SYSPRO Supply Chain Transfers - Goods in Transit Introduction

Posted by Gerry Poe


Supply Chain Transfers - Goods in Transit - enterprise tools to manage, and control inter-company stock cost and visibility.Portrait of male manager using digital tablet in warehouse

A standard of SYSPRO's Goods in Transit facility utilizes Supply Chain Transfers (SCT) providing the tools for greater management, control and visibility over stock items that are in the process of being transferred between warehouse locations. Forming a core component of the Distribution Requirements Planning (DRP) and Material Requirement (MRP) systems providing a primary reconcilable book of account for materials between your company's locations.

Goods in transit may refer to merchandise and other inventory items shipped by a seller, but have not yet been received by the purchaser.

In our case, we will discuss goods in transit from facility A to facility B. i.e.: An inter-company materials management and document handling system designed specifically to control corporate inventories with multiple locations/warehouses. The Goods In Transit system within SYSPRO, gives the ability to see where stock transfers out of one facility are destined and holds all costs and materials in "suspense" until received by the designated facility. Added costs, such as freight and handling, can be apportioned to the transfer revaluing the goods upon receipt.

Inter-Warehouse Transfer - Inventory

A setup option allows your company to select if the Goods in Transit feature is to be adopted or not. If GiT is not adopted, then the current method of transferring between warehouses will be unchanged. Four methods are available; immediate, in, out, and out (no destination).

If Goods in Transit features are adopted, the capability to transfer out (no destination) and the immediate transfer facility will still be available in an unchanged form. However, the transfer out and transfer in mechanisms will offer the user far more control on the movement of stock items.

As items are transferred out of a warehouse, a record is made of the entire transaction, including all lots, bins and serials involved in the transfer. Each item can be assigned a separate transfer number, or many items can be added to the same transfer. Within this module, the stock is depleted from the warehouse at the time of confirming each line of the transfer. Once all the lines have been added to the transfer, a transfer document may be printed live, or may be printed later as a batch. An option is available to print a document per line as the lines are being entered, or to print a document per transfer reference once all the required transfer lines have been entered.

The record of outstanding transfers will control the transfer in. The user will be presented with the outstanding transfers for his selected warehouse. The operator who will have options such as selection by source warehouse, selection by expected receipt date and selection by stock code will tailor the review.

The operator can select to receipt the quantities transferred, or can change the receipt quantity to effect a partial receipt. If a partial receipt is selected, the transfer line can be completed at that point, either by updating the source warehouse with the difference in stock quantity and posting an adjustment transaction, or by writing off the stock and posting an expense transaction.

If lots, bins or serials were transferred, and a partial receipt is selected, the user will be required to select the ones that have been received. Only those available on the review may be receipted in.

Warehouse Transfer Defaults

To enable the user to control the way in which transfers are made (see Supply Chain Transfers), and also to provide a faster method of entering information, an inter-warehouse matrix must be maintained. This matrix specifies the defaults to be used when transferring from a source warehouse to a target warehouse. The following items are defined:

  • Lead time - This is the normal time taken to move the stock from one warehouse to another, and is used to calculate the expected delivery date.
  • Transfer cost multiplier - This is the multiplier used to calculate the additional non-merchandise cost to be added to the transfer cost to obtain the receipt cost.
  • Transfer ledger code - This is the transfer cost ledger code. This must exist at the company level if not supplied here.

Any of the above may be entered for a specific stock code/target warehouse/source warehouse combination, as the global warehouse default may not be suitable for all stock items within the warehouse.

Inter-Warehouse Transfer - Costs & Integration

A cost multiplier is available during transfer to enable the cost of the item from the transferring warehouse to be increased by a non-merchandise portion. This may be used for such things as freight or handling charges. This multiplier may be set up in a matrix if required. This may not take into account the nature of an individual stock item, which could have extra transport costs associated with it. Should the warehouse multiplier be unsuitable for a specific stock item, then a multiplier can be specified for that stock item per warehouse.

If the multiplier is in use, the user who processes the receipt will be asked to distribute the non-merchandise portion of the cost. In addition, the multiplier or the calculated value can be changed before distribution. This will work in the same manner as normal inventory receipts and purchase order receipts. Any changes will be subject to authority control.

Integration is carried out via the transfer cost ledger account. This may be specified at company level, or entered in the matrix per warehouse combination. Again, it may be recorded at the stock code/warehouse level if required.

An additional entry has been made for Goods in Transit transfers where integration is by transaction type.

Supply Chain Transfer (SCT) - Sales Order Processing

Supply chain transfers in Sales Order Entry enable you to reserve stock for transfer at a later point in time, and provide demand and supply input to SYSPRO's Distribution Requirements Planning feature.

An SCT will be a new form of sales order, and will provide the means of reserving stock for transfer, rather than an immediate transfer out which is provided through inventory movements. Requirements planning will create suggested SCT's based on demand for transfer supplied items.

When an SCT is entered, the user will be prompted for source and target warehouse. These will be in force for the full SCT, and may not be changed in maintenance. The only lines that may be entered are stocked merchandise and comments. The multiplier provides the ability to include transport costs at the receiving warehouse, so freight and miscellaneous lines are not relevant. Non-stocked items may not be transferred.

The line ship date will always be required for an SCT. An option to follow the normal defaults for scheduled order ship date or present no default is available per operator. From the default date, or the entered date, the expected receipt date will be calculated, using either the matrix or the stock code inter-warehouse lead time. This will be adjusted to a working day if necessary. If no default is entered, and the user elects to supply the receipt date, the ship date will be calculated. The user may change either date to break the normal lead time.

'Pricing' will work in the same way as a current IBT, that is the cost of the item will be used as the price, and may not be changed by the user, although it will be refreshed by the current cost at the time of transfer.

Once an SCT has been entered, it may be maintained using normal sales order entry facilities, or it may be processed in the back order release program. A delivery note may be printed from an SCT before it being released, or it may be released directly from any of the lower order statuses. Although an SCT is released, it is not subject to the normal invoicing procedures. Instead, a transfer number is allocated, a document is printed (based on the invoice format) and the warehouse and transfer files are updated in exactly the same way as the inventory transfer. This document may be printed in batch or online, with normal reprint facilities.

At this point, control is passed to the Inventory warehouse transfer system, and the transferred items will be receipted using the transfer in facility, with all the same functions available.

As it is possible to partial-ship an SCT, and the warehouse is updated on production of the transfer document, the SCT is not available for processing via Dispatch Notes.

Supply Chain Transfer - Requirements Planning

The requirements calculation will be changed to add two new features. The first is to recognize a line on an SCT order as both a supply and a demand, and take into account any items that are part of a warehouse transfer waiting to be receipted at the receiving warehouse.

The second is to recognize that a specific demand is from a stock/warehouse combination that is designated as transfer supply, and thus suggest a transfer from another warehouse (SCT), rather than a job or a purchase order. The suggested transfer will be based on either the warehouse designated as the supply warehouse at stock code level, or via the matrix. Lead times will be selected in the same way. A new suggested SCT could trigger a series of suggested SCT's, as each one will create a new demand. It could also trigger either a job or purchase order at the top of the supply chain if the demand carries through to the top.

Replenishment rules and related parameters can be specified at the warehouse level for a stock code, so that the purchasing rule can be specified against the stock code, but the transfer rule against the stock/warehouse. Thus, it is possible to specify some sort of batch rule against the stock code, but to use lot for lot when recommending an SCT. Thus if a rule and parameters exist at the warehouse level for a stock code, this will be used for the calculation in preference to that specified via inventory maintenance.

The queries and reports enable monitoring of transfer items, and reconciliation of transfers between source and target warehouses, as well as reconciliation of transfer values to the General Ledger. The result is a transparent, audited, documented procedural approach to goods in transit.

Suggested SCT's will be presented for confirmation to live SCT sales orders.

 

When your ERP software gets the best of you, and it is time to call us, we have a special SYSPRO USER SUPPORT PROGRAM that can pay itself off with just one call.

 

Tags: Supply Chain Management, Warehouse Management, Goods in Transit, SYSPRO

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