E1: 42: Consignment Sales (Doc ID 625644.1)

Last updated on MARCH 26, 2024

Applies to:

JD Edwards EnterpriseOne CRM Sales Order Entry - Version XE and later
JD Edwards EnterpriseOne Sales Order Entry - Version XE and later
JD Edwards EnterpriseOne Sales Order Management - Version XE and later
JD Edwards EnterpriseOne Sales Order Processing - Version XE and later
Information in this document applies to any platform.

Purpose

Overview

What is a consignment sale?

A consignment sale is a sale in which one person or company acts as an Agent (Consignee) to sell the goods from another person or company (Consignor). The goods are transferred on consignment to the Agent (Consignee) warehouse before a sale is made.

Who is the Consignor?

The Consignor is the company that is the supplier of the goods on consignment. This company is the manufacturer or distributor who owns the goods and sends them to a Agent (Consignee) who does not own them but keeps them in their warehouse until they are sold. Although the goods are sent to the Consignee warehouse, the ownership of the goods is retained by the Consignor and the Consignor inventory is not relieved until the material is sold and shipped to the end-customer.

Who is the Consignee?

The consignee is the reseller that does not own, but resells goods sent to them on consignment. The consignee never owns the inventory but keeps the inventory in their warehouse until it is sold to the end-customer.

How can EnterpriseOne handle consignment sales in the role of the Agent (Consignee) for goods on consignment?

If the company using EnterpriseOne sells goods from another company on consignment they can setup a separate company to act as the Consignor company to avoid accounting for the Consignor Inventory on the Consignee Balance Sheet. They can then use Sales Intercompany Orders with the Consignee Branch Plant (seller) as the header branch, and the Consignor Branch Plant (supplier) as the detail branch on the intercompany order.

In the following example the company using EnterpriseOne will be the Agent (Consignee). As agent the company sells but does not own large trucks. Customers call the Reseller (Consignee) for replacement parts such as tires. The Agent (Consignee) acts as a dealer for "Big Wheel Tire Co" (the Consignor).

Scope

EnterpriseOne can handle consignment sales through an intercompany sales order for clients who are acting as the agent (consignee) of the goods on consignment. If the client is acting in the role of supplier (consignor) for the goods on consignment the system can be setup using regular functionality.