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What is Consignment Inventory and How Does It Work?

. Consignment is a form of stock that can be sold on behalf of the owner by another party. It differs from normal inventory in that the consignor retains ownership of it until the consignee sells it; however, once it has been sold, any profit goes to the consignee instead of back to the original owner. Sellers and manufacturers benefit from consignment agreements because they reduce the risk that their stock will become obsolete before they can be sold at full price; conversely, buyers benefit because they don’t have to incur extra costs related to manufacturing or storage when purchasing items through third parties.