Comparing Assemblies Across Software - Part 4

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Each Wednesday we focus on topics related to inventory, warehouse management and manufacturing for users of QuickBooks and related software. On occasion, we focus on a specific product, including software products that provide functionality related to our "Warehouse Wednesday" focus.

Several weeks ago, we started a mini-series on "assemblies" by looking at QuickBooks desktop products that offer this functionality. In thiss article, we want to look at how "assemblies" (Product BOMs) are configured and produced using Acctivate software.

Acctivate by Alterity Inc. is an add-on inventory solution for users of QuickBooks Desktop. The product is available as either an on-premise or cloud-hosted solution.

Acctivate does not routinely sync with the Items in QuickBooks. Once the initial sync is done, all of your active QuickBooks items are copied to Acctivate, including the quantity on hand and inventory value in QuickBooks.

Next, the QuickBooks items are turned off and Acctivate takes full responsibility for all Inventory Management. Journal entries, sales orders, and purchase invoices will reference the Product Class assigned to the products in your inventory.

Any transactions that impacts inventory, including transactions to the inventory asset account, must be handled only in Acctivate to ensure that it and QuickBooks are kept in balance. When transactions are posted from Acctivate to QuickBooks, you do not see the part numbers. If you want to print the invoice or run any item specific reports you must do so from Acctivate.

Defining Acctivate Products

Now that we understand the relationship between Acctivate and QuickBooks, let’s look at how Acctivate handles Assemblies. First of all, Acctivate use the term "product" instead of "item," so their "product information window" (shown below) is how you configure and control virtually all aspects of your products.

The Inventory Tab part of the product information window contains most of the common information regarding your products, including fields such as the Product ID and UPC, (an alternate product ID). Also included are the primary and an alternate description, and characteristics (size, color, product type, etc.), along with fields designating the product as active or discontinued. 

The Item Type field allows you to select from inventoried items, non-inventoried items, labor items, and several others. If the inventoried item constitutes on of the Assembly Types supported by Acctivate, you will designate that type on this tab, and then access the Bill of Materials for configuration of the related components.

Several other tabs contain information about each of your products. For example, the Price Tab allows products to be priced in numerous ways. Special prices can be established for certain types of customers using price codes, or the list price can be configured using a variety of formulas.

The Vendors Tab permits you to configure multiple vendors for each product, and configure purchase pricing based upon vendor specifications. This tab also provides information on associated purchase orders and order quantities, as well as purchase lead times for each vendor in regard to the product.

The History Tab reflects all transactional documents associated with the product, including purchase orders, sales orders, and assembly work orders. You can go directly to the associated transaction simply by double-clicking any displayed transaction.

The Acctivate Specs Tab enables you to enter more details about your products. You can even link URLs for external documents, embed illustrations or pictures or capture technical specifications.

While there are several other tabs for each product, you should have a good idea about the depth of information Acctivate captures in reference to each product, and specifically in regard to assembly products.

As I mentioned earlier, you select an assembly or bill of materials type for each of your assembly items. There are different types of assembly BOM types based upon the standard or custom assembly modules you might configure when purchasing Acctivate.

Let’s look closer at these types:

Acctivate Assembly (Bill of Materials) Types

Assembly (Standard) – Acctivate includes basic manufacturing functionality within its Standard Assembly feature. This includes the ability to create finished goods inventory for an item from one or more raw material inventory components. The raw materials (components) are allocated to Work in Process inventory during production, restricting them from other assemblies and/or sales orders.

Component inventory may be selected from multiple warehouses, workflow status can be tracked and multiple items/transactions can be managed under a single session. Acctivate uses the term session to represent a single production run or batch.  Each session may contain transactions involving multiple items, lots or serial numbers.

Assembly (Custom) – Custom Assemblies is an optional add-on module that expands upon the Standard Assembly functionality by giving you the ability to manage the design, specifications and production of configurable products. It permits a configurable Bill of Materials (BOM) to be easily established for custom built products, which can be adjusted appropriately to record the actual build. Acctivate supports both build-for-stock and build-to-order manufacturing.  

Assembly (Process) – Acctivate supports Process Manufacturing, primarily for the food, beverage and medical industries. Process Assemblies enable you to managed a variable bill of materials, similar to Custom Assemblies.

Process Assemblies also allow you to track the original production quantity, the actual yield quantity and the variance. Acctivate provides various quantity fields for each process component in order to accomplish this type of tracking:

  • Standard Units – Standard Quantity per each Assembly unit
  • Standard Quantity – Standard Total Quantity for the Assembly Quantity
  • Unit Quantity – Quantity per each Assembly unit for this transaction
  • Actual Quantity – Total Quantity for the Assembly Quantity for this transaction
  • Yield Quantity – Record the actual finished batch inventory from this production run or batch, and actually posts to inventory, rather than the original Production Quantity

This type of production quantity and yield tracking is essential for batch manufacturers looking to not only insure production quality and quantity, but to reduce costs through better batch management. Measures of this degree of complexity typically are found only in much more expensive batch manufacturing systems.

Kit (Standard) – Standard Kits are similar to Standard Assemblies, but they are build-to-order. This allows you to maintain the component inventory only. An additional inventory transaction to “build” the kit is not necessary. Standard Kits require a fixed bill of materials (component) list. Component inventory must be selected from a single warehouse, and then selected on the Sales Order line.

Kit (Custom) – Custom Kits are similar to Standard Kits with some additional functionality.  You can add and remove components, and adjust the Component Quantities for a single Sales Order. Custom Kits also support the ability to Substitute components, if the standard component item is either unavailable or not desired for a sales order.

Now that we have seen the various types of Acctivate Assemblies (both assembly and kit type products), we want to take a closer look at both the process of creating an assembly product, and the process of building assemblies.

Creating an Acctivate Assembly

The process of creating a new assembly item in Acctivate begins by selecting the Product Information window from either the Inventory menu or Products icon. After selecting the option to create a new product, you will proceed through various standard fields of information captured for products, including Product ID and Product Description.

There are many highlighted fields in the Product window that are required. One of those is Product Type, which you will want to set to Inventory. The other is the ‘Bill of Materials’ field. Select the appropriate BOM type based upon the information for each type as described in the previous section (Acctivate Assembly Bill of Material types).

You will continue through the various product fields and, ultimately, reach the point where it is time to configure the various products that make up the Bill of Materials under the Components tab of the product window.

The various component parts are entered line by line, typically in sequence of use, with a quantity set for each item. If you have chosen a Custom or Process Bill of Materials type you can use the Variable field checkbox to indicate any components that can be removed or modified within the BOM during the build.

By the way, Acctivate actually uses the term "session" to represent the transaction that takes place during a manufacturing fabrication or batch process.

Another tab you probably will want to complete while setting up an assembly is the Substitutions tab. Like most sophisticated manufacturing software, Acctivate allows you to define which products can be substituted for another product.

Once defined, substitutes may be selected from the approved list of substitutes on for purposes of sales or fabrication/process completion.

Once you have configured your various assembly products, you will want to put them into production, be that a manufacturing fabrication event or a batch process.

Let’s look briefly at how the assembly process occurs within Acctivate:

Producing Assemblies in Acctivate

You use the Inventory Assemblies window to process each assembly transaction. Component inventory will be allocated to the assembly, thereby reducing the available quantity on hand for sales or production.

When you start a new session, a unique session number is assigned to the Assembly transaction. Acctivate barcodes this number on the assembly documentation, so that it can be used for tracking during the pick and assemble process.

One of many details captured during the assembly process is the Workflow Status, which shows the progress of the inventory assembly throughout production prior to the time the completed assembly is posted to inventory. You can easily define custom workflow statuses within the workflow status configuration grid of Acctivate’s configuration manager.

Earlier, I mentioned the option to mark Bill of Material components as "variable." The default component quantities can be adjusted prior to posting an Inventory Assembly for a Custom Assembly item. While you can add any product to a Custom Assembly, you can delete an item within a BOM that was marked as variable.

When using lot or serial number tracking, you define and record the appropriate lot or serial numbers from a drop-down field within this window.  

The toolbar for the Assembly window provides a mean, whereby you can print the Inventory Assembly Work Order form and provide a standardized template that can be followed during production. Barcodes on the form can be used for purposes of materials picking, as well as updating the Workflow Status associated with the assembly production.

As you can see, the product (item) features, assembly bill of material types, assembly configuration and informational capture, along with the production control steps offered by Acctivate, make it one of the more sophisticated inventory programs offering advanced assembly functionality as an add-on for users of QuickBooks desktop products.