You need to know if he is Renting shelf space or Getting a commission. If the item is stocked and he has to pay the person per sale, he isn't Renting the space; he's taking a commission. If he collects rent on some routine basis, then he is Renting the space.

He could be doing both, of course.

"These sales will ultimately be given to the owner of the products"

Gross or Net? What about sales taxes? Whose credit card terminal is in use? What about stock that doesn't sell; or, "shrinkage?" Damage?

"and my client will only keep a small amount for the rental of the shelving space."

Again, is that payment per sale (which smells like commission)?

"I have read this may be called slotting"

Slotting is when a retailer charges a manufacturer or distributor for shelf space, because the manufacturer or distributor wants the product to be carried and in a better location in the store.

"however, do I issue a 1099 to the vendor for sales ?"

It matters who owns the product while it is on the floor; who is liable if there is theft or a fire, for instance?

"How will I report these sales on my clients schedule C?"

One thing to do is to contact the sales tax agency to discuss how they need this handled in your client's area.

"They will be sales on his balance sheet"

You mean Liability?

"however, he did not purchase product nor did he keep profits. I was considering 1099 MISC as other income ??"

You seem to believe it will be:

All funds collected are Liability. The Gross would be paid to the person offering the items in the shop. That person has gross sales and sales tax responsibility. Then this person pays Rent. Your client is renting to a tenant. And your client needs proper legal guidance, insurance, and likely is not supposed to use their credit card terminal for this.

I would point out that this community can answer your questions once you get more info. For instance, do you have a CPA that handles hair salons and antique malls? That would be your consultant.