Simple Consignment Agreement Template for England and Wales

A Simple Consignment Agreement is a crucial commercial contract that allows you to place your goods with another business for sale while retaining ownership until the final transaction occurs. Under England and Wales law, this arrangement is governed by comprehensive legislation including the Sale of Goods Act 1979, which defines your rights and obligations as either the consignor or consignee in the relationship.

When do you need this document?

You need a Simple Consignment Agreement when you want to expand your sales channels without the financial risk of wholesale arrangements. This document is essential if you're a manufacturer or supplier looking to place products in retail outlets, galleries, or other sales venues while maintaining control over pricing and inventory. It's particularly valuable for seasonal businesses, artisans selling through craft shops, or technology companies distributing through reseller networks. The agreement protects both parties by clearly defining responsibilities for storage, display, insurance, and payment processing while ensuring compliance with UK consumer protection laws.

Key legal considerations

Your consignment agreement must clearly address title and risk allocation, as goods remain your property until sold under English law. The commission structure requires precise definition to avoid disputes, including calculation methods, payment timing, and any deductions for expenses. You must specify reporting obligations, inventory management procedures, and conditions for returning unsold goods. The agreement should include termination clauses that protect both parties' interests and define procedures for final accounting. Insurance provisions are crucial, as the consignee typically assumes responsibility for goods in their possession. Consider including exclusivity clauses, territorial restrictions, and minimum performance standards to protect your commercial interests.

Legal requirements in England and Wales

Under the Sale of Goods Act 1979, your agreement must clearly distinguish between sale and consignment arrangements to avoid unintended ownership transfers. The Consumer Rights Act 2015 may apply if end customers are consumers, requiring specific warranty and return provisions. Commercial Agents Regulations 1993 could be relevant if the consignee acts as your commercial agent rather than a simple consignee. Your agreement must comply with agency law principles, particularly regarding the consignee's authority and fiduciary duties. The Supply of Goods and Services Act 1982 governs quality standards and service provisions within the relationship. Ensure your agreement includes proper dispute resolution mechanisms and governing law clauses to maintain enforceability under English jurisdiction.