Handling Consignment Stock

Consignment inventory is a business arrangement where a supplier (consignor) provides goods to a client (consignee) who then sells the goods, but the supplier retains ownership until the goods are sold. The client doesn't pay for the inventory until it's sold or used, and unsold/un-used items can be returned to the supplier.  Due to this, it is important to ensure that ALL stock movements of consignment stock in any direction are costed at $0.  You can confirm this via consignment product's stock movement history.

WorkGuru supports consignment stock, but requires a specific workflow to ensure both the stock control and accounting requirements are met.

• Consignment Warehouse
• Consignment Stock
• Receiving Consignment Stock
• Consignment Stock Usage on Project
• Consignment Stock Dispatch on Stock Sales
• Supplier (Consignor) Notification of Usage
  • Projects
  • Stock Sales
• Returning Unused Consignment Stock

Consignment Warehouse

Create a consignment warehouse so you can separate and easily identify consignment stock from your regular inventory.

Consignment Stock

If not already setup, add or import the consigned products as standard FIFO/Serial or Batch products. There is no specific product setup required to support consignments.

Receiving Consignment Stock

Receive consignment stock sent from the supplier via a stock adjustment.  Adjust the received consignment stock INTO the consignment warehouse, ensuring the unit cost is ZERO ($0) dollars.  This is an important step as the consignor still owns the value of the stock, so we do not want to increase your stock on hand value.

Consignment Stock Usage on Project

Use your consignment stock on the project as normal via the Quick Action menu's Use Materials button. Ensure the consignment Warehouse is selected before adding the usage to display the current consignment availability.

The consignment stock will be used on the project correctly at no cost (remember you don't pay for it until it is used).

Depending on your consignment agreements, raise a project or advanced purchase order to send to the consignor supplier to notify them we have used consignment stock and are expecting an invoice. This will then track the correct cost and profitability on the project once invoiced.

Consignment Stock Dispatch on Stock Sales

Create and approve a stock sale ensuring that the unit Cost is $0 consignment Warehouse is selected to display the current consignment availability.

Complete or dispatch the Stock Sale as required. The consignment stock will be dispatched correctly at $0 (remember you don't pay for it until it is used). 

Supplier (Consignor) Notification of Usage

Once consignment stock has been used or dispatched, you need to pay for these goods to recognised COGS and profitabilty. Notify the supplier via a purchase order to prompt them to invoice for the value of the stock used.

Projects

Depending on your consignment agreements, raise a project or advanced purchase order to send to the consignor supplier to notify them we have used consignment stock and are expecting an invoice. This will then track the correct cost and profitability on the project once invoiced.

Stock Sales

Depending on your consignment agreements, raise a related cost purchase order to send to the consignor supplier to notify them we have used consignment stock and are expecting an invoice. This will then track the correct cost and profitability on the stock sale once invoiced.

Returning Unused Consignment Stock

If any consignment stock is no longer required, or has been requested to be returned to the supplier. Remaining consignment stock on hand can be checked in the stock dashboard.

Simply adjust the returned consignment stock OUT of stock.