How do I create an Inventory-Managed Product?

In order to create products with tracked inventory is start by creating a  New Product in Sales - More - Products and Services - New Product or Service. You will be offered the option to "Manage Inventories."

 

Tracked products will:

 

 

When to use a non-inventory tracked product

If you create a Sales - More - Products and Services - New Product or Service and select "NO" in the field "Track Inventory", OneUp will:

  • Not generate any inventory movements
  • Post the complete Cost of Goods sold right into your P&L the moment you create a bill or an expense for your purchased product
  • Not allow you to create a picking list
  • Not show the products in your stock on hand in Inventory - Stock
  • Not let you use any manual update of stock on hand using inventory count sheet, inventory entry or inventory withdrawal

Non-tracked products can be used to register costs you purchase (like shipping, handling), but of course also to record any kind of product that is used as consumable for example. 

In purchase documents, it is not possible to register any service into purchase lines (exception: in a bill, you would be able to use the expense tab to do so).
If you buy a service from a vendor, please create a non tracked product and you will be able to select this into a corresponding purchase document.

For sales documents, non tracked products will produce sales related accounting transactions, but no product specific cost of good sold entries into the P&L 

 

Invoices, Delivery Notes and Inventory

Delivery Notes create inventory withdrawals but invoices do not.  In order to send an invoice and affect inventory, you will first need to create a sales order or a delivery note and then convert that into the invoice. Keep in mind this inventory movements are only created for products that are inventory managed.

 

Vendor Bills, Receiving Notes and Inventory

Receiving Notes create inventory entries but vendor bills do not.  In order to affect inventory, you will first need to create a purchase order or a receiving note and then convert that into the vendor bill.  Keep in mind this inventory movements are only created for products that are inventory managed.

 

Automatically updating inventory with Delivery Notes and Receiving Notes

This is an automatic process. There are two kinds of product : the ones that are inventory managed, and the ones that are not. If you use a product that is inventory managed in a delivery note (or receiving note), the inventory is updated.

 

Inventory notifications

By default, when you create an inventory-managed product, OneUp will notify you when a particular action you are taking will cause it to have a negative inventory balance. This includes creating a sales order, delivery note or manual inventory withdrawal containing inventory-managed products. 

 

Creating/inserting opening balances for inventory

With New Inventory Count Sheet, (Inventory - More - Inventory Count Sheets - New Inventory Count Sheet) you can set up in one screen the actual quantity of each inventory managed product you've got. This can be used to make inventory adjustments, or to set up a first inventory.  Each time you make an inventory count sheet, it becomes the active inventory count sheet and the prior one is saved as an historic log.

Note: Inventory count sheets cannot be deleted, a new one must be created to override it.

 

Choosing a valuation method for my products

OneUp offers average costing and standard cost valuation.

Average cost should be used for all trading products. When you buy product you pay a purchase price on them, but when you buy this product next time, it could be price has changed. What we calculate is an average price based on weight: WAP (weighted average price): [(# pieces X # amount) + (# pieces X # amount)] / total pieces

Example: you buy 5 pieces for a hundred then you buy 5 pieces for two hundred, you get a WAP 150 per piece { [(5 X 100) + (5 X 200)] / 10 }

The WAP is also the basis to calculate the cost of goods sold. The WAP calculated is taken over into the products cost. So the WAP (weighted average price of a good sold (CoGs)) is calculated as you purchase, manually enter a stock unit (See related guide Inventory Transactions) or you can manually change the WAP using an Inventory Count Sheet. As soon as you sell and invoice, the cost of goods sold is posted from inventory to CoGs. If you buy a non tracked item, the bill directly posts into CoGs at actual bill cost.

Following the same example above, where you sell this item for 150 WAP, say you sell for 500 then recalculate the CoGS at 150. The gross profit will be 350 and the margin 70% ( 350*100/500 = 70 )

 

Standard costs are normally used in production, i.e. if you need to valuate a product that has either been modified or manufactured.

If you sell a product for a fixed standard cost, you will always have the same cost posted. It will affect your inventory as the product value will always be the same and not be calculated anymore.

In other words the CoGs is calculated based on the standard cost, and the purchase price is not taken into account. This purchase price will be taken as a default into your purchase documents. If the purchase price changes each time you purchase, the standard cost will not be re-valuated. (Which is why this valuation method is not recommended if you do buy with different purchase prices; either by vendor, or because of working with multiple currencies).

You can update the standard cost using an Inventory Count Sheet (change the Adjusted WAP in the count sheet) and your next products will be posted using the new standard cost.

 

Adjusting the Cost of Goods sold for my products

Your inventory value is shown in the balance sheet and also, when you generate a New inventory Count Sheet in Inventory - More - Inventory Count Sheets - New Inventory Count Sheet.

Please note that once you generated such a count sheet and validated with DONE, you won't be able to modify or delete it for audit reasons.

In a New inventory Count Sheet, you will get the possibility to not only adjust your total stock on hand quantity, but also the WAP (weighted average price = Cost of Goods sold) for each product. The adjustment of the value will then modify your total inventory value in the assets in your balance sheet as well as future cost postings of a product, when you sell it.

 

How do I add landed cost such as freight, duty etc. as part of my cost to my product?

OneUp does not offer landed cost (shipping, custom, handling) addition or a landed cost factor.

You will need to track those additional costs and update the WAP from time to time to include the additional cost into your normal WAP product costs.

Register your landed cost either in an expense or in the expense tab in a bill. Your landed cost expenses will be posted into your CoGs, if you select an according account from your chart of accounts.
Of course you are free to use a non tracked product instead of an expense or the expense tab in your bill.
Either way will allow you to evaluate the total landed costs. Should you use non tracked products, you check the according product entries, but in any case, you will get the total cost visible in your accounting.

To correct your product cost, please go to Inventory - More - Inventory Count Sheets and modify the WAP in the field “adjusted WAP”.

An increase of your WAP will then decrease your CoGs accordingly and make up for the landed cost expenses posted earlier.

 

Using multiple warehouses with OneUp

OneUp allows the selection of different storage locations for inventory management.

Locations can be used as "in or out" locations, for example, one can be used for delivery, the other one for receiving. You can also perform Inventory Adjustment per location, or transfer stock from one location to another.

 

Handling products that should have different costs

If you have products that are for example obsolete or discounted in any way, we recommend transferring those into a separate location and create an inventory count sheet for that location, to adjust the WAP (Weighted Average Price = product cost).

Example:

You normally sell product A for $10 and have a cost of $6, you sell from location A.

Now you have also old, obsolete products A that you would sell for $6 and that have a remaining cost of only $2 due to depreciation.

You would then create location B and transfer those obsolete ones from A to B. Then you would create an inventory count sheet for your location B and adjust the WAP from $6 to $2.

When you create a sales order for product A, you will be able to select from which location you wish to sell and then get the correct CoGs for your sale.

 

Does OneUp support Manufacturing-related functions?

Functions related to manufacturing are not currently available in OneUp.  These include:

  • Product Trees
  • Assemblies
  • Block/Lot numbers
  • Bundles
  • Kits
  • Multi-level Bills of Material

These features will be made available once the Manufacturing Package is brought to OneUp. Please note that there is no timeline set yet.

 

A manual workaround would be, that you have your components inventory tracked and create manual inventory withdrawals, when you need them to produce your finished good.

Once the end product is produced, you would need to make sure, your product shows "Standard Cost" as costing valuation method when you create the product (Sales - More - Products and Services - New Product or Service).
Manually calculate your Cost of Goods sold and set this up to have your product cost valued and recorded in accounting the moment you deliver.

 

Your finished good must then be entered manually into your stock on hand using a New Inventory Entry sheet (Inventory - More - Inventory Entries - New Inventory Entry).

 

How do I see my inventory value at a specific date in the past?

Please note that the inventory count sheet will always show the quantity and value as at the very moment you generate this report.

You can always check your inventory value at a specific date in the balance sheet in Reports - Accounting.

Should you need the quantity and value by product, you would need to generate an inventory count sheet and subtract inventory entries as well as add inventory withdrawals for the time period between your specific date in the past and the date you generate the inventory count sheet.

 

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