Back to D200: Inventory Order Management Extended Scenarios

Lesson 1: Managing Warehouses

Part 1: Extended Inventory Scenarios

This lesson explains how you can create warehouses in the system and specify warehouse-specific prices and other settings for stock items.

Warehouses: General Information

When your organization has multiple buildings, storage rooms, or other facilities for storing inventory items, you can create multiple warehouses in Acumatica ERP to process and track inventory appropriately for each warehouse. With the Multiple Warehouses feature enabled on the Enable/Disable Features (CS100000) form, you can create any number of warehouses, even virtual warehouses, in the way that best fits your business, with the needed settings for each warehouse. In the following sections, you will read about the management of multiple warehouses in Acumatica ERP.

Learning Objectives

In this lesson, you will do the following:

Prepare the system for the creation of warehouses
Create warehouses
Specify warehouse-specific settings for stock items and prices
Use a warehouse as a source of GL accounts for posting classes

Applicable Scenarios

You may need to create warehouses in either of the following cases:

You initially configure inventory with multiple warehouses in Acumatica ERP.
Your organization adds a new physical or virtual warehouse and needs to define the warehouse in Acumatica ERP.

Multiple Warehouses in Acumatica ERP

In Acumatica ERP, you can implement any of the following typical use cases with multiple warehouses:

In each warehouse, you store a specific set of goods, which is not stored in other warehouses. Each warehouse receives purchased goods directly from vendors. You do not need to transfer goods between warehouses. As an example of this use case, suppose that your organization sells fruits and juicers. You may have a separate warehouse with refrigeration facilities for fruits and a separate warehouse with no special storage conditions for juicers.
You store goods of the same type (as well as goods of diﬀerent types) in multiple warehouses, which can receive purchased goods directly from vendors. Also, you can perform transfers between warehouses, relocating stock items as needed. As an example of this use case, suppose that your organization sells fruits to wholesale and retail customers. You have a wholesale center with a large warehouse, and multiple small shops with local warehouses. The shops can either transfer fruits from the wholesale warehouse or buy fruits directly from local vendors.
You use one warehouse as a distribution center and transfer its goods to other warehouses. Only the distribution center directly receives goods from vendors. As an example of this use case, suppose that your organization has a wide network of supermarkets. You have a distribution center with a large warehouse and each supermarket has its own warehouse. You purchase items only in the distribution center and then transfer these items to supermarkets. You can implement any other use cases where multiple warehouses are involved.

When you enable the Multiple Warehouses feature on the Enable/Disable Features (CS100000) form, the following functionality becomes available in the system:

Warehouse-specific settings for stock items: If the details of stocking a particular inventory item vary in diﬀerent warehouses, you can specify separate details for the item at each warehouse (that is, specify details for the item–warehouse pair) on the Item Warehouse Details (IN204500) form. You can view these warehouse-specific settings of a selected item on the Warehouses tab of the Stock Items (IN202500) form. For more information, see the Warehouse-Specific Settings for Stock Items section of this topic.
The warehouse as a source for general ledger accounts: If you store inventory items of the same category in multiple warehouses and each warehouse has specific general ledger accounts specified on the Warehouses (IN204000) form, you can use the warehouse as a source of default GL accounts for any inventory item. For details, see the Warehouse as a Source of GL Accounts for Posting Classes section of this topic.
The TR order type for sales with transfers: If you use multiple warehouses, you can implement a sales process that involves transferring items between warehouses. To reflect this process in documents, you need to activate the TR order type on the Order Types (SO201000) form.
Warehouse-specific vendor and sales prices: You can define warehouse-specific sales prices and vendor prices for items. For more information, see the Warehouse-Specific Prices section of this topic.
Inventory transfers: If your organization has multiple warehouses, you can transfer items between warehouses. To track these movements of items, you can use inventory transfers, which you create on the Transfers (IN304000) form. For details, see Two-Step Transfers: General Information.

Warehouse-Specific Settings for Stock Items For each stock item at a particular warehouse (that is, for each item–warehouse pair), you can specify the following settings on the Item Warehouse Details (IN204500) form:

The default locations for issuing and receiving the item at this warehouse (if you use multiple locations)
The inventory account to be used for the stock item at this warehouse
The ABC code and movement class assigned to the item when it is at this warehouse
The replenishment settings for the item when it is stocked in this warehouse The system also creates an entity for an item–warehouse pair on the Item Warehouse Details form in the following cases:
When any user specifies or changes the default warehouse for an inventory item on the Warehouses tab of the Stock Items (IN202500) form.
When any user releases the first inventory receipt of a particular item coming to the new warehouse (or another transaction that brings an item to a warehouse for the first time, such as the receiving part of an inventory transfer).

Warehouse as a Source of GL Accounts for Posting Classes

A posting class, which is specified for each stock item, is a group of settings that provide the default values for the purchase, sales, and inventory transactions with the item and define how these transactions will be posted to the general ledger. One of these default values is the source of general ledger accounts to be used for the item, and you can use a warehouse as a source of default GL accounts for an inventory item. You define the source of accounts that the system should use in a posting class by using the Posting Classes (IN206000) form. For example, suppose that you have a separate inventory account for each warehouse. In this case, you can specify the needed inventory account in the warehouse settings on the Warehouses (IN204000) form and specify a warehouse as the source of the inventory account in the posting class on the Posting Classes form. For more information about posting classes, see Posting Classes: General Information.

Warehouse-Specific Prices In Acumatica ERP, you can define vendor and sales prices of an item and select a warehouse for these prices. If no warehouse is specified for a price on the Vendor Price Worksheets (AP202010) or Sales Prices (AR202000) forms, this price is applied to all warehouses that are defined in the system. A price that has a warehouse specified has a higher priority than a price of the same type with no warehouse selected. For example, a promotional customer price that is specific to a warehouse has a higher priority than a promotional customer price with no warehouse specified. For more information, see Sales Prices: General Information and Vendor Prices: General Information.

          The system does not use warehouse-specific prices in accounts payable and accounts receivable
          documents, because these documents do not include warehouse information.

Warehouses: Implementation Activity

In the following implementation activity, you will learn how to create a warehouse and specify warehouse-related settings for stock items and posting classes.

Story

Suppose that the SweetLife Fruits & Jams company is going to open a new retail shop in Miami, Florida, with a small warehouse in it for keeping fruits and jams. The warehouse will contain one location where all items will be stored. Organizationally, the shop will be part of the SweetLife Head Oﬀice branch. This store will specialize in purchasing, storing, and selling exotic fruits (such as dragon fruits and guavas) from Mexico. To track item costs in the new warehouse, you will create a separate inventory account. To prepare the system for the processing of documents for the new retail shop, you will create a new warehouse, specify warehouse-specific settings for the needed stock items, and specify other warehouse-related settings to support the changes in the company's operations.

Process Overview

In this activity, you will do the following:

On the Chart of Accounts (GL202500) form, create the inventory account that you will use for the new warehouse.
On the Warehouses (IN204000) form, create the warehouse for the new retail shop.
On the Posting Classes (IN206000) form, for the posting class to be assigned to fruit items so that the system uses the inventory account of the warehouse when the items are included in inventory transactions.
On the Item Warehouse Details (IN204500) form, specify warehouse-specific settings for the items that are stored in multiple warehouses.
On the Purchase Orders (PO301000) form, process a purchase order and on the Purchase Receipts (PO302000) form, the related purchase receipt. Then make sure that the correct inventory account is used in the transactions generated on release of the inventory transaction.

System Preparation

Before you start creating a warehouse, you should launch the Acumatica ERP website with the U100 dataset preloaded, and sign in as implementation manager Kimberly Gibbs by using the gibbs username and the 123 password.

Step 1: Adding the Inventory Account Before you start creating the warehouse for the new shop, you will create the inventory account that you will later specify in the settings of this warehouse. Do the following:

On the Chart of Accounts (GL202500) form, add a new record.
Specify the following settings in the row:

Account: 12200
Account Class: WAREHOUSE
Type: Asset
Active: Selected
Description: Inventory Asset for FLORETAIL warehouse
Control Account Module: IN
Allow Manual Entry: Cleared
Post Option: Summary
Cash Account: Cleared
Secured: Cleared

On the form toolbar, click Save.
You have created the account that will be specified as the inventory account for the new warehouse. The inventory account for a warehouse is the asset account to be used to maintain the balance of the inventory at this warehouse.

Step 2: Creating the Warehouse To create the warehouse with one location for the new shop, do the following:

On the Warehouses (IN204000) form, add a new record.
In the Summary area, specify the following settings:

Warehouse ID: FLORETAIL
Branch: HEADOFFICE
Active: Selected
Description: Retail warehouse in Florida

In the Location Table table of the Locations tab, add the location as follows: a. On the form toolbar, click Add Row. b. In the Location ID column, enter MAIN. c. In the Description column, enter Location in the Floretail warehouse. d. Keep default values in all other columns. e. On the form toolbar, click Save.
In the Receiving Location box of the same tab, select MAIN. The system will copy this location to purchase and inventory receipts by default.
On the GL Accounts tab, specify the following settings:

Override Inventory Account: Selected
Inventory Account: 12200 - Inventory Asset for FLORETAIL warehouse
Sales Account: 40000 - Sales Revenue
COGS/Expense Account: 50000 - COGS - Inventory
Standard Cost Variance Account: 52100 - Standard Cost Adjustments
Standard Cost Revaluation Account: 52110 - Standard Cost Revaluation Account
PO Accrual Account: 20100 - Inventory Purchase Accrual
Purchase Price Variance Account: 52300 - Purchase Price Variance
Landed Cost Variance Account: 52400 - Landed Cost Variance

On the Address tab, specify the following settings:

Account Name: SweetLife Head Office and Wholesale Center
City: Miami
Country: US - United States of America
State: FL - Florida

On the form toolbar, click Save.
You have created a warehouse for the new retail shop.

Step 3: Changing the Posting Class Settings To track items in the FLORETAIL warehouse, you have created a separate inventory account and specified it in the warehouse settings. Because fruits will be sold from the Wholesale, Retail, and Floretail warehouses, you need to track costs of fruit items specifically for each warehouse. For fruit items, the FDI posting class is used. For this posting class, you will specify that the system must use an inventory account from warehouse settings in transactions with fruit items. To change the settings of the FDI posting class, do the following:

On the Posting Classes (IN206000) form, open the FDI class.
In the Use Inventory/Accrual Account from box on the General tab, select Warehouse.
On the form toolbar, click Save.
With this setting, when an item with this posting class specified is included in an inventory transaction, the system will use the inventory account specified in the settings of the warehouse involved in the inventory transaction.

Step 4: Specifying Item–Warehouse Settings Because dragon fruit and guava items purchased in the Floretail warehouse will have Mexico as a country of origin and these items will be typically purchased, stored, and sold from the Floretail warehouse, you need to specify the item settings specific to the new warehouse. The system will use warehouse-specific settings with the higher priority than general settings specified for the items when you process documents with the items. To specify the settings of the dragon fruit and guava stock items in the new warehouse, do the following:

On the Stock Items (IN202500) form, open the DRAGONFR stock item.
Specify the settings for dragon fruit in the FLORETAIL warehouse as follows: a. On the table toolbar of the Warehouses tab, click Add Warehouse Detail. b. On the Item Warehouse Details (IN204500) form, which opens, select FLORETAIL in the Warehouse box. Notice that in the Inventory Account box of the General tab, the system has inserted the 12200 account. c. In the Country of Origin box, select MX - Mexico. d. On the form toolbar, click Save. e. Open the Stock Items form with the DRAGONFR stock item selected. f. On the Warehouses tab, make sure that the FLORETAIL warehouse is listed and the 12200 inventory account is specified for it. g. In the Default column, select the check box for the FLORETAIL warehouse. h. On the form toolbar, click Save.
Specify the settings for guavas in the FLORETAIL warehouse as follows: a. In the Inventory ID box, select GUAVAS. b. On the table toolbar of the Warehouses tab, click Add Warehouse Detail. c. On the Item Warehouse Details (IN204500) form, which opens, select FLORETAIL in the Warehouse box. Notice that in the Inventory Account box of the General tab, the system has inserted the 12200 account. d. In the Country of Origin box, select MX - Mexico. e. On the form toolbar, click Save. f. Open the Stock Items form with the GUAVAS stock item selected. g. On the Warehouses tab, make sure that the FLORETAIL warehouse is listed and the 12200 inventory account is specified for it. h. In the Default column, select the check box for the FLORETAIL warehouse. j. On the form toolbar, click Save.
For the DRAGONFR and GUAVAS stock items (which existed in the system), you have specified settings specific for the new warehouse.

Step 5: Processing a Purchase in the New Warehouse To make sure that the amounts of the DRAGONFR and GUAVAS inventory items are posted to the correct inventory account for the FLORETAIL warehouse, you will create and process a purchase order and purchase receipt containing one of the items. (You have specified the inventory account the same way for both items, so it is not necessary to test both.) You will then view the details of the generated transaction to be sure that the inventory account you specified is used. Do the following:

On the Company and Branch Selection menu, in the top pane of the Acumatica ERP screen, make sure that the SweetLife Head Oﬀice and Wholesale Center branch is selected.
Create a purchase order for 20 pounds of dragon fruit as follows: a. On the Purchase Orders (PO301000) form, add a new record. b. In the Vendor box of the Summary area, select GLORYFRUIT. c. In the Description box, type Purchase of 20 lb of dragon fruit. d. On the table toolbar of the Details tab, click Add Row. e. Make sure that in the Branch column of the new row, HEADOFFICE is specified. f. In the Inventory ID column, select DRAGONFR. g. In the Warehouse column, make sure that FLORETAIL is specified. h. In the Order Qty. column, type 20. j. On the form toolbar, click Remove Hold. The system automatically saves the purchase order.
Create and process a purchase receipt for the order you have just created as follows: a. While you are still viewing the purchase order, on the form toolbar, click Enter PO Receipt. The Purchase Receipts (PO302000) form opens with the relevant details copied from the purchase order. The purchase receipt has the Balanced status, so it can be released. b. In the only line, make sure that in the Location column, Main is specified. c. On the form toolbar, click Release. d. On the Other tab, click the link in the IN Ref. Nbr. box. The system opens the Receipts (IN301000) form in a pop-up window with the inventory receipt that has been created (and automatically released upon creation) for the purchase receipt. e. On the Financial tab of this form, click the link in the Batch Nbr. box. The system opens the Journal Transactions (GL301000) form in a pop-up window. In the table, you can see that the system has debited the 12200 account for this transaction. This means that the system has used an inventory account specified in the FLORETAIL warehouse settings.