Consignment agreement template is a legal contract between a retail seller and business owner about the arrangement of products sales. The agreement may give the business owner an opportunity to bring more stock into his store without having to spend money on it upfront. A well drafted sample consignment agreement can help business owner and retailer to go through the deal in an efficient way.

Consignment Agreement Format

Consignment agreement can reduce the risks for both seller and owner. At the beginning of consignment contract, The retailer does not pay the business owner until the the item on consignment sells. The seller is risking only the cost of the item he is trying to sell, and the retailer is risking only the use of a little retail space for the term of the agreement. However, the business owner need to manage the inventory level in a systematic way to control the risks.

Consignment agreement need to clearly state the duration of the contract. The time that an item should remain on consignment should be specified in the terms of the consignment agreement.

Consignment Agreement Template

There are sample agreement you can download for reference, however, you may follow the instructions to design you own sample consignment agreement for personal use.

The first key part in consignment agreement template is the background information of parties involved. For example, This Agreement is entered into between ____ (hereinafter referred to as the Consignor), having its registered office at _______ and _____ (hereinafter referred to as the Consignee), having its registered office at_______.

The second key part in consignment agreement sample is the the consignment terms and conditions. For example, The Consignor shall ship ______________ (product and commodity) to the consignee on Consignment basis at the prevailing international market prices on CIF terms. The interval between each shipment shall be approximately ____. The Consignee must try to sell the consignments at the best possible prices after obtaining the approval of the Consignor as to price, terms etc.

The third key part in consignment agreement example is the sales price and payment terms. For example, The Consignor shall at no time be responsible for any bad debts arising out of credit sales to ____ buyers. Making payments to the Consignor shall at all times be the sole responsibility of the Consignee. The Consignee shall accept the Bills of Exchange drawn by the Consignor on him at 90 days'sight with interest payable at ________ % per annum.

The last key part in the agreement sample is about related expense incurred. For example, The Consignor shall absorb insurance premium and warehousing charges up to the date of delivery to customers.