Worked scenario
Our material, their yard, nobody's count
Consignment stock is inventory you own and cannot see, and reconciliation disputes are settled by whoever has a record.
3 min read
Placing stock at a customer's site shortens their lead time and ties up the supplier's capital in a place the supplier does not control.
Consumption reporting is the weak point
Billing depends on the customer reporting what they used. Where that is informal, under-reporting is not usually deliberate — it is simply not anyone's job at the customer's end.
Ageing by location
Consignment stock that has not moved in a year is capital sitting somewhere else. Without ageing by site, it is invisible in a total that looks like healthy inventory.
What changes
- Consignment placements recorded per site and per item
- Consumption reported on an agreed cycle
- Physical counts scheduled rather than triggered by disputes
- Ageing of consignment stock visible by location
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