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Consignment stock from Vendors

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Posted on by MS-03120953-0

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Hi,

Please advise on the best way to process consignment stock from vendors in BC. Only consignment stock is sold, a vendor must be invoiced.

How do we setup tracking the consignment stock in BC. When a vendor send us consignment stock, we dont want our inventory account in G/L to be hit

Also how do we transfer consignment stock from our warehouse to another location

Many thanks

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Microsoft Dynamics NAV

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Arpitkumar shah 14 on at

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HI,

Such functionalities are not available in the standard business central.

if you want to manage the consignments in the system then minor customization will be required to create the consignment card and then whatever material sold for that only system can raise a purchase order against which you can manage the GRN and Invoice for the vendor and sales invoice for the customer.

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Teagen Boll 1,436 Super User 2026 Season 1 on at

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Business Central has a lesser known setting that I use for consignment stock. There is no customization needed unless you want to look at a more specific process.

On the Item card you can add a field called "Inventory value zero":

If you enable that then you won't have any inventory balance sheet entries for this stock but you can still track the quantities.

To transfer that consignment stock it would just be treated like any other inventory in BC. There just aren't inventory values tracked in the balance sheet. You can transfer it, sell it, buy it etc.

Let me know if that helps!

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Valentin Castravet 32,208 Super User 2026 Season 1 on at

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This is the best blog post on consignment inventory in the system - Consignment Inventory | Olof Simren - Microsoft Dynamics NAV & 365 Business Central Blog

It should answer all your questions and give you ideas how you can handle it.

Valentin Castravet
Work: Zander ERP Services
Blog: Dynamics 365 Business Central Insights
LinkedIn: www.linkedin.com/in/valentin-c-0500a247/

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OussamaSabbouh 12,965 Super User 2026 Season 1 on at

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Hello,

Best practice for consignment in Business Central is to use a separate consignment location and dedicated posting setup, so you can track quantities without hitting your normal inventory asset account. When the vendor delivers consignment stock, receive it into a dedicated Consignment Location and configure the Inventory Posting Setup for that location (or posting group) to point to a clearing/liability account instead of your regular inventory G/L, so your main inventory asset isn’t impacted. When you sell the goods, process the sale (typically via Sales Order if warehouse is involved), then post the vendor invoice only for the quantities sold. If you need to move consignment stock between warehouses, use standard Transfer Orders between locations. There’s no built-in “consignment flag” in standard BC, so it’s controlled through location structure and posting setup; for stricter financial automation, a small customization is often added.

Regards,
Oussama Sabbouh

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Dhiren Nagar 2,898 Super User 2026 Season 1 on at

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Hi,

If you are not using expected cost posting then you can achieve this by creating normal Purchase Order or Blanket Purchase Order. Whereby when you receive inventory from your Vendor, you create an PO and Receive it. It shall create an Inventory in your Location. You can create a separate Inventory posting group for those Item to check it or you can create a separate Bin to understand what inventory belongs to Vendor.

Now when you Sales it, you can book Purchase Invoice along with it or at month end. This will hit your inventory.

If you are using expected cost posting it is better to create separate Inventory and Gen. Prod. Posting group in which you can configure it to not post into your inventory ledger but a different general ledger for e.g. Vendor Inventory Balance.

✅ Tick the checkbox below to mark the answer as verified, if it helped resolve your question.

Regards,

Dhiren.

LinkedIn - https://www.linkedin.com/in/ca-dhiren-nagar-5079081b2/

Blog - https://dhirennagar.blogspot.com/

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YUN ZHU 99,086 Super User 2026 Season 1 on at

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I think it depends on whether this inventory still belongs to you. If it does, use a transfer order to move it to the customer's dedicated location for easier inventory checks. You can issue a prepayment invoice to the customer. If this inventory doesn't belong to you, it should be posted as an outbound item and managed outside the system.

Hope this helps.

Thanks.

ZHU

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