Re: Consignment option

How can I track and manage consignment inventory on my ecommerce platform?

Mariahalfyard
Visitor
1 0 7

I have consignees (retail stores) that are selling my product on consignment. I am sending them a number of items from my inventory and they provide me with a monthly report of the number of items (and description of items) sold per month. The items need to be taken out of inventory once sent off to the store but not billed for until sold. How can I manage my inventory on shopify with these types of customers?

Does Shopify have an option to track the consignment items and then invoice the consignees accordingly? Would I need to create an order for each item (multiple orders for the same retail store)?

I sell the same items directly to customers (B2C) via my website as well so I need to have both options available on the same platform.

Replies 33 (33)

MrP
Excursionist
49 0 8

Hi Maria,

I am also looking for this option.  I'm wondering if you have since had a response or found a way to do this on shopify without the need for an app?

Borgioni
Visitor
2 0 2

I'm looking for the same solution! Is there an app that would provide this capability? I'm surprised that Shopify have not suggested a solution to this yet...

MrP
Excursionist
49 0 8

you need to create an order for the consignment stock but save it as a draft then when it sells you mark it as paid and fulfil it but obviously you don't send it

Dirk
Shopify Staff
2396 255 526

Hey, @Mariahalfyard 

As @MrP mentioned, draft orders would be a way to go about this. But depending on how many consignees you have and the number of draft orders that you need to manually create, it may become time-consuming to do.

The easiest way to set up a consignment store would be to use a marketplace app. We have the following options in our app store:

Each one works differently but the potential is there to automatically pay 'commission' to your consigners. You could also let them set up an account to make it easier for them when they return. I would check directly with the app developers with regards to how the commission is paid out. I believe they use Paypal for that but they may not all be the same.

If there is anything else I can help you with, please let me know.

Dirk | Social Care @ Shopify 
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KiriSchumacher
Shopify Partner
13 0 13

Hi Dirk, I am also looking for consignment software as a consigner. I appreciate your message from July 2021 and wonder if your advice has changed at all since then?
I posted a post in Shopify Discussion called 'Consignment software (For consigner)' on the 4th April 2022 if you'd like to take a look at my notes on the topic. 

 

EugeneTham
Visitor
2 0 3

Hi Dirk, 

 

Thanks for your solutions but the apps you provided are more applicable for Consignees. I have the same requirement as @Mariahalfyard and @KiriSchumacher where we have products that we pass over to others to sell. Creating a draft order wouldn't work as we can only bill our consignees based on which products of ours they have sold. eg. A consignee holds my inventory of 20 shampoo bottles... and only 5 are sold in the first month, I can then only bill them for the 5 bottles, not all 20. 

KiriSchumacher
Shopify Partner
13 0 13

Hi @EugeneTham  

 

You might be interested to hear that in the end I transitioned to Airtable which is essentially a fancy version of Excel and costs NZ$28 per month. I am blessed in that my partner is a software developer and has spent many hours setting up Airtable up to suit my specs. Airtable is complex and there's a lot of room for major error (like accidentally deleting all products etc!) so I wouldn't recommend it unless you're technically confident.

 

I researched an astounding number of platforms before making my decision: 35 platforms! And none of them suited, even though I have fairly basic consignment software needs. There are higher priced options out there, but my budget is NZ$200 max per month.

 

Most consignment apps are designed for the retailer selling the consignment goods, rather than the manufacturer of the goods (in my case I"m a manufacturing jeweller supplying to retail galleries). I used Tradegecko for many years, it really was amazing consignment software. But they no longer offer the plan.

 

My top consignment software pics were:

  1. Orderhive (most similar to Tradegecko) but I found the customer service inconsistent, it's reasonably expensive, and I never managed to find out if they could cater to all my software needs... they never replied to my repeat emails requesting more information.
  2. Swim - this app is specifically for jewellers. It's very comprehensive but its UX is challenging and would take a while to get your head around. Amazing customer service. But they don't allow invoice dates to be backdated (this feature is essential for my business).
  3. Tidy - this is a nice New Zealand based company but they lacked a lot of necessary features such as the ability to bulk upload / download information.

It would be sooo great if Shopify would consider creating consignment software but it's not possible at this stage because they only offer limited warehouses. 

 

Feel free to reach out with any other Qs, I spent a huge amount of time researching the options and I'd be happy if others could benefit from what I learned.

lalisimone
Excursionist
12 0 12

I responded to your other post in a different discussion. I too use Airtable for my consignment items. And I like it but it is very manual and time consuming. I wish I could automate it. I am considering using WeWeb to create a tailored app for my consignment needs and have it be more affordable. Vendor Consignment is a Shopify app that might suit my needs but the reviews are mixed and I'm hesitant because of that. 

 

Glad you found your solution. And lucky you that your spouse is a developer.

KiriSchumacher
Shopify Partner
13 0 13

Thanks for your thoughts @lalisimone. All the best with it. WeWeb sounds interesting, if you end up going with this I'd love to hear how it goes. 

 

Cool to hear that you use Airtable too. We've automated it a lot, perhaps you could hire a developer to make some Airtable automations for you? 

 

In terms of apps that can work well with Airtable: we ended up using CloudConvert directly from extension scripts for document generation (i.e. to be able to generate pdfs of invoices and consignment transfer documents directly from the Airtable data), and we're using Make.com for syncing the Airtable invoices to Xero. 

EugeneTham
Visitor
2 0 3

Hi @KiriSchumacher

 

Thank You so very much for your sharing. It really does help. Will definitely give the softwares a try and let you know if I come across others as well. 

 

Pburt16
Excursionist
18 0 17

 @KiriSchumacher , I wanted to thank you for all of your posts regarding inventory management for consignees with Shopify. I greatly appreciate you sharing the details of your research and experimentation. I'm currently trying to find a solution for this and I am not surprised in the least that:

  1. Shopify can't do this. Shocking.
  2. 99% of all software and apps are developed for the consignee.
  3. Most of the recommendations from other users show they have zero reading comprehension.
  4. Shopify support recommends apps for consignees (because they can't read either).
  5. Recommended apps are very expensive to obscenely expensive enterprise solutions.

Basically, my only option is to use a $*#!&% spreadsheet ... And I have no clue how to do this and then do whatever I have to do within Shopify to manage consigned product that sells. Almost considering not dealing with consignment at all because managing it Shopify is such an unbelievable pain in the a**.

KiriSchumacher
Shopify Partner
13 0 13

@Pburt16 Gahh... I hear you. It can be so frustrating and time consuming trying to find a solution. And equally frustrating that most companies misunderstand and think that we are the retailer of the consignment goods, rather than the wholesaler. It would be wonderful if Shopify would consider building an app for our needs, then we could manage everything in one place. Wishing you all the best with it. 

KiriSchumacher
Shopify Partner
13 0 13

Thanks for your post @Mariahalfyard I am looking for exactly the same thing. I'm curious as to whether you found suitable software? If you're interested, I also posted a post in Shopify Discussion called 'Consignment software (For consigner)' if you'd like to take a look at my notes on the topic. 

Borgioni
Visitor
2 0 2

@KiriSchumacher Were you able to finally find a good App for this, that integrates with Shopify, or are you still using Airtable? It seems like such an easy request and I'm so surprised that no one figured it out yet. We used Lightspeed before but they closed down a few years ago. Someone suggested to use Locations in Shopify to manage inventory for the reseller network, but it doesn't solve the issue with memo's/consignment - partial invoicing etc.

KiriSchumacher
Shopify Partner
13 0 13

Thanks for checking, I'm still using Airtable and it's working well (after lots of initial customisation by a developer). Would LOVE shopify to cater for our needs though. 

lalisimone
Excursionist
12 0 12

Hi @Borgioni - this is my use case: 

 

I sell vintage clothing on my shopify e-commerce site, at other stores, and at popups.

My inventory is either store-owned or from consignment (people bring me things to sell. they get paid when their things sell.

 

  • I am on the basic Shopify plan with an allowance of 4 store locations.
  • I use the Vendor Consignment app to manage, track my consigners inventory and sales. They get access to a portal where they have their own dashboard.
  • I use Shopify locations to track inventory and sales where they are happening (see another comment I posted in this thread for how I set that up)
  • As long as all of my inventory, owned or consigned, is in Shopify, and every transaction is rung up through the POS app, it will update my inventory and the consigners.

I don't use invoicing or memos, but there are apps that offer that functionality. It just means that your Shopify has to be your central database, connected properly to the various apps to establish the workflows and outcomes that you want to achieve. 

 

Hope this helps.

 

Judith

There's one app that I'm exploring and might consider replacing Vendor Consignment: That is Puppet Vendor. This has more robust features than vendor consignment. 

I each place that I sell I have configured a store location. From the Shopify POS app (non-pro version), I 

lalisimone
Excursionist
12 0 12

Hi @Mariahalfyard @KiriSchumacher and @Borgioni. I commented on this thread a while ago. I was and am no longer using Airtable to manage the consignment that people brought to my store. Today I am using Vendor Consignment instead. It has limitations but it does 90% of the job that I need it to do to manage consignment. It's also far more automated than Airtable which is helpful if you don't have developer resources at your disposal.

 

But in reference to both of your use cases, there is a way to track sales of your inventory in Shopify that sell at other retail locations. At one point, I was doing draft orders. It worked but not better than the solution below.

 

Here are the steps

1) Go to Shopify settings then Locations. Create a new location named after the store that sells your inventory.

2) for extra tracking detail and redundancy, create a customer with the name of the store. Make sure to uncheck the tax box for that customer. In my scenario, the shops that sell my inventory collect the sales tax and report it under their business entity. So your pseudo customer shouldn't be charged sales tax. If it's different for you, then leave the box checked.

3) Install the Shopify POS on your phone if it's not already installed. Go through the setup steps

4) Once installed, switch locations to the new store that you created. Go to the settings, and set up a custom payment. What I did was create a custom payment named after the store.

5) When my product sells at other retail locations, I open up the Shopify POS app and  switch to the corresponding location in the settings.

6) I always add the corresponding pseudo customer to the order, then add the products that were sold in the transaction. 

7) for the payment type, I choose the custom payment I created for that store. 

😎click done.

 

Voila your sales from the other retail locations are now tracked in your Shopify and deducted from your overall inventory. Over time, you will see in the Shopify dashboard how each retail location is performing against the rest of your sales channels.

 

Things to note: This method will skew your AOV (average order value) and LCV (lifetime customer value) metrics. Creating the pseudo customer is optional. I like to use it because in the event that I overlook switching locations, I have assigned the order to the pseudo customer and can track sales that way as well.

 

Pro tip: Once you have created the new store location, it's up to you to add/transfer inventory to that location in Shopify. It might help with understanding how much of what is where. When you run the sale in the POS app, inventory will be deducted from whichever store location it's located at.

I keep my inventory in my default location. When I run the order in POS app from a different location, it'll warn me that the inventory is sold out or not available, but I click "sell anyway" and the order goes through.

 

I hope this helps! I'm curious to hear how it works out for you. Feel free to ask questions.

 

Best of luck!

Judith (lalisimone.com)

ali_ümayrest
Visitor
1 0 1

Hi Judith - thanks for sharing your solution, this is exactly the kind of solution we've been looking for!

The part we're stuck on - is there a way to manage processing payment by multiple people at multiple locations? Not sure if it's a combo of your solution plus POS Pro?

Appreciate any thoughts or suggestions you might have!

Ali (umay.rest)

lalisimone
Excursionist
12 0 12

Hi @ali_ümayrest - I'm glad it's working for you. If I'm understanding your question correctly, I don't see why not. This would have to be validated by a Shopify rep, but I believe that store locations would be accessible across all of your POS devices, as well as the pseudo customer that is assigned to the order.

 

I believe, however, that each POS instance would need to have the custom payment configured that corresponds to the proper location. 

 

I looked up the difference between POS vs POS Pro. It's possible that you would have to upgrade to POS Pro if you wanted to each person transacting sales to have a unique pin/login. If that's not important to you, it looks like the Starter POS could work and everyone uses the same pin/login. Again, worth validating with a Shopify rep.

 

What's included in Retail - this is POS Pro

2 admin accounts
Unlimited POS logins
Simple online store
 

What's included in Starter

1 admin account
1 POS login
Simple online store
TeenVinij
Tourist
3 0 2

I've spent a ton of time😓 searching for consignment software and a point of sale (POS) system that's both good and easy to use, all without breaking the bank. It's been quite a journey, and you know that starting a business means dealing with a ton of stuff.

 

I was almost about to go for Resaleworld's Liberty Consignment, but it costs a whopping 😢😭😭 almost -$2,000! I mean, seriously, OMG! So, I'm looking for more budget-friendly options to handle my online sales. Your advice could be a lifesaver, helping me make the right call without emptying my wallet. Thanks a million for your help!

lalisimone
Excursionist
12 0 12

I'm glad you found the post and this solution. $2000/mo is out of control! Wow. And frankly not worth it in my opinion.

TeenVinij
Tourist
3 0 2

I'm looking for some app suggestions for handling invoices and memos in my consignment store. I also need to create clothing hang tags with barcodes, prices, and SKU numbers. Do you think the basic Shopify plan has got us covered for this, or should I check out a vendor consignment app? Or maybe I should consider a separate barcode generator? Thanks for your help! 🙏❤️

lalisimone
Excursionist
12 0 12

Hi @TeenVinij,

 

I went through the same process as you. There are few options on the market that are modern, affordable, and integrate with Shopify.

 

I also tried Ricochet which is a great tool if you want to operate outside of Shopify. I needed a POS that I could use at popups. Ricochet does not. Also, Ricochet does offer an ecommerce option, but for me it fell short compared to Shopify.

 

For consignment, I use Vendor Consignment. It does not generate invoices. It can generate notifications to vendors when their items sell or have received a payout. It also does not generate SKUs or barcodes nor does it adjust pricing. What I mean by that is that where in a tool like Liberty where you can set a schedule for when a price will be automatically discounted and eventually expire, Vendor Consignment does not do that. If this is not your use case, then Vendor Consignment is a decent option.

 

If you discount an item in Shopify, Vendor Consignment captures the discount and calculates the consignment split based on the price after discount.

 

To generate barcodes and SKUs I use the app Multi-Label Barcodes. I've used it for a long time and am happy with it. 

 

Best of luck!

TeenVinij
Tourist
3 0 2

Thank you. Ricochet is very expensive $1,200 yearly pay 😨  add on they need to add on Shopify which will cost an extra. have you try Square POS with Rose for Square App ? I might to do as for couple years, idk. see what like what sell more in-store or online. 

 

Good luck to you too. ♥️

DebSumCA
Shopify Partner
3 0 5

Hello! Are you still using Vendor Consignment? I'm thinking of switching (currently using ConsignCloud) currently CC will alert me when products expire. It does not discount them and I have to do that manually. I really want product expiry and bulk markdown capabilities! How do you handle expiry/markdowns? 

KiriSchumacher
Shopify Partner
13 0 13
Hi there, all the best with it. Expiry dates aren’t an issue for my business so I’ve never needed to consider it.
lalisimone
Excursionist
12 0 12

Hi @DebSumCA I am still using Vendor Consignment. However, it does not have the functionality that you are looking for to auto discount or expire products.

 

In the past, my scenario was similar to yours. But for various reasons, I stopped discounting. However, I do use an app called Matrixify. It's a powerful tool for creating or updating product data and reporting. It's functionality, coupled with an app like Vendor Consignment, might help you cobble together a solution that meets your needs. They offer a trial of the app. It could be worth validating with them if they can create the scenario below.

 

In the past this was my use case: I discounted consignment by 15% after 30 days. Then an additional 10% after 45 days. Unsold consignment remained discounted at a total of 25% from day 45 through day 90, when the term expired. To be clear, in the Shopify universe, an expired product switches from Active to Archived so that it can no longer be transacted. I mention this because, if you try out Matrixify, this is a step that would need to be automated to make a product expired.

 

I hope this helps.

Judith (@lalisimone)

athenabandit
Tourist
6 0 3

This seems to be an answer to my question of how to keep track of inventory and payment for consignment orders. But why does the "transaction" have to happen on the Shopify POS app? 

lalisimone
Excursionist
12 0 12

Transacting the order through the POS app helps be track in my Shopify dashboard the sales that are happening at other stores. I can view sales trends, compare product performance between locations, etc. 

 

Really important to note - the systems that the other stores use are not connected to my Shopify. From the various locations where I am a vendor/consignee, I am given access to a dashboard where I see my sales. I check everyday and then run those sales through my Shopify POS to update inventory in my database. This is also useful for me to ensure that my sales report aligns with the consigners sales report at the end of each month.

 

Judith (LaliSimone)

athenabandit
Tourist
6 0 3

So then after you receive a payment for a consignment order, do you then go back and create another transfer from that store back to you?

lalisimone
Excursionist
12 0 12

Hi @athenabandit,

 

My use case is interesting in that I am both a consignee/vendor (I take product to other stores) and I am also a consigner - people bring me their products to consign.

 

For my products that I sell at other stores I run through my POS system as I mentioned. Then I get paid at a set schedule from each store. 

 

For my consignees, I transact orders in the Shopify POS app. On the backend I use Vendor Consignment to track consignment sales. That app also provides a dashboard to my consignees and notifies them when one of their items has sold or when they receive a payout. I pay them on a set schedule as well. 

 

Does this help? I'm not sure if my use case is similar to yours.

 

Judith (LaliSimone)

athenabandit
Tourist
6 0 3
Thank you so much Judith for replying to me. I've spent hours just
explaining things to Shopify reps and they still dont understand how to
help.
I sell jewelry online in my own shop but I also have several Consignment
shops that sell my jewelry. I need a way to keep track of the inventory
that is out there and also th emoney that I receive form each stores.
Draft orders was a disaster. Sometimes I go in and replace all the
inventory a store has with new things so my corner of their shop doesn't
look stale.
Having to read all the products I returned from a draft order is so
confusing.
Your way seems to work well, I was wondering why I had to go through the
app? I can create a sale for that store location on my computer, correct?
I also noticed that when i create a sale at a particular store location it
does not immediately take it out of their inventory. Ihad to adjust
manually. Maybe I did something wrong there.

Do you think the way you outlined would be the best for my situation?

THank you SO much for your time and help!
Athena

lalisimone
Excursionist
12 0 12

Hi @athenabandit ,

 

Thanks for that clarification. So when I run each sale through Shopify POS, I have to enter a payment method to complete the transaction. Needless to say, I'm not actually receiving money at that moment. I get the lump sum payout later. When I receive my end-of-month sales report from a store, I reconcile their report against my report to make sure that the payment amount and inventory sold align. Disclaimer: I am reseller and so my inventory is usually 1 of 1. But technically that doesn't matter. If things are set up and managed properly, then the steps I outlined above should work.

 

Just to add, in the settings of the POS app, I create a custom payment and name it after the store. When it's time to select a payment, I choose the corresponding payment type to complete the transaction.

 

If this method is not updating the inventory in your Shopify, then I recommend that you go to the product's page and ensure that the "Track Inventory" box is checked. If that box is checked, the inventory count should decrease by the number of orders for that product.

 

Question for you. In your Shopify, have you set up locations for every store where you sell your jewelry? If yes, is the inventory that you sell at each location also assigned to that location in your Shopify?

 

Judith (LaliSimone)