What is consignment selling?

Consignment selling means you deliver goods to your customer, but only invoice once the goods have been sold. More and more businesses in retail and wholesale are choosing this flexible form of selling, because it lowers the barrier for their customers. But consignment also brings challenges. After a few months, how do you still know what’s sitting with the customer and what’s already sold? In this blog post, we explain exactly what consignment involves, what common questions it raises, and how Deskflow helps you handle your consignment sales efficiently.

What is consignment in retail and wholesale?

In practice, consignment in retail or wholesale means a manufacturer or wholesaler delivers products to a retailer without direct payment. The goods sit on the customer’s shelves, but remain your property (the supplier’s) until they’re sold to an end customer. Only at the moment of sale does the shop settle up with you for the items sold, and you receive payment or issue an invoice. If an item doesn’t sell, the shop can usually return it to you free of charge. For the retailer, this model is attractive because they carry no investment or stock risk, while as a supplier you find it easier to place your products with customers.

What are the challenges of consignment selling?

Consignment sounds ideal, but in practice many businesses find that managing consignment stock can be tricky. Especially if you try to track it manually or with standalone lists, you’ll run into a few problems:

• Limited overview: You don’t always know exactly what’s sitting with the customer, what’s already sold, and what’s still “open”. Without a proper system, you miss real-time insight into consignment stock.
• Delayed payment: You only get paid after the items have been sold. That means your income arrives later, and you need to carefully track when you’re allowed to invoice the customer for something.
• Manual admin: Without automation, you’re stuck relying on Excel files or paper lists to track consignment sales and order tracking. This not only costs extra time, it also increases the risk of errors or forgotten sales.
• Returns processing: Unsold goods eventually need to go back to your warehouse. If you don’t record this properly, you risk discrepancies in your stock records (and no small amount of frustration hunting for “missing” stock).

How do you handle consignment efficiently in Deskflow?

Fortunately, consignment doesn’t have to be a headache if you use the right software. Deskflow offers consignment functionality to keep this process running smoothly. You can put deliveries straight onto a consignment note from order picking (taking items out of the warehouse). Deskflow then records these goods as consignment stock at the customer. From there, you easily keep the overview: you can check the outstanding consignment stock per customer at any time.

As soon as the customer sells something, you convert those items from consignment to a final sales invoice with just a few clicks. Do unsold items come back? Then you simply register a return in Deskflow, so your stock levels are accurate again. This way, you track every consignment delivery and sale digitally, without the risk of overlooking anything. What used to be an administrative headache becomes a smooth and fully traceable process.

Ready to tackle consignment the smart way? Feel free to get in touch for a no-obligation conversation. We’d love to show you how Deskflow makes your consignment process a lot easier!