Document background
The Consignment Inventory Agreement is essential for businesses operating in Pakistan who wish to establish a consignment stock arrangement where the supplier (consignor) maintains ownership of goods while they are stored at the premises of a distributor or retailer (consignee). This document is particularly relevant in sectors with high-value inventory or seasonal products, addressing key aspects such as inventory management, risk allocation, and financial arrangements. The agreement must comply with Pakistani commercial law, particularly the Contract Act 1872 and Sale of Goods Act 1930, while incorporating provisions for taxation under the Sales Tax Act 1990. It's commonly used when suppliers want to expand their market presence without requiring immediate purchase commitments from distributors, or when retailers wish to maintain inventory without significant upfront investment.
