Consignment Agreement Template for the Philippines

Consider using a Consignment Agreement when you want to sell products through another business without losing ownership of your inventory. This setup works perfectly for Filipino artisans, craftspeople, and small manufacturers who want to display their goods in established retail stores but can't afford wholesale arrangements.

The agreement makes sense when testing new markets or launching seasonal products in the Philippines. It protects both parties - sellers maintain control of their goods while stores minimize inventory risk. It's especially valuable for high-value items like jewelry, artwork, or designer clothing where outright purchase would be too costly for retailers.

• Consignment Store Contract: Basic retail agreement for displaying and selling products in physical stores, with standard commission structures
• Consignment Inventory Agreement: Focuses on inventory management details, tracking systems, and stock rotation policies
• Consignment Manufacturing Agreement: For raw materials supplied to manufacturers, including production quotas and quality controls
• Equipment Consignment Agreement: Specialized for heavy equipment or machinery, with maintenance and liability provisions
• Consignment Inventory Form: Simplified document for tracking individual shipments and periodic inventory updates

• Consignors (Product Owners): Small business owners, artisans, manufacturers, or suppliers who want to sell their products through established retail channels without losing ownership
• Consignees (Retailers): Shop owners, department stores, or boutiques that display and sell consigned items while earning commission
• Legal Counsel: Lawyers who draft and review agreements to ensure compliance with Philippine commercial laws and protect both parties' interests
• Store Managers: Oversee daily operations, maintain inventory records, and handle sales reporting for consigned items
• Accountants: Track sales, commissions, and tax obligations for both consignor and consignee under BIR regulations

• Basic Details: Gather complete business information for both consignor and consignee, including tax identification numbers and business permits
• Product Information: List items for consignment with detailed descriptions, quantities, and agreed selling prices
• Commission Structure: Define commission rates, payment schedules, and handling of sales tax under Philippine regulations
• Operational Terms: Specify delivery schedules, inventory reporting requirements, and handling of damaged goods
• Duration and Terms: Decide contract length, renewal options, and termination conditions
• Documentation: Prepare inventory forms, sales reports templates, and delivery receipts
• Using Our Platform: Generate a legally-sound agreement that includes all required elements for Philippine compliance

• Party Details: Complete legal names, addresses, and tax identification numbers of consignor and consignee
• Product Description: Detailed inventory list with specific items, quantities, and agreed pricing
• Commission Terms: Clear breakdown of commission rates and payment schedules under Philippine tax laws
• Risk and Insurance: Allocation of liability for loss, damage, or theft of consigned goods
• Reporting Requirements: Sales documentation, inventory tracking, and financial record-keeping obligations
• Duration and Termination: Contract period, renewal terms, and conditions for early termination
• Dispute Resolution: Jurisdiction choice and conflict resolution procedures under Philippine law

A Consignment Agreement differs significantly from an Agency Agreement in key ways, though both involve one party acting on behalf of another. While they may seem similar under Philippine commercial law, their purposes and structures serve distinct business needs.

• Ownership Structure: In consignment, the consignor retains full ownership until items are sold, while agency agreements don't typically involve product ownership
• Payment Terms: Consignment focuses on product sales and commission percentages, whereas agency agreements often involve fixed fees or variable compensation for services
• Scope of Authority: Agency agreements grant broader powers to represent the principal in various transactions, while consignment strictly limits authority to selling specific goods
• Risk Distribution: Consignment places inventory risk primarily with the consignor, but agency agreements typically share risks between principal and agent
• Legal Obligations: Agency relationships create fiduciary duties under Philippine Civil Code, while consignment focuses mainly on sales and inventory management