Introduction
The Inventory Management module lets you handle overhead-type products in a flexible way. You can choose to exclude them from cost-of-sale, period results, or remove them from inventory completely whilst still having them available for purchasing. This gives you control to manage operations more accurately.
There are two types of overhead products:
Inventory Overhead Products
Inventory Overhead Products are often used to represent products such as consumables and packaging.
If configured as Inventory Overhead products, the products are included as part of inventory, but are excluded from cost of sales calculations within the final stock period results This means that they can be used in the following areas without impacting on stock performance results:
- Supplier Orders
- Cash Purchases
- Stock Transfers
- Wastage
- Line Checks
- Stock Period Counts
As stock movements still get generated, a stock count is expected for products with movements. The key difference is that the counts are excluded from overall inventory period performance reporting.
To allocate a product as an Inventory Overhead, set up the product as a Supplied Product as standard but ensure that you assign the product against a product group that is flagged for overhead purchasing.
To configure a product group for overhead purchasing:
- Create an Overhead type account within the Chart Of Accounts. (For details, Click Here.)
- Select this account in the Purchasing Account list in the Product Group setup page. (For details, Click Here.)
Non-Inventory Overhead Products
Non-Inventory Overhead Products are often used to represent products that are not required as part of the Inventory module, but you'd like to order through the Supplier Orders feature. These include products such as stationery items and cleaning materials.
Non-Inventory Overhead Products are excluded from all aspects of inventory except for place orders only, and therefore can only be used in the following areas:
- Supplier Orders
As stock movements are not generated, no stock counts are expected and period performance reporting is not impacted by these products.
To allocate a product as a Non-Inventory Overhead, set up the product as a Non-Inventory Product as standard with the Stock Type setting set as "Other". You need to ensure that you assign the product against a product group that is flagged for overhead purchasing.
To configure a product group for overhead purchasing:
- Create an Overhead type account within the Chart Of Accounts. (For details, Click Here.)
- Select this account in the Purchasing Account list in the Product Group setup page. (For details, Click Here.)