Finished Goods Assembly

The Finished Goods module forms part of the production functionality in DEAR Inventory. It helps you keep track of the use of raw materials as well as associated costs throughout the manufacturing process. The finished goods function can only be used with products that have a Bill of Materials with their component parts. For Disassembly of Finished Goods (including auto-disassembly), see Disassembly


Prerequisites


Table of Contents


Adding a Bill of Materials to a Product

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The assembly function can only be used for items that have a Bill of Materials showing their component parts. If you already have products with Bills of Materials, skip to Assembling a Finished Product.


NOTE: To create a product with a Bill of Materials, the component products must already be created in DEAR.


To add a Bill of Materials to an item:

  1. When creating a new product or editing an existing product, check the Bill of Materials box in the document header.


  2. This activates the Bill of Materials tab below. Use + Component to select the component products from your inventory.
  3. Enter the Quantity of each component product required in the assembly. 
  4. Enter a Wastage %/Wastage Quantity and/or Disassembly Costpercentage if required.
  5. Service items associated with the disassembly can be included by clicking + Labour and Overheads. It is required to include an Expense Account.
  6. Save the product to complete the assembly.


NOTE: When Wastage %, Wastage Quantity and/or Disassembly Cost percentage are left blank, DEAR splits the cost of the components equally between product lines.

For example, say you have Finished Product A with the following component parts: [2 x Component Product X] and [1 x Component Product Y].

If Product A has $100 cost, the default settings in DEAR will set $50 for Product X line (which will be split among 2 items, giving the cost of $25 for each instance of Product X) and $50 for Product Y.

Suppose that you wish to set your own rules. You estimate that the cost of product Y is $80 and the cost of the product X is $10 each. Your disassembly cost percentage will be 20% for the first line (product X) and 80% for the second line (product Y).



Assembling a Finished Product

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Assembly can be performed manually or automatically. Auto-assembly is only recommended if you do not sell the component parts in a finished product as individual items. If an order is placed for a finished product whose components are not in stock, the missing components will be backordered


Manual Assembly

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NOTE: If finished good components are backordered, the assembly will not automatically be completed when the components are received. The assembly must be manually authorised once the required components are back in stock. 


To manually assemble a finished product:

  1. Navigate to Production > New > Assembly.
  2. Choose a Location where the product will be manufactured.
  3. Enter either a Product Name or SKU, then select a product from the list. Only products with a Bill of Materials will be shown.
  4. Choose a Work in Progress Account and a Finished Goods Account.
  5. Enter a Quantity to assemble. Use Maximum Quantity to calculate the maximum number of assemblies that can be performed with your available inventory.
  6. Click Load BOM to add the component items to the assembly from the Bill of Materials. If needed, edit the Bill of Materials by either clicking or Adding more items  and adding additional components to the Bill of Materials. You can also change the quantity of the current components used which will ultimately affect the total quantity.
  7. Authorise the order.

    NOTE:  Total quantity figures in red indicate insufficient components that will need to be ordered to complete this manufacturing run. In case total quantity of the components is insufficient, you can still proceed with authorising the order, which will automatically create backorders for any components that are missing. As soon as all required components are in stock, you will be able to proceed with the pick stage in the manufacturing process.

  8. Go to the Pick tab, then use Auto Pick to automatically select the raw ingredients based on the costing method selected.
  9. Allocate the items to the production room physically by taking them out of the inventory.

    NOTE: If you know that the total quantity of raw components used is higher or lower than the total quantity displayed in the pick stage, you can amend that here.



  10. Once the manufacturing run is completed, click the Complete button.


NOTE: Before completing the assembly, you can still amend the actual yield of the manufacturing run if it was higher or lower than expected. Completing the finished goods task will increase the total quantity of the finished product by the actual yield.



Automatic Assembly

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Auto-assembly is triggered when a sale order for the finished good is authorised. Auto-assembly is not triggered if there is enough stock of the finished good already in your inventory to fulfill any outstanding sale orders.


Unlike for manual assembly, It is not possible to manually adjust the quantity of components and wastage for the assembly. 


If finished good components are backordered, auto-assembly is NOT triggered when component items are received. The original order must be undone and re-authorised to trigger auto-assembly. 


NOTE: Only FIFO, FIFO-Batch and Special-Batch costing methods support auto-assembly.


To assemble an item automatically:

  1. Navigate to Inventory > Products.
  2. Select the product you wish to assemble automatically.
  3. Check the Auto-assembly box.
  4. Save the product.



View Assembly List

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You can view all historical Assemblies by navigating to Production -> Assemblies

See the details of previous assemblies by clicking on each line.



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