Consignment

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Shipping is the consignment action, the act of handing it to another person or agent, responsible for, or maintaining any material or merchandise but retaining legal ownership to Sold items or goods. It can be done for the purpose of delivering goods, transferring goods to auction or intending goods for sale at the store (a consignment shop ).

The verb " consign " means "send" and therefore the noun "consignment " means "sending goods to others". In the case of " consignment retail " or " consignment of sale " (often referred to as "delivery"), the goods are delivered to the agent for the purpose of sale. The ownership of these items remains with the sender. The agent sells the goods on behalf of the sender in accordance with the instructions. The shippers are known as " senders " and the agents entrusted with custody and maintenance of goods are known as "recipients ".

Video Consignment

Features

• The relationship between both parties is [the sender] and [the recipient of the goods], not the buyer and the seller.
• The recipient is entitled to receive all charges in connection with the shipment.
• The recipient of goods shall not be liable for damage to the goods during transportation or other procedures.
• Items sold at the sender's risk with profit or loss belong to the sender only.

A consignor sending goods to the recipient only transfers ownership, not ownership, goods to the recipient of goods. The sender has the right to the goods. The recipient of goods takes possession of the goods subject to trust. If the recipient turns the goods into a non-intended use in the consignment agreement, such as by selling it and storing the proceeds of sale to the recipient, a fraud crime has been committed.

The word consignment is from the French sender , which means â € Å"sign up or sendâ €, originally from Latin sender "to put the stamp", as done with official documents before being sent.

1. in return for the recipient's service, the commission paid to him by Consignor

Maps Consignment

Used store

"Consignment shop" is an American term for a used store that sells used goods to the owner (shippers), usually at a lower cost than a new item. Not all thrift stores are consignment stores. In consignment stores, it is generally understood that the recipient (the seller) pays the sender (the person who owns the goods) a portion of the proceeds of the sale. Payments are not made until and unless the goods are sold. Such stores are found all over the world. They can be a chain store, like the Buffalo Exchange or an individual boutique shop. The sender retains the rights to the item and may terminate the arrangement at any time by requesting a refund. Certain times are usually arranged after which if the goods are not sold, the owner is expected to take back (if not reclaimed within a certain period, the seller may dispose of the item at discretion).

Merchandise is often sold through consignment stores including antiques, athletic equipment, cars, books, clothing (especially children's clothing, maternity, and weddings, often not outdated), furnishings, firearms, music, musical instruments, equipment, paragliders , and toys. eBay, drop-off stores and online sellers often use consignment sales models. Art galleries, too, often operate as artist recipients.

Consignment processes can be further facilitated by the use of managed inventory vendors (VMI) and customer managed inventory (CMI) applications. VMI is a business model that enables vendors in vendor-customer relationships to plan and control inventory for customers, and CMI allows customers in relationships to have inventory control.

Consignment stores differ from charity or junk shops where the original owner hand over physical ownership and legal rights to the goods as charitable contributions, and the seller retains all proceeds from the sale. They are also different from pawnshops in which the original owner may give up the physical (but not the legal) property of the goods in return for the loan and then recover the item after payment of the loan by interest (or surrender the legal right to the item)), or alternatively may submit physical ownership and legal rights for direct payments; the pawnshop will keep all proceeds from the next sale.

In the UK, the term "delivery" is not used, and the consignment shop selling women's clothing is called "clothing agency". Although other types of consignment shops exist, there is no general term for them.

Procedures

A shipper carries their used items for inspection.

Upon reconsideration, the recipient will return items deemed unfeasible for resale to the shippers (such as torn or dirty goods or counterfeit goods, which can not be sold in some jurisdictions), receive the goods to be resold, and set the resale price target, the receiving part of it, and the length of time the goods will be held for sale.

When goods are shipped (or in some cases, after the agreed period ends), the recipient takes part of the profits and pays the sender. Unsold items are returned to the sender (who should take them within the prescribed time or hand them over to them; in some cases, the sender may agree in advance to allow the recipient to donate for charity).

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Accounting

When the vendor (goods sender) provides the goods on consignment to the distributor (recipient of goods) then the revenue can not be recognized when the control has been transferred. This can happen at the end of a certain consignment period, or the sale of goods to the final consumer. The SEC has provided an example of a consignment arrangement in question 2 of SAB Topic 13.A.2 including the following:

• The obligation of paying customers is implicitly waived until consumption or sale
• Sellers have an obligation to generate resale
• The repurchase price will be adjusted to withhold costs and interest

Codification Accounting Standards (ASC) 606-10-55-80 (implemented for public companies December 15, 2017) provide three indicators of attendance of consignment arrangements that provide the principles behind the examples that the SEC has outlined. These indicators are as follows:

• Vendors control the product until a particular event occurs, such as a sale to the end customer, or until the specified period ends.
• Vendors may request product returns or product transfers to third parties.
• The recipient has no unconditional obligation to pay for the product (although it may be necessary to pay the deposit).

This list of consignment setting indicators is not all-inclusive, so the company should also consider other indicators of transfer control found in ASC 606-10-25-30.

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See also

• Scanning based trading

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References

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Further reading

• Nissanoff, Daniel (2006). FutureShop: How A New Auction Culture Will Revolutionize The Way We Buy, Sell, And Get The Very Things We Want . The Penguin Press. ISBNÃ, 1-59420-077-7 Ã,

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External links

• Ã, "Consignment". EncyclopÃÆ'Â|dia Britannica (issue 11). 1911 Ã,

Source of the article : Wikipedia