Outright Purchase vs. Consignment for a Japanese Sword — How to Choose a Dealer

When parting with an inherited Japanese sword, there are two routes with a dealer: having it bought outright, or having it sold on consignment. Which suits you depends on whether you are in a hurry or aiming for a higher price. Here we organize the difference and how to choose a dealer.

The Basic Difference Between Purchase and Consignment

• Outright purchase: the dealer buys the sword on the spot and pays you; ownership passes to the dealer.
• Consignment: ownership stays with you while the dealer sells on your behalf, paying you after the sale minus a commission.

Outright Purchase — Quick, Certain Cash

Purchase has the advantage of quick, certain cash. Because the dealer buys the sword and takes on ownership, it is no longer your concern if it does not sell afterward. On the other hand, because the dealer bears the unsold-inventory risk, the price tends to be lower than consignment (the exact difference varies by sword and dealer).

Consignment — Slower, but Potentially Higher

Consignment offers the potential for a higher price than purchase, but it takes time to sell and may not sell at all. Ownership remains with you, and a commission is deducted when it sells. Note that the Secondhand Articles Dealer Act also treats a dealer's "accepting a consignment for sale" as regulated activity. Conditions such as the commission rate and consignment period vary by dealer, so confirm them in advance.

Which to Choose? Points for Deciding

• Choose purchase if you want to part with it quickly and with certainty.
• Choose consignment if you are willing to take time in pursuit of a higher price.

In either case, it is reassuring to consult several dealers and compare terms.

Choosing a Trustworthy Dealer, Part 1 — Check the Antique-Dealer Licence

A dealer who buys, sells, or takes on consignment of secondhand swords must hold an antique-dealer licence (issued by the prefectural Public Safety Commission) under the Secondhand Articles Dealer Act. Licensed dealers are required to display a sign (showing the Public Safety Commission's name and the licence number legibly) in a place visible to the public at their premises. Confirm this licence first.

Choosing a Trustworthy Dealer, Part 2 — Track Record and Handling of the Certificate

Beyond confirming the licence, it is good to look at the track record and whether the certificate is handled carefully. A trustworthy dealer treats procedures carefully, including checking the certificate and guiding you on the change of owner. Whether they clearly explain the terms (commission, consignment period, appraisal method) is also a factor.

The Key Premise — An Unregistered Sword Cannot Be Bought or Consigned

Neither route is available for an unregistered sword without a certificate. An unregistered sword cannot be lawfully possessed or transported, so it is outside the scope of purchase, consignment, or appraisal. First file a discovery report with your nearest police station and obtain registration before considering these (see our guide on finding an unregistered sword).

About Consultation

TOUKENZA is an online marketplace that sells listed swords and does not buy, take on consignment, or appraise swords from individuals. If you wish to sell, please consult a licensed sword dealer. Licensed dealers may consider listing via our Dealer Recruitment. For deciding whether to part with the sword, see Should You Sell or Keep an Inherited Japanese Sword?; for tax on selling, see Tax When Selling an Inherited Japanese Sword.

Disclaimer

This page provides general information and does not constitute legal advice. Procedures and requirements may vary depending on the condition of the sword and the practices of each prefecture. For decisions or procedures specific to your situation, please confirm with your nearest police station, the registering prefectural Board of Education, the Agency for Cultural Affairs, or a qualified professional.