Consignment Sales

Consignment Sales refers to a business arrangement where the consignor (exporter) delivers goods to the consignee (foreign agent or distributor), who is responsible for selling the goods. After the goods are sold, the consignee remits the payment to the consignor after deducting a commission. If the goods remain unsold, the consignee may return them, and the risks and costs are typically borne by the consignor. This term is commonly used for trial sales of new products, exploring new markets, or cooperating with reputable agents. Usage scenarios include: consignment trade, exhibition sales, cross-border e-commerce overseas warehouses, etc. Precautions: 1. The consignor and consignee must sign a consignment agreement specifying commission rates, cost sharing, return responsibilities, etc.; 2. The exporter bears the ownership risk of the goods before sale, as well as storage and insurance costs; 3. Unlike Exclusive Sales, consignment does not transfer ownership of the goods, and the consignee is not obligated to purchase; 4. Unlike Agency, in consignment, the consignee sells in their own name, whereas an agent sells in the name of the principal. Consignment helps reduce the consignee's financial pressure, but the consignor's funds are tied up for a long time, so careful selection of partners is necessary.