A consignor is the party that owns goods and places them with another business, the consignee, to be sold on the consignor's behalf under a consignment arrangement. Despite handing the physical items over to the consignee, the consignor keeps legal ownership of the goods the entire time they sit unsold, and only recognizes a sale and the related revenue once the consignee actually sells the item to an end customer and reports the transaction back.
The consignor's role and risk
Because the consignor retains ownership throughout, it also keeps bearing the risk that the goods never sell, become damaged, or go out of fashion while sitting at the consignee's location; the consignee generally bears none of that inventory risk, since it never paid for the goods in the first place. This is precisely why a consignor keeps consigned goods on its own balance sheet as inventory rather than removing them once they are shipped out, and why a consignor's physical inventory count at year end must include goods sitting at every consignee location, not just its own warehouse.
How the consignor is paid
When a sale finally happens, the consignee remits the agreed portion of the sale proceeds to the consignor, keeping a commission as its own fee for the service of selling, and the consignor records revenue at that point, not when the goods were first shipped to the consignee. A consignor working with several consignees across different locations has to track consigned inventory by location to know exactly what remains unsold and where, which is more administratively demanding than selling through an ordinary wholesale channel where title and risk pass immediately at the point of sale to the retailer.