inventory on consignment

inventory on consignment refers to a business arrangement where a seller places goods in the possession of a retailer or distributor, but ownership of the items remains with the original supplier until they are sold. The supplier retains the risk of unsold goods and typically only receives payment once the product is sold. This type of arrangement is common in industries like retail and wholesale, allowing retailers to offer a broader selection of products without upfront investment. Consignment inventory helps businesses manage stock levels while minimizing financial risk.