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Suggestions / Thoughts Note that I am just speculating here ... not something we have actually done* Make the Distributor a special warehouse in BPCS that represents the inventory that you sent them on consignment, even though the warehouse may be under the distributor control and not under your company's control. Use INV510 transaction to move the inventory, instead of using ORD590 ** You would need to have the warehouse coded so any inventory there is not usable by MRP ** You would need to have some report (could be Query/400) listing all inventory completed by the Plant and shipped to this Distributor warehouse ** When the Distributor informs you they have sold what was on consignment, then use ORD590 to book the sale ... you may need to check customer order types ... what stuff you want to update - inventory, receivables, sales, general ledger, etc. ** make sure the warehouse # is at the end of the range of warehouses within the facility for ease of physical inventory, so it is easy to exclude that one when doing the others ** make sure the Distributor knows your fiscal calendar, because if a physical inventory of the Distributor's consignment inventory is desirable occasionally, it needs to be done concurrent with your BPCS end month fiscal
* Make the inventory that you send the Distributor in a different facility, which gets there via resupply order. This would mean that everything in that facility could be itemized differently in your General Ledger, suing a Profit Center connected to the facility identification ** This also makes it easier to keep all sorts of accounting totals separate for just what the Distributor has ** Then when you hear from the Distributor that they sold it to their Wholesalers/Retailers, then you actually process the billing ** You could periodically run some inventory reports on what is in that warehouse to match with requests to the Distributor to conduct cycle counts ** This would have added benefit that through BPCS Security you can prevent people from having access to that inventory to do the kinds of transactions authorized for your production facilities ** In 405 CD by facility, you can set safety stock other than what is overall item corporate or at another facility, so that when the inventory allegedly at the Distributor falls below the safety stock, DRP can "automatically" generate resupply order demand upon your Plant
* Look into how BPCS can track Outside Operations, which might have applicability here ** This is where something you are manufacturing goes to some other company for some special work that they can do more economically than you. Perhaps they have a machine that you do not have the volume to justify having yourself. Perhaps what they do is very different than most of what your company does. ** In your particular case, you would want the Outside Operation to be the Last Operation, which might be labeled as "Sit in Distributor Warehouse"
** I think it can be difficult to get at counts of what is supposed to be there*** We do have some outside operations ... we run a report of open shop orders involved, add quantity done at the operation that sends the work to the outside operation, subtract quantity done at the operation where they send the work back to us, and this gives them WIP supposedly there, but we are not able to get at any scrap they had ... we also run a report of what inventory was issued / received associated with the parts coded for outside operation (an item class) multiplied by the cost bucket for their involvement ** When the Distributor notifies you that they have sold some volume of what they calling "Consignment Inventory" then you post JIT600 transaction to record completion of last step, followed by ORD590 to generate billing transactions
* Whatever you do, will probably need some kind of ISO procedure to record step by step what people supposed to do, to avoid having mixups where BPCS thinks the inventory some place other than where it really is in the process.
* You might want to consult with your auditors whether either of these approaches are satisfactory
Everyone's Pal Al
Dear All,We are on Version 4.05CD and looking for change in our existing sales model. Currently we record all dispatch from Plant to Distributor as sales. In future, we want to record dispatch from Plant to distributor as "Consignment Inventory owned by us " at distributor warehouse instead of recording sales. When Distributor will send us detail of sales made to wholesalers/retailers out of consignment inventory send to them, we will record that as our sales in GLD. We will always maintain a minimum safety stock at distributor warehouse and want to track detail of consignment inventory in BPCS.Can anyone please advise/suggest us how best we can accommodate this in BPCS. Cheers Abdul Haque
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