Gartner Research

When to Say 'Yes' to Consignment Stock, When to Say 'No' and How to Link to VMI to Balance Benefits

Published: 06 October 2017

ID: G00327922

Analyst(s): Simon Bailey

Summary

Customers eager to reduce working capital may ask suppliers to delay transfer of ownership until the point of use or onward sale. Supply chain leaders focused on customer service must carefully consider the cost and risks, as well as potential benefits, especially in "as a service" business models.

Table Of Contents
  • Key Challenges

Introduction

Analysis

  • Offer Consignment Stock Only to Key Partners and Only When It Will Increase Total Value; Combine It With VMI
  • Ensure You Have a Strong Framework for the Collaboration Effort
    • Brewer and Key Retail Partner Benefit From Consignment Stock With VMI
  • Support Your Business's "as a Service" Model by Offering Consignment Stock as a Complementary Supply Chain Capability

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