Consignment and Sale

Consignment:

• Parties: Consignor and consignee
• Ownership of a goods: In consignment, there is no transfer of ownership in the goods from consignor to consignee. The consignor remains the owner of goods till they are actually sold by the consignee.
• Mutual relation between Parties: Is that of principal and agent.
• Expenses after despatching the goods: Are to be borne by the consignor.
• Risk: Remains with the consignor.
• Return of goods:  Is possible if goods are not sold by consignor.
• Proforma Invoice:  Consignor prepares only a proforma invoice.
• Profit/Loss: Consignee is not in any way connected with Profit loss on sale.

Sales:

• Parties: Seller and buyer.
• Ownership of a goods: In the case of sale, ownership in the goods is immediately transferred from the seller to the buyer.
• Mutual relation between Parties: Is that of debtor and creditors.
• Expenses after dispatching the goods: Are borne by the buyer.
• Risk: Passes to the buyer.
• Return of goods:  Is not possible as goods once sold are not return able.
• Proforma Invoice:  Seller prepares a sales invoice.
• Profit/Loss: After the sale is complete, the profit/loss belongs to buyer.