Consignment auctions: A proposed optional channel for reverse logistics

Marvin Lovett, The University of Texas Rio Grande Valley

Abstract

This paper addresses the proposed utilization of the C.A.L.M. Method-The Consignment Auction Liquidation Marketing Method of Mass Product Distribution-as an optional secondary market channel for reverse logistics requirements. This nontraditional method of product distribution was initiated over twenty years ago and can provide business organizations a further option for reverse logistic needs. Consignment auctions depend on securing good sources of merchandise sold at their auctions. Many business organizations including retailers, wholesalers, manufacturers and entrepreneurs often have excess and returned merchandise and can benefit from additional secondary market channel options to meet their reverse logistics needs. A review of both reverse logistics and consignment auctions is followed by a discussion of the advantages and disadvantages of utilizing consignment auctions for reverse logistics needs. The broad availability and placements of consignment auctions in the United States is presented. In addition, general guidelines for utilizing consignment auctions as an optional secondary market channel for reverse logistics needs are provided. Also, online auction options are compared to traditional consignment auctions. Finally, the concept of “multi-channel reverse logistics” is introduced and recommended.