Consignment stockبضاعة الأمانة (كونساينمنت)

Consignment is goods sitting in your shop that are not yours. A supplier puts a stand and stock with you; you sell from it; you owe them only for what actually sold, and only once they invoice you. It is a common arrangement and a very easy one to record wrongly.

This differs from business to business. Know how the arrangement actually works with your consignor before modelling it.

1. What goes wrong if you treat it as a purchase

The tempting shortcut is to receive the stand as a purchase and be done with it. Two things break at once:

• Your stock value is wrong. Ask for the value of your inventory and it includes goods you have not bought and may hand back. The figure is not yours.
• Your payables are wrong. You are showing a debt for the whole stand when you owe only for the three units that sold.

The rule underneath: you may hold ten of them, but they are not yours.

2. One warehouse per consignor

Give each consignor their own warehouse. The warehouse record is defined in General setup → Inventory control setup, where Warehouse is one of the tiles, and the training names them after the consignor (Consignment - <consignor name>) so the list tells you whose goods each one holds at a glance. They sit in the same list as your own warehouses, and the name is what keeps them apart:

The warehouse record itself carries Name, Address, Phone, Area and Height, an Intermediate warehouse picker, and a set of behaviour flags:

Does not affect onhands is the one that matters here, because it produces exactly the behaviour consignment needs: goods you are holding and can sell, that do not inflate the stock you report as yours.

Set it when you create the warehouse. On a new record the box is available; on a warehouse that has already been saved it is greyed out. Like PID on an account and List on an auxiliary record, this is a decision the record locks after the first save.

The warehouse ribbon also offers Cost center link and Link account, so a warehouse can be tied to a cost center and to a chart account.

One warehouse per consignor, not one for all of them. Two suppliers with stands in the same shop are two separate stock positions to reconcile and two separate people to pay, so keeping them in one warehouse just recreates the problem you are avoiding.

3. Move the goods in as a transfer, not a purchase

When the stand arrives, record a warehouse transfer into that consignment warehouse. A transfer moves stock without buying it: no purchase, no payable, no effect on what you owe.

Now your ordinary stock reports cover your own goods, and the consigned goods sit visibly apart in their own warehouse where you can still see and sell them.

4. Sell from it, and only then buy

Sell from the consignment warehouse as normal. Each sale takes a unit off that warehouse, so at any moment the warehouse tells you how much of the consignor's stock is left and how much has gone.

When the consignor sends an invoice for the units that sold, then you record the purchase - for those units only. That is the whole flow:

transfer in  →  sell (virtually, from their stock)  →  their invoice  →  purchase

You sell them virtually until the invoice arrives; the purchase, when it comes, is for exactly what sold.

Libra's shipped chart has an account for the payable side of this: 4611 Accounts Payable - For Consignments, sitting beside 4619 Others under 461.

5. The top-up visit

Consignment arrangements run on the rep's visit. He comes by, your warehouse says six units, he counts four on the stand, and he leaves two more to bring it back up. Record that top-up as an inventory count against the consignment warehouse so the system agrees with the shelf.

That count is also the moment the two of you reconcile your warehouse figure against his physical count - which only works if his goods were never mixed into your own stock in the first place.

Next: Suppliers · The chart of accounts · Key rules.