Once you've completed this tutorial, you'll be able to:
✔ Create new locations to handle consignees
✔ Initiate a Stock Transfer to move product to a consignee
✔ Initiate a Stock Transfer to move product back to your location
✔ Record sales of product from a consignee
This tutorial should take approximately 18 mins to complete.
Consignment selling essentially involves providing your goods to a external party (consignee), where the consignee then agrees to try to sell your product in exchange for an agreed on commission fee.
With consigning, until the product is sold, the product remains yours and is still considered part of your inventory. For this reason, it is essential that it is tracked accurately while in the external location.
The Consignment feature is used to track inventory sold from consignment locations and consists of four concepts all working together: Locations, Pricing Tiers, Transfers and Orders. Let's briefly introduce these concepts before we move to how they all work together.
Firstly, Locations are used in order to record details about your consignment locations, such as the name and address of the shop.
Transfers are for moving stock between different locations. The most common scenarios you'll be using is moving stock from location to external location in order to provide stock for sale to a consignee. Stock Transfers are also used when unsold stock is returned to you. Whenever a transfer is created, the stock is allocated to the location. If the to location is a consignee, you'll also notice it will be removed from your Available stock inventory totals.
Pricing Tiers allow you to set custom price points for your products for any location - in doing so, you will be creating price lists for your consignees.
Finally, Orders are the way that you record sales made at the external consignee location. These orders are almost identical to the ones you will have been creating for your direct sales - the main difference being that a location needs to be entered in order to reconcile the sale with the stock.
Your default home inventory is called the Main location. Your stock is assumed to reside in your Main location by default. Stock can be transferred both to and from the Main location to any location you create.
Locations can be added directly via your Locations list page, which can be accessed via the quick menu option.
Stock can be transferred to a location by creating a Stock Transfer. The stock transfer details the locations involved in the transfer, the date in which the transfer was actioned and all stock involved.
On the Transfer form, the first fields you'll see are for setting the locations you wish to transfer to and from.
Your From Location will be the place where you are taking the stock from - your Available stock at this location will be reduced by the amount you are moving to indicate that this stock has been removed from your accessible stock. The To Location is the location where you are wanting to move the stock into. This action will increase the Available stock at this location.
In order to transfer stock from your own location to a consignee, you'll want to make sure that your From Location is set to the default of Main. This is the default location for your inventory and indicates your own stock warehouse.
The next section is for selecting the products and quantities you are sending to this location. You can add in as many products as you need here: just click the Add Product button to add new rows when required.
The process of accounting for stock returned to you from a consignee is exactly the same: you'll want to create a Stock Transfer again only this time with the From Location as your consignee location and your To Location as Main. All stock returned will need to be added under the Transferred Products section.
To create custom prices for your consignment products, you can create a Pricing Tier and then associate this tier with one or many locations. From here, each of your products can then have a unique price set for the tier - this will appear automatically when logging new orders and will also factor into your consignment reporting.
When a consignee sells stock, an order for the location should be created containing the sold stock. This will decrease the available stock on hand and also increase the sold count for the location. If a price point has been configured for the product(s) sold, the price for the location will be populated automatically.
If you have any additional questions, please get in touch and we'll be happy to give you a hand. Alternatively, feel free to join and post your question in our official Craftybase Facebook group.
For more information on consignment strategies for handmade sellers, download our FREE eBook. Our eBook introduces online craft sellers to the absolute basics of consignment in an easy to understand way, giving you the knowledge and confidence to begin planning your strategy.