What characterizes Consignment Inventory?

Consignment inventory is characterized by the arrangement wherein the supplier retains ownership of the inventory until it is actually used or sold by the buyer. In this setup, the goods are stored at the buyer's location, allowing the buyer to utilize or sell the products without having to purchase them outright first. This arrangement can be beneficial for both parties; the supplier maintains control over the inventory, while the buyer can access the products without immediate financial expenditure.

In contrast, the other options do not accurately describe consignment inventory. The first option suggests that the buyer owns the inventory while it is held at the supplier's location, which does not align with the principles of consignment. The third option discusses inventory in a public warehouse, which is a different context altogether, involving third-party storage. Finally, the fourth option refers to outdated or unusable stock, which is a distinct category and not relevant to the concept of consignment inventory.