Base UOM- Which one is the best?

pa_tou

Hi all!
I am really confused as which Base UOM I should use?

This are facts:
- All My Inventoy value should is base on Dozen UOM . i.e: Value of Item ABC is 10$ per DZ, etc....
- All my Purchase are done with DZ as UOM
- Customer prices are base on Each UOM . However EA could be 16* 2Pairs for item A or could be 4 * 24 Pairs of item B, etc.... representing how the item is packed on the box.
- In my warehouse , all my mouvements are done by box ( each BOx will be scanned) BUT users work with Each only.

So which UOM should I use?

- I know that it alwasys good to have the smallest UOM -- in this case EA?
- Also I cant forget that my inventory valuation is base on Dozen because Each means nothing when talking about inventory value.

ANY IDEAS???? :?

Slawek_Guzek

Hi,

Inventory on Item card and on reports is shown in Base UOM

If it is business requirement just define DZ as Base UOM.

Then you can define for example EACH with the value of 0.1 in Qty. per Unit of Measure (0.1 here means 0.1 x DZ = 1 unit) if you need to do any operation in single units, BOX32 with the value of 3.2 in Qty. per Unit of Measure for warehouse operations (for box of 32 units, for box of 32 dozens you will need to put 32 in the Qty per Unit of Measure field), and BOX16 with the value 1.6 in the Qty. per Unit field for sales operations. Then you may setup BOX16 as your Sales Unit of Measuse, and BOX32 in Put-away Unit of Measure Code.

If you setup Sales Unit of Measure, Purchase Unit of Measure and Put-away Unit of Measure system will suggest relevant units for the relevant operations (BOX16 for sales orders and sales invoices, DZ for Purchase Order, BOX32 for warehouse operations when units are set as in example above)

You may define your Sales Prices in whatever unit you want, but note than prices are not converted. If you define Sales Price for EACH unit of measure and enter on your Sales Order quantity 1 of DZ the price will be 0. If your user buy items in DZ you can define Unit Price on the Item Card or in Sales Price table. Unit price on Item Card if for Base UoM only, so prices for any other Sales UoM needs to be defined in Sales Price table.

Everything during posting will be converted to Base UoM and posted to Item Ledger Entry in Base OuM

If you ever plan for your item to do some individual tracking or serial numbering then you must setup your Base UoM as EACH - 1 for one single unit of Item.

Regards,
Slawek

pa_tou

Hi Slawek thansk for reply.

I understand where ou want to go.
Keep in mind that, in the warehouse even if my products are keep in boxes, users should know how many each i have per box . And each here does not mean unit , it can be 4* 12 PAIRS etc.

When you say 'If it is business requirement just define DZ as Base UOM.', what do you mean. As I need to understand my inventory valuation and other reports i need same UOM for each item and in my case is DOZEN, Each does not have the same meaning for all items.

Also how do you set up Box difference btw sales UOM and Putaway UOM as the selling price is base on Each UOM

How to make sure that I have no decimals for EA as I cant putaway 5.4 Each but 6 each

Slawek_Guzek

I think you mess Unit of Measure with warehouse Bins.

Use Unit of Measure for your 'boxed' items, for example if you buy an item in one pack of 100, and this is usually delivered as a single box, you may define PACK100 UoM, and setup it as default Purchase Unit of Measure.

Then you can order and invoice purchase of 1 x PACK100, or 10 x PACK10, or 100 x 1 EACH which doesn't do any difference to the system. All will be posted to the Item Ledger Entry in the Base UoM, so if your Base UoM is EACH then you will see 100 on inventory regardless what you post on Purchase Order. And if your Base UoM is PACK10 for this particular item you will see 10 on the inventory, regardless of what you post on Purchase Order.

The Bins behaves similar way. You can put to the Bin 1 x PACK100, or 10 x PACK10 - depends how you filled your Purchase Order and then Put-away. When you check what is in the Bin you will see quantity - in exactly the same UoM as you filled on Purchase Order and Put-Away. This is default what you can see on the Bin form, but there is one more field Quantity (Base) which holds the information about quantity in Base UoM for particular Item.

If you modify the form 7304 Bin Content and add Quantity (Base) field you will see both quantities. There is nothing to setup here, everything what you need is already in place.

BTW. Quantity (Base) is on all warehouse documents, and on Sales and Purchase Lines, but is not displayed on most of the forms.

'If it is business requirement just define DZ as Base UOM' means that if your business measures everything regarding particular item in dozens, and you want to know how many dozens of particular item are currently on the stock just use dozen (DZ or DOZEN) as your Base UoM for this particular Item. Then you have to remember that if you see 10 on your inventory this means that you have 100 of Items, which may or may not be important.

Item Units of Measure are setup individually for each Item so DOZEN for item A may or may not mean the same as DOZEN for item B, however I would recommend to setup some meaningful names, and for example assume that EACH means one single unit of item (regardless how the item is packed, bought moved or sold), and if you buy or sell in pairs setup PAIR as 2 of EACH, if in boxes of 14, setup BOX14 as 14 of EACH and so on, and keep the same convention for all of your Items.

You don't need to setup the same Item UoM for all of your items, if one item is sold in boxes of 16 and 32 setup for that item EACH as Base UoM ('common' unit for all), and setup additional Item UoM: BOX16 (16 of EACH) and BOX32 (32 of EACH). For other item which is sold in boxes of 50 and of 100 setup EACH as Base UoM, and two more UoMs: BOX50 (50 of EACH) and BOX100 (100 of EACH).

Then you will see all your inventory in EACH UoM (how many single units regardless of packing are currently on the stock), and Bin Content in actual unit of measure AND in EACH (after small modification of form7304).

You can call this 'common' unit whatever you want, could be EACH, could be EA, could be UNIT, whatever, but remember to setup the same Unit of Measure for all of your items, and later select it as Base UoM for all of your Items. If you follow this way you can easily compare and valuation of your stock or items.

To sum up:

There is Unit Of Measure table which is meaningless - it is just common dictionary for all the unit of measure.

Each Item has its own one or more Item Unit of Measure, which is meaningfull but only for that Item. One of the Item Unit of Measure you select as Base Unit of Measure for that Item, and in addition you can setup couple more Item Unit Of Measure which are related to selected Base Unit of Measure for that Item.

All Item Unit of Measure must be defined in Unit Of Measure table, but as I said - Unit Of Measure table is only a dictionary, and means nothing for any of Item or documents.

Regards,
Slawek.

pa_tou

Thanks very much Slawek.
However, my costing method is `standard' and the standard cost of all my item is base on Dozen . i.e: 10$ per dozen, etc... that`s why i though of using Dz as my Base UOM instead of EA, .....

Mindie

You will run into less problems if you have your base UOM as the smallest unit. This will avoid any rounding issues. You can always buy and sell in other UOMs.

DenSter

Dozen could be fine for base uom, if that is the smallest unit, and if larger units are always a whole multiple number of dozens. You will get into trouble when you start selling 10-packs with a base unit of dozen, as your inventory will then say 10/12 dozen of your item in inventory.

In my opinion it's better to keep base unit to each, and purchase/sell in dozen. You can set up pricing per dozen, so that should work perfectly fine.

Savatage

It's always a pleasure seeing Quantity on hand as 12.88883
anyway, I'm a big believer in Base uom as ea.

Infact I propbably have something like this oninsert of a item

IF ItemUnitOfMeasure.GET("No.","Base Unit of Measure") THEN
  VALIDATE("Base Unit of Measure")
ELSE BEGIN
  ItemUnitOfMeasure.Code := "Base Unit of Measure";
  ItemUnitOfMeasure."Item No." := "No.";
  ItemUnitOfMeasure."Qty. per Unit of Measure" := 1;
  ItemUnitOfMeasure.INSERT(TRUE);
  VALIDATE("Base Unit of Measure");
END;

DenSter

Won't that insert blank Item Units of Measure? Or do you have 'EACH' set as the initvalue?

Savatage

DenSter wrote:

Won't that insert blank Item Units of Measure? Or do you have 'EACH' set as the initvalue?

yep!

DenSter

nifty