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Manufacturing Questions

Hi,

I’m a little new to the manufacturing module, and I’m trying to figure out how to apply our process to ERPNext. I’m hoping that one of you can give me tips or suggestions on how to handle it.

We manufacture items that (may) be shared with other customers. E.g., one person may purchase 1 of 2 faces. There are also two edges that may be purchased, although we do not are not supposed to sell them.

We develop the sides FIFO, and there is no inventory to track in this process (we’re just developing artwork). However, we outsource the whole item in batches for manufacturing by another company, and that does require tracking inventory. Batched manufacturing occurs every four weeks, and the manufacturer ships either to us for distribution or distributes it directly on our behalf.

If that wasn’t enough of a challenge to implement, the item is not shipped to the customer; instead we purchase space from a location and ship a quantity of the item to the location based on the location’s capacity.


I can see how to manufacture the faces in ERPNext - create a new item, place it on a PO, and create a BOM off of that.

However, at that point I’m stuck; how do I track the manufacturing of the actual item, especially when I don’t know at the time of purchase if someone else will buy the other face?

Finally, how do I track the shipment of the item?

Help is appreciated!

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It sounds like you are essentially sending specifications to the manufacturer, so once the design of the item is complete, the BOM is created and fed to a Material Request a PO made from that and sent to your manufacturer . The manufacturer either drop ships the finished item to the warehouse (location) specified in the PO or directly to the customer.

Tracking the item shipment requires notification of shipment by the manufacturer and whatever tracking service the transporter provides.

Once the Item is received, a Purchase Receipt can be completed with relevant warehouse stock levels .

The manufacturing documentation may also be consulted to see how ERPNext can be used were you to actually manufacture the item, though it doesn’t seem to be the case here .

That makes sense as long as we’re shipping the item to the customer that ordered it. We aren’t.

Looking over drop shipping on ERPNext yields https://docs.erpnext.com/docs/user/manual/en/selling/articles/drop-shipping, but that tells me that drop shipping is managed on the sales order. My problem is that I’m not shipping what we create to the customer. Instead we use it to assemble a different item, which we then ship somewhere else entirely. To complicate matters further, we are paying the location to take the items, so a sales order doesn’t seem appropriate for the items that we ship.

Create a shipping address for the location that will store the Item until it is shipped to the customer.

Issue a PO to the the supplier who manufactures the Item for you with the shipping address of the location ( warehouse if you like).

Use a stock entry if it suits you.

When an order is received for the Item, create a Sales Order referencing the source warehouse (location)

If necessary issue a PO to the warehouse operator and or transporter for shipping.

If the Item is partly manufactured in house and partly by suppliers and returned to you for finishing them the shipping address on the PO to the supplier is that one of your possibly many shipping addresses.

This may be useful: https://docs.erpnext.com/docs/user/manual/en/manufacturing/subcontracting

I think I see now - I didn’t see the significance of setting the target warehouse on a PO. We can either create a separate warehouse for each location, or we can create a manufacturer warehouse and distribute from there using a stock entry.

We do need a step to prepare the faces for the manufacturer, so would something like this work for a process?

  1. Generate unfinished face + finished face items without inventory tracking
  2. Add the finished face item to the SO
  3. Run through the BOM/Work Order/Job process to generate the finished face item

Then, when we’re ready to manufacture the physical items:

  1. Create an item, without inventory tracking, that combines the finished face items necessary for manufacturing
  2. Create the finished item, with inventory tracking, that the manufacturer will create
  3. Create a BOM for the finished item
  4. Create a PO for the finished items
  5. Transfer the item from step 1 to the manufacturer
  6. Receive the items at the appropriate warehouse and/or distribute them using a stock entry.

Does that sound workable?

I think so. The docs for subcontracting describe the sub items used to create a BOM , but the example isn’t quite as clear as it maybe could be. In any case the BOM is key.

Try a few test runs and see how it flows - good luck!

Thanks! I’ll give it a go!