If you own or operate a small business, you might be familiar with these two words. They often deal with the transfer of merchandise from one business to another, or from an individual to a business.
What makes them confusing is that they both deal with the same event, but from different sides. That’s right, consignor and consignee deal with either side of a transaction, so it’s easy to get one mixed up with the other.
What’s the Difference Between Consignor and Consignee?
In this post, I want to outline the differences between these two words. I will discuss their definitions and their functions within a sentence. Then, at the end, I will give you an easy trick to remember the difference between them.
After reading this post, you shouldn’t ever again wonder, “Am I the consignor or consignee?”
What is Consignment?
Before we talk about consignor vs. consignee, we should figure out what consignment is.
Consignment is the act of consigning, which is to send something to a person or a place to be sold. Here is a typical example of something that is consigned.
Imagine an art collector has a painting. He gives this painting on consignment to a gallery, i.e., he consigns it to them. He still maintains legal ownership of the painting, but he gives custody to the gallery until they sell it. Once the painting is sold, the art collector and the gallery split the revenue from the sale.
This process is called consignment. Now, who is the consignor and who is the consignee in this transaction?
When to Use Consignor
A consignor (sometimes spelled consigner) is the person who is giving over the merchandise. In our above example, the art collector would be the consignor. Here are a few more examples of consignor in a sentence.
- The consignor backed out of the deal, so the sale didn’t process.
- Until the merchandise is sold, the consignor maintains legal ownership.
- Although the consignor was anonymous, the gem was previously held by Sir James Duke and Arthur Johnson Jr.
When to Use Consignee
A consignee is the person (or place) to whom something is cosigned. In our above example, the gallery that is tasked with the job to sell the painting is the consignee. Here are a few more examples of consignee in a sentence.
- We get 45 percent of the sales price; the consignee gets 55 percent when items are sold. –Philadelphia Daily News
- The containers weren’t claimed by the consignee and were left to the disposal of authorities in the United Arab Emirates. –The Wall Street Journal
- If the consignee agrees to the offer, we can proceed with the sale.
Trick to Remember the Difference
Is it consignee or consignor? Still not sure you’ll be able to remember? No worries
Here is a helpful trick that I use whenever I forget which is which.
The consignor is the person who actually owns the property to be sold. They give it over to the consignee, but the consignor actually owns it. Therefore, you can think of the consignor as the owner of the goods, and since consignor has an extra “O” in it, it’s easy to make this connection.
The consignee is the person (or place) that is doing the selling. Think of the consignee as the seller. This connection is also easy to make since consignee ends in two “E’s” and seller also has two “E’s” in it.
The two words consignee vs. consignor deal with people on opposite sides of the same transaction.
The consignor is the person handing over property to be sold.
The consignee is the person receiving the property that is to be sold.