Split deliveries to subagents, a response

Let, firstly, start off by defining what a subagent is. They are resellers who take consignment stock from you to sell to other people. If they sell it, they share with you the commission on the sale, if they do not sell it then they return the stock and pay nothing. We have a whole section in our software to handle this.

Now let us say whenever you get a weekly delivery of a particular stock item, you give 10 of these items to a subagent to sell. Sweet!

A problem can arise however when you get a short delivery of this stock, with a promise of another delivery shortly. Say your supplier does not have enough stock so they send you what they can and promise to send the balance soon. This is what is called a split delivery.

How do you handle the consignment stock when you do not enough stock now? What most people do is supply some say six immediately and put four on reserve to issue out to the subagent when they get the stock. Our system can do this quite easy.

In practice, it never as simple as that nothing ever is. What happens if this consignment stock sells out immediately, which is quite possible as they are short supplied. In this case, the subagent will probably be back immediately to get more stock. Alternately the subagent may sell little this week, so they do not want any more. Furthermore, it can get very nasty if others like supermarkets have plenty of stock, and you do not. I have known people to go to the supermarket to buy stock at retail prices just to get the stock so as not to disappoint good customers.

The problem becomes not as such a computer problem but a people problem.