Custom Products, One-Off Purchases in Microsoft Dynamics AX – Do You Really Need a Separate Item Number for Each?

A requirement that almost every client I have ever worked with has, but AX does not offer an actual menu item for, is handling one off purchases, custom products they might acquire for a customer’s request. These are items that need to be on inventory, as they might be listed on BoMs, consumed into production orders, or simply sold on a sales order to the customer. These items need to create inventory and GL transactions, and they need to be included in reporting. The first thought is always to create a new item number for every one of these products, but is it really worth it? There are companies with an integral focus of buying new and different products for manufacturing custom items for their customers. Do these companies really require an excessively long item master? I don’t believe they do, unless they particularly want it. Here are some of the main requirements most of these companies face:

  • Ability to see inventory of each and every item separately
  • Ability to run reports and see transactions for these items separately
  • Keep the cost of each and every item separate and make sure they follow through with the product.

What I do recommend as a solution is that companies think about how many different types of one-off items they usually purchase, and that would need different item groups, item model groups, and/or dimension groups. Once that is determined, they can create as many items as needed from this configuration perspective.

For example, I once had a client who purchased different sized lumber, different shades of paint for all their projects, etc. They created an item called ‘Custom lumber’, as well as another one called ‘Custom paint’. They put them all in different item groups for GL posting and reporting purposes.

The important thing is to make them mandatory and primary batch tracked, with the ‘Financial inventory’ check box turned on on the Tracking dimension group. This check box will ensure that cost value for the product is calculated within a particular batch, not within all available inventory for the item number (of course in relation to the financial inventory settings on the storage dimension group).

Therefore, using the above example, when purchasing 5 cans of paint in pantone color 2705 for a project, business managers would manually create a batch number that would be informative (for example: P2705) and then assign this batch number to the items when received.

Please note that this setup would also support a scenario such as a company that is buying a particular item over and over again, however because all purchases are for different customer projects, the company would like to keep the cost separate.

The following procedure demonstrates the solution.

1. Item is using an item model group with weighted average cost calculation and is batch tracked, where the batch is indicated as financial dimension on the tracking dimension group. The item is using a batch number group manual.

2. Create one PO for 10 pcs @ $20/each. Receive 5-5 into two separate batches.

The cost price for the item is now $20/each for both batches.

3. Create another PO for the same item, 10 pcs @ $30/each and register all 10 pcs to the first batch. Receive the PO.
Now if you look at the on-hand inventory batch by batch, the cost price for each batch is different.

4. Create a sales order for 1 pcs and select the second batch on the Line details / Product tab page. Post the packing slip.
Go to lines / Inventory / Transactions and see the cost amount associated to the transaction.

5. Create a sales order for 1 pcs and select the third batch on the Line details / Product tab page. Post the packing slip.
Go to lines / Inventory / Transactions and see the cost amount associated to the transaction.

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