A consignment vendor contract is a formal agreement made between a buying organization and a selling entity to supply goods or services on the basis of consignment. This kind of contract enables the buying organization to ascertain proper credit terms, payment details and returns processing from the beginning. It also serves as an assurance that the receiving organization will be given complete control over vendor’s items and will retain legal ownership until they are returned in satisfactory condition by the client. The main objective of this type of agreement is to streamline operations between the two parties and ensure successful completion of a consignment transaction.