales tax handled for consigned goods?
Answer: In most U.S. states, the store collects and remits sales tax just like retail, even when items are consigned. The consignment POS should apply local product-level tax rules and include consigned sales in returns and audit reports. Consult a tax professional for your state specifics.
Q5: What about IRS forms and year-end reporting to consignors?
Answer: Many shops collect W-9s and issue year-end summaries. Some may issue 1099 forms depending on payouts and accountant guidance. A consignment POS should store documents and export reports, but it does not replace professional tax advice.
Q6: Can I publish consigned items online?
Answer: Yes. Choose a consignment POS that syncs unique items (with photos and condition notes) to your eCommerce site and delists instantly when items sell in store. Fast sync prevents oversells and keeps customers happy.
Q7: How are returns different between retail POS and consignment POS?
Answer: Retail returns restore store-owned stock and reverse revenue. Consignment returns also reopen the consignor’s item and reverse any scheduled payout. Your consignment POS must automate that to avoid manual ledger edits.
Q8: Which model is better for cash flow?
Answer: Consignment POS can reduce cash tied up in inventory because you pay consignors after items sell. Retail POS requires buying inventory up front but gives you full control over margin and replenishment. The best choice depends on your sourcing and brand strategy.
Q9: What features matter most for a hybrid store?
Answer: Look for dual item types, mixed receipts, separate return rules, clear liabilities, aging automation, and consolidated reporting. A strong hybrid platform makes retail POS vs consignment POS differences invisible to your cashiers while keeping your accountant satisfied.
Q10: How do I evaluate processing fees and deposits?
Answer: Compare effective rates, card brand fees, and funding timelines. Whether you use integrated processing or bring your own, ensure the POS reconciles deposits to batches and separates any fees you pass through to consignors per your agreement.
Conclusion
The real difference between retail POS and consignment POS is ownership—and everything flows from there. Retail systems excel at purchase orders, standardized catalogs, replenishment, and promotion management.
Consignment systems excel at intake speed, unique item handling, aging and markdown automation, and precise consignor settlements. U.S. retailers must also weigh sales tax complexity, payment compliance, data privacy, and year-end reporting requirements.
If you buy inventory and drive brand-new assortments, a retail POS will feel natural. If you curate one-of-a-kind goods from a community of sellers, a consignment POS will protect trust and streamline payouts.
Many stores do both, which means your platform should do both—without spreadsheets, double entry, or reconciliation drama. Map your processes, test real workflows, and let clean reporting be your guide.
With the right choice, your checkout runs fast, your eCommerce stays in sync, your consignors stay happy, and your books close on time—every time.