As an online business owner, managing eCommerce consignment stock can be a complicated process. Keeping track of all the details — from inventory levels to shipping timelines and trusting that everything is accounted for — are all essential factors to consider when handling consignment items.
If you don’t know how to manage your inventory or understand which logistics policies apply best to these types of products, it can become quite overwhelming. In this post, we’ll discuss the basics of managing consignment stock in an online store so you can effectively maintain your operations confidently.
What is an eCommerce consignment stock?
Consignment means the supplier passes over their goods but does not transfer ownership or make any money until the retailer sells them to its consumers.
When the retailer sells anything, the supplier makes a profit and pays the seller a commission. If the store does not market all of the goods, they can return any unsold items to the supplier.
Retailers may fill their businesses more affordably by using eCommerce consignment stock. Furthermore, it allows suppliers to acquire brand awareness without investing additional money on promoting, selling, or exhibiting their own items. It may be a win-win situation if both parties understand and agree on the contract’s conditions.
eCommerce consignment stock management best practices
Create a win-win contact
Both the consignor and the consignee must be forthright and clear about their expectations for the consignment inventory agreement to be effective. As you complete your consignment inventory agreement, be sure to give consider the following questions:
- What portion of the purchase price will the consignee retain as a commission?
- Are there additional costs associated with stocking or promoting products?
- How long will the consignee keep the goods on the shelf throughout the consignment period?
- When are goods going to be paid for?
- Who pays the shipping expenses?
- How will the consignor get any unsold goods?
Create a mutually beneficial connection with your business partner
Remember when you were in elementary school and you learned about a bee’s bond with a flower? Bees consume nectar to nourish their colonies as pollen is transported from blossom to flower. The partnership benefits both parties. The same should be true for your agreement with your company partner. In the best-case situation, it exceeds your written contract.
You and your partner should both be in it to win it. If you are the provider in the partnership, you should do all necessary to ensure that your product is as successful as possible. If you are a retailer, you should make every effort to sell your supplier’s items as well as possible.
Use inventory management software for consignment stores
Have you ever wondered how you’re going to keep track of all your items, merchants with whom you operate, consumers, and sales? Atom8 is a powerful inventory management software, and we have a guide on how to use it to manage eCommerce consignment stock.
The application will assist you in keeping track of what is in stock and what is on order. You’ll know when it’s time to refill and may do so from within the software.
In Conclusion,
Selling on consignment may be a terrific way to generate more revenue and spread the word about your brand to a wider audience. Making a consignment agreement with a merchant may also allow you to sell wholesale to them in the future. It can only take time to cultivate your relationship and establish your reputation. Try our free eCommerce inventory management app BackOrder today to manage your eCommerce consignment stock!
