Inventory Management
Overhead Configuration
Keep consumables, packaging and other overheads out of your cost of sales, while still being able to order them.
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About
Inventory Management lets you handle overhead products flexibly. You can keep them out of cost of sales and period results, or take them out of inventory completely while still being able to buy them.
Two types of overhead
Tracked in inventory and counted, but left out of cost of sales. For example, consumables and packaging.
Not tracked in inventory at all, only ordered. For example, stationery and cleaning materials.
Set up the product group first
Both types must be in a product group set up for overhead purchasing.
Ready to start?
Go to the Set Up Overheads tab.
Set Up Overheads
Set up a product as an inventory or non-inventory overhead.
Product group first
Whichever type you choose, the product's group must be set up for overhead purchasing.
Which type of overhead?
Inventory overhead
Inventory overheads are part of inventory, but they're left out of cost of sales in your final stock period results. You can use them in all of these without affecting stock performance:
- Supplier Orders
- Cash Purchases
- Stock Transfers
- Wastage
- Line Checks
- Stock Period Counts
They still need counting
Inventory overheads still create stock movements, so you're expected to count any that have moved. The counts just aren't included in period performance reports.
Setting one up
1
Make sure the product's group is set up for overhead purchasing.
2
Set up the product as a supplied product as normal, in that product group.
The product is tracked in inventory, but left out of cost of sales.
Non-inventory overhead
Non-inventory overheads are products you don't need in inventory but still want to order through supplier orders. They're left out of everything else, so you can only use them in:
- Supplier Orders
No counting needed
Non-inventory overheads don't create stock movements, so they don't need counting and don't affect period performance reports.
Setting one up
1
Make sure the product's group is set up for overhead purchasing.
2
Set up the product as a non-inventory product as normal, with Stock Type set to Other, in that product group.
The product can be ordered from suppliers, but isn't tracked in inventory.
Product Group Setup
Both types of overhead need their product group linked to an overhead account.
Steps
1
In the chart of accounts, create an Overhead type account. Find out how to create an account.
2
In the product group's setup page, choose that account as the Purchasing Account. Find out how to set up a product group.
Any product in that group is now treated as an overhead. Next, set up the overhead products.