Is Consignment is covered in ERPNext?

Dear Community,

I’d like to know if Consignment is covered in ERPNext?

Because when I do a search, the result is a few Discuss posts without definite
answer or formal documentation for the correct way to do this.

And I have ask Frappe support team if this is possible, whether they have a link or documentation what is the proper way to do consignment. But I was told that Consignment is not covered yet in ERPNext, so I was told to shoot a question in this Discuss Forum.

So I’d like to ask the community, if anyone has done a workaround / tips to do this Consignment?

From Wikipedia definition of consignment:
" Consignment is the act of consigning, the act of giving over to another person or agent’s charge, custody or care any material or goods but retaining legal ownership until the material or goods are sold"

Having said that, a simple explanation in my mind about consignment is the following:

  1. If we are the supplier, we would like to track those stock items that have been dropped to customers and then every month customer would report what are sold, then we would invoice those sold items and manage customer’s payments.

  2. if we are the customer, we don’t want to track those stock items as our items because there is no obligation to pay them to supplier yet. But we need some way to see the availability of stock qty without disrupting our accounting numbers. And then after that invoice or do return, like in normal case.

I know there are other complexities and differing requirements regarding consignment which we have to adjust to follow client’s wants but those two above are usually the major requirements.

Kind Regards,

1 Like


Either I explained too long or everyone was still on holiday when I asked this :smiley:

in one simple question: Does anyone that ever does consignment for their clients have a clue or experience to share? Maybe a few simple pointers…

Thank you :pray:

Legally the stock still belong to the supplier.Just create a warehouse per customer and transfer the stock there.When the customer sells and makes return,raise sales invoice for the customer from the customer warehouse


Thanks for your reply @Fred1. I will do the settings for consignment based on your information.

Your solution looks valid for us to use.

Btw, this is from supplier perspective (one side of consignment).

What about if we are the customer side and we receive consignment items. How do we handle management of items without putting the $ in Account Payable because it is not actually our buying unless it is sold?

You just raise purchase order.when you sell you raise the purchase receipt and the invoice

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I see. I understand fully now. So we manage the stock by using the waiting qty instead of the actual qty. thank you so much for giving simple pointers but big understanding, @Fred1 :pray:


In the scenario: You are holding your supplier’s stock to be further processed or sold. You are using ERPNext as your ERP system.

Solution: Create another new company in ERP (for your supplier) and use only the WH / Inventory module to receive and send stock from that company which represents your supplier. For each warehouse where you manage such stock, create WHs accordingly. And you can use material issue, requisition etc…without touching /impacting your accounting.

Might work?


thank you for your additional information :+1:, @Not_a_countant. I will put into consideration when trying out all these inputs

Nice idea. How would the profits be accounted for in this case?

It relate to WH and finance when calculate the profits and income.
We can not use the supplier as a company wit serial item. I already tried with that. But it 't work.
We must deliveried from Supplier WH, and recceipt at retail WH. But when deliveried , Finance will calculate the income / profit for the supplier .
Any solution can solve this problem?
Currently, we must create a virtual WH with virtual serial with the same item and it still store in 2 WH, when Retail sell 1, we will deduct 1 from the supplier WH.

@tlie take a look on the case for renting, it can apply for consignment also