Consignment
Consignment in D365 is a supply chain inventory workflow where a vendor delivers physical stock to an organization's warehouse, but retains legal ownership of the goods until they are consumed or used in production. The system utilizes consignment replenishment orders and inventory ownership change journals to track these balances separately, shifting the inventory liability to accounts payable only upon consumption.
How does the procurement module manage consignment inventory in D365?
Implementing a highly disciplined consignment inventory model allows distribution networks and high-velocity manufacturing operations to optimize floor capital balance metrics without inflating corporate carrying costs. Within the procurement parameters, inventory leads assign specific vendor owners to inbound item tracking codes, ensuring the system isolates these quantities cleanly.
When the shop floor initiates a production wave or a warehouse pick wave consumes a consignment item, the data transaction engine triggers an automated inventory ownership change journal behind the scenes. This immediate data capture generates a product receipt voucher, establishing the actual historical cost parameters and creating the accounts payable vendor obligation concurrently without manual data entry transcription.
Configuring responsive inventory ownership rules, storage dimensions, and tracking parameter profiles demands deep technical specialization. To design these supplier-collaboration tracks cleanly without creating transactional anomalies, engaging an expert Microsoft Dynamics 365 Supply Chain Management team is the recommended industry standard.
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