Explaining the Consignment Collaboration Scenario

I need to order another 40 cubic yards of gravel and my Supplier has agreed to send it to me on consignment. This is preferable for this project because I will need to use it over a long period of time. I can avoid multiple shipping charges by receiving it all at once and then notifying the Supplier as I use it and paying for it as I use it.

I will create a Consignment Purchase Order for the 40 cubic yards of gravel and send it to my gravel Supplier.

I received the Consignment Purchase Order for 40 cubic yards of gravel. I have agreed to send this to our Buyer on consignment and have them pay for it as they use it. I will send an Order Confirmation to confirm receipt of the Consignment Purchase Order.

My trucks only hold a maximum of 20 cubic yards of gravel, so I will prepare two separate Advance Ship Notices--each one for 20 cubic yards.

I will send two truckloads of gravel to the Buyer. The Buyer's consignment stock is increased.

I received both shipments of gravel from my Supplier. I will send a Goods Receipt for each shipment.

We used 20 cubic yards of gravel this week so I will move that amount from consignment stock to my own stock and issue a Transfer Posting.

We agreed with the Supplier that we would create the Settlement Invoice based on the stock movement.

We used another 20 cubic yards of gravel this week so I will move that amount from consignment stock to my own stock and issue a Transfer Posting.

As part of our agreement with the Supplier, we create another Settlement Invoice based on the most recent stock movement.