konsignaatio

Konsignaatio, or consignment, is a commercial arrangement where goods are provided by a consignor to a consignee to be sold on the consignor’s behalf. The consignor retains ownership until a sale occurs, while the consignee acts as custodian and seller. The setup is common in retail, galleries, and other trades where suppliers seek to avoid tying up capital.

Under a typical contract, the consignee markets the goods and handles customer transactions. When a sale occurs, the buyer pays the consignor’s price, and the consignor receives the proceeds minus the consignee’s commission. If items do not sell within the agreed period, they may be returned or renegotiated. The contract may authorize discounts or promotions.

Accounting and risk: the consignor records the goods as inventory until sale; the consignee holds them as consignment stock. Revenue is recognized by the consignor on sale. Risk of loss or damage generally remains with the consignor, unless the contract states otherwise. Taxes, such as VAT, vary by jurisdiction and are typically defined in the agreement.

Advantages include broader distribution with lower upfront risk for the consignor and product access for the consignee. Disadvantages include cash-flow delays, potential disputes, and the need for clear terms. Consignments are common in fashion, books, art, antiques, and online marketplaces, with terms covering duration, returns, commissions, and storage responsibilities.