What is inventory consignment?

Inventory consignment is an arrangement in which inventory is left in the possession of another party to sell.

In our case, the investor contributes funds to enable the purchase of inventory that will be sold by the Amazon seller. From the time the investment is made to purchase the inventory until the product is sold, the product legally belongs to the consignor. In this case, the Amazon seller is the consignee (the one who is selling the inventory on the investor’s behalf) and the investor is the consignor (the one who legally owns the inventory until it’s sold).