SKU for Manufacturing and Distribution

I want to show you how you can use Stock Keeping Units for manufacturing and distribution and Dynamics 365 Business Central. You can use stock keeping units to enhance production Integrity across multiple facilities and also accurately record and track manufacturing expenses across multiple facilities. So let’s take a look at it.

StockKeeping Units

This is the item I’m going to use in my demonstration it’s a standard item in inventory. You can see that here but what I’ve done is I’ve added stock keeping units to it which means it’s a relationship between the item and in my case the location. You can also make a relationship with an item and a variant code and there’s a couple reasons to do. This what I want to show you is that in my demonstration I have three different locations that produce this finished good item and what stock keeping units allow me to do is to have separate routings for each location. So you can see here I’ve got a routing here for this location in the East Warehouse if I scroll over to the next stock keeping unit I’m looking at my North location I’ve got a separate routing for that and finally in my West location I’ve got a separate routing for that.

Manufacturing – Multiple Routing

So let’s take a look at the routings these are the routings I have for this particular finished good item and all I’ve done is change the time slightly in each location to indicate a slightly different processes in manufacturing this finished good item and all I’ve done is altered the time. You can also see that you could alter the actual work centers or machine centers that an item went through and the labor codes and costs associated with that particular work center so you can have different facilities creating the same finished good in different manners and record the actual cost of that. The actual assembly of that this just enhances the ability to manage your manufacturing operations in your system. If I scroll through the routings here you can see the times slightly change on.

The setup time and the run time this will yield different results as far as the cost of the finished good items and every location. I have this sales order set up for this one finished good from three different locations. This will drive the demand in my MRP process so let’s go ahead and do that. Let me run the planning worksheets. Here are the results.

The planning worksheets are suggesting three production orders for the finished good items you can see those here each of them is in a different location. So I’m going to process these and we’ll take a look at the results afterwards so I’ve completed the manufacturing process. These are the three Ledger entries that were created when the finished good items were finished out of production so scroll over to the right here and you can see that each production order had 10 units on it, but I’ve got slightly different actual costs again this was based on the separate routings for each location.

Distribution – Automated Transfer Orders 

Next I want to show you if you use stock keeping units for distribution you can automatically create transfer orders amongst your locations. So let’s use this item here. This is a finished good items I purchased this from a vendor to a central location and then I want to distribute these out to my other locations as needed. So let’s take a look at these stock keeping units I’ve got these four locations here for this particular

finished good item let’s look at this  one here and what I’ve done is I’ve defined the planning parameters for each location you can see the reordering policy here and also I have a safety stock quantity right here. If I scroll through the other locations you can see that they’re set up similarly I’ve got a safety stock quantity and there we go.

Let’s look at the current availability. The current availability is here.  I’ve got zero on hand you can see that here so what I want to do now is I’m going to run the MRP process and we’ll take a look at the results I’m going to run the MRP process and it suggests these four line items. Let’s take a look at what they are the first three are suggested transfer orders from the main location to East, north and west and the fourth suggestion is a purchase order from my vendor into my main location. So let’s execute that. I’ll carry out the action messages this will create purchase orders and also transfer orders.

Here’s a purchase order to my vendor to the main location I’ll receive that in and I have my three transfer orders right here they’re coming from the main location to each of the east north and west locations so let’s just open one of them. I’m going to execute this as a direct transfer, go ahead and post this and I’ll post the other two. If we look at the results for this item by location we can see now that I’ve got 10 in my main location and each of the other locations have five each to satisfy their safety stock requirements and this is how you can use stock keeping units in Dynamics 365 business Central to enhance production Integrity across multiple facilities and accurately record and track manufacturing expenses across multiple facilities as well.