Tracking Inventory of sub assemblies

Hello all,

We are a manufacturing company for IP intercoms and speakers. Each product requires multiple child BOMs/sub-assemblies. The sub-assemblies are separately made and accounted for in inventory.

When I create a PO and I have a sub-assembly item in stock I would like ERP to pull from the sub-assembly inventory instead of listing items required for said sub-assembly. For example, one sub-assembly is our 3" extrusion that is cut from an 8’ metal extrusion with a operation cost. I currently have 90 of the 3" extrusion in stock and 28 of the 8’ metal extrusions in stock. Since there are plenty of 3" extrusion pieces in stock the PO should list under the Required Items, instead it lists the 8’ metal extrusion.

I know PO populate RAW MATERIALS from the BOM, but shouldn’t it also populate Sub Assemblies if stock is maintained? We manufacture half of a product and keep stock of that sub-assembly, so when a PO is created it should only populate that sub-assembly and the other half of the required Raw Materials to complete that product. How can I make this compatible with ERP?

I will stick to definitions since my experience does not count!

A Production Order creates a new Item rather than pulls from inventory.

https://erpnext.org/docs/user/manual/en/manufacturing/production-order
https://erpnext.com/docs/user/manual/en/manufacturing/work-order
https://erpnext.com/docs/user/manual/en/manufacturing/production-plan

OTOH Sales Order does pull from inventory, via Material Request then Stock Entry (transfer)

https://erpnext.org/docs/user/manual/en/selling/sales-order

https://erpnext.org/docs/user/manual/en/stock/material-request

Thank you, @clarkej for your input!

Production Orders pull raw materials from inventory to create a new Item which is where I am having an issue. The Production Order does not take into account how many sub-assemblies/child BOMs are in stock in order to create the parent BOM. If we have enough sub-assemblies in stock the Production Order should skip the stocked child BOM and list the rest of the required items needed. Creating a Material Request only adds a step before having to create a Production Order.

Thanks for restating Alissa.

‘Creating a Material Request only adds a step before having to create a Production Order’

My thought here is indeed, the MR step that precedes the PO, functions precisely to do what you take issue with - what you propose for the PO must do itself?

This diagram helps me with the roles responsibilities and definition steps

I understand MR are used to help which function is required for the next step. However, the manual explains MR are not mandatory.

From my knowledge the Production Order would be used when I need to manufacture an item and “all the required items (raw materials) will be fetched from BOM and populated in this table,” with the Use-Mulit Level BOM checked it will also populate the required items in its child BOMs. Here is where I would think the Production Order should check the inventory for completed sub-assemblies as child BOMs, and if there are some in stock it should list the sub-assembly as the required item and not its components. If the PO is only checking for Raw Materials I can see how the sub-assembly item does not get populated (its original Item Group was Sub Assemblies), but when I change the Item Group to Raw Material it still populates the items from the BOM and not the sub-assembly item.

If there is another way to go about this, please inform.@rmehta

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