The Consignment Agreement Form is a crucial document used in Philippine business transactions where one party (consignor) entrusts their goods to another party (consignee) for sale without transferring ownership until the final sale occurs. This arrangement is particularly common in retail, luxury goods, and specialized markets where inventory costs and risks need to be managed effectively. The agreement must comply with Philippine commercial law, including the Civil Code and Code of Commerce, and typically includes detailed provisions for inventory management, commission structures, reporting requirements, and risk allocation. It's essential for businesses looking to expand their distribution network without significant upfront inventory investments and provides flexibility in market testing new products while maintaining control over pricing and presentation.
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1. Parties: Identification of the consignor and consignee, including complete legal names, addresses, and business registration details
2. Background: Context of the agreement, brief description of the parties' businesses, and purpose of the consignment arrangement
3. Definitions: Detailed definitions of key terms used throughout the agreement
4. Appointment and Scope: Terms of appointment of the consignee and scope of the consignment arrangement
5. Delivery and Receipt of Goods: Procedures for delivery, inspection, and acceptance of consigned goods
6. Pricing and Commission Structure: Details of pricing mechanism, commission rates, and payment terms
7. Title and Risk: Clarification that title remains with consignor until sale, and allocation of risk
8. Obligations of Consignor: Responsibilities of the consignor including product quality, support, and warranties
9. Obligations of Consignee: Responsibilities of the consignee including storage, sales efforts, and reporting
10. Accounting and Reports: Requirements for inventory management, sales reporting, and financial accounting
11. Term and Termination: Duration of the agreement and circumstances for termination
12. Return of Unsold Goods: Procedures and conditions for returning unsold merchandise
13. Governing Law and Jurisdiction: Specification of Philippine law as governing law and jurisdiction for disputes
14. General Provisions: Standard clauses including notices, amendments, and severability
1. Insurance: Detailed insurance requirements when high-value goods are involved
2. Intellectual Property: Protection of trademarks and IP rights when branded products are consigned
3. Exclusivity: Terms of exclusive arrangement if consignee is granted exclusive rights in certain territories
4. Marketing and Display: Specific requirements for product display and marketing when retail presentation is crucial
5. Data Protection: Provisions for handling customer data when personal information is collected during sales
6. Force Majeure: Provisions for unforeseen circumstances affecting performance of the agreement
7. Non-Competition: Restrictions on competing activities when necessary to protect business interests
8. Bank Guarantee: Requirements for financial security when dealing with high-value consignments
1. Schedule A - Product List: Detailed list of consigned products including descriptions, SKUs, and wholesale/retail prices
2. Schedule B - Commission Structure: Detailed breakdown of commission rates, including any variations based on product categories or sales volumes
3. Schedule C - Operating Procedures: Specific procedures for ordering, delivery, storage, and handling of consigned goods
4. Schedule D - Reporting Ƶ: Standard formats for inventory reports, sales reports, and financial statements
5. Schedule E - Territory Definition: Detailed description of geographical areas covered by the agreement
6. Appendix 1 - Storage Requirements: Specific requirements for storage conditions and handling of goods
7. Appendix 2 - Return Policy: Detailed procedures for handling customer returns and damaged goods
Authors
Relevant legal definitions
Clauses
Relevant Industries
Retail
Fashion and Apparel
Consumer Electronics
Luxury Goods
Automotive Parts
Furniture and Home Decor
Jewelry and Accessories
Books and Publications
Art and Collectibles
Agricultural Products
Cosmetics and Beauty Products
Sporting Goods
Industrial Equipment
Food and Beverage
Relevant Teams
Legal
Commercial
Sales
Procurement
Finance
Operations
Supply Chain
Retail Operations
Compliance
Business Development
Contract Administration
Relevant Roles
Commercial Director
Sales Manager
Procurement Manager
Legal Counsel
Business Development Manager
Retail Operations Manager
Supply Chain Manager
Finance Manager
Inventory Control Manager
Contract Administrator
Chief Financial Officer
Chief Operating Officer
Store Manager
Distribution Manager
Compliance Officer
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