Purchasing for Inventory

Purchasing for Inventory

Purchase Order Concepts

• Overview of purchasing employee access: Roles and permissions required to use the purchasing module, ensuring that only authorized personnel can create, modify, or delete purchase orders.

• Overview of the purchasing module: Introduction to the purchasing module's features, functionalities, and how it integrates with other modules within the system.

• Creating different types of POs (Purchase Orders): Detailed steps on how to create general, product-specific, and subcontract purchase orders, each tailored to different purchasing needs.

Types of Purchase Orders

General Purchase Order

• Typically used for supplies (production supplies, inks, threads, screen supplies): Used for procuring items that are not directly tied to a specific sales order but are necessary for general operations.

• Not linked to sales orders: These POs are independent of specific customer orders.

• Not related to specific items being produced for sales orders: These are for generic supplies rather than materials for particular jobs.

Purchasing Methods

Single Order Method

• Purchasing goods on an order-by-order basis: Creating a unique purchase order for each specific requirement.

• Typically used for promotional orders, as each order is unique: Ideal for custom or one-off promotional items.

• Also used for additions to existing POs: When additional items need to be added to an already existing purchase order.

Bulk Purchasing

• Purchasing multiple items for multiple jobs on one purchase order: Combining requirements from various jobs into a single, comprehensive purchase order to leverage volume discounts and streamline the purchasing process.

Contract Purchasing

• Purchasing for subcontract embellishment (if not producing in-house): Procuring services from external vendors for processes like embroidery or printing when these tasks are not performed internally.

• Costs are associated with sales orders: Linking subcontracting costs directly to the respective sales orders for accurate job costing.

On-Site System Overview

• Cloned orders for demonstration purposes: Using copies of real orders to demonstrate system functionalities without affecting live data.

• Using these jobs to go through purchasing, pulling, receiving, production, shipping, and invoicing: A comprehensive walkthrough of the entire order fulfillment process, from procurement to final invoicing.

Purchasing Module

• Three sub-menus:

  • All POs: Listing of existing purchase orders.

  • Creation of general purchase orders.

  • By Order Purchasing: Purchase goods for the order (product).

  • Subcontract.

  • By Line Item: Purchase goods for sales orders and combine them onto one PO.

  • Subcontracting.

  • Creating subcontract POs for multiple jobs on one purchase order.

Viewing Existing POs

• Purchase order IDs/numbers must be different from sales order numbers: Ensures clear differentiation between purchase orders and sales orders.

• One PO can be created for multiple sales orders: Allows consolidation of purchasing for efficiency.

• Information displayed:

  • PO number

  • Vendor

  • Creation date

  • Requested information

  • Ship methods

  • PO types (General, Product, Subcontract)

PO Types

• General: General Purchase Order.

• Product: Product POs.

• Sub: Subcontract POs.

PO Options

• Viewing existing purchase orders: Accessing a detailed list of all purchase orders in the system.

• Viewing the associated order from the PO and vice versa: Quickly navigating between a purchase order and its corresponding sales order.

• Splitting items off a PO (if vendor doesn't have everything): Dividing a purchase order if the vendor cannot fulfill the entire order.

• Returning items to purchasing to add them to a new PO: Sending items back to the purchasing department to be reordered through a different purchase order.

Employee Access Rights

• Located under Utilities > Employee Access Rights: Specifies where to configure employee permissions.

• Focus on purchasing-related access: Setting specific permissions for purchasing module functionalities.

Purchasing Module Access

• Ability to access the purchasing module (yes/no): Determines whether an employee can access the purchasing module at all.

Sub-Menu Access

• Access to All POs tab (yes/no).

  • Edit or Read-Only access for different PO types (all three types): Granting either the ability to modify or only view purchase orders, based on the PO type.

• Ability to create new general purchase orders (on/off).

• Ability to delete POs (general, product, subcontract).

• Separate access rights for deletion: Distinct permissions required to delete purchase orders.

• Allow deletion if a linked payable exists (usually turned off): Determines whether POs linked to existing payments can be deleted, typically disabled for auditing purposes.

Additional Options

• Edit order entry line items from purchasing: Allows editing of sales order line items from within the purchasing module.

• Delete order entry line items from purchasing: Allows deletion of sales order line items from within the purchasing module.

• Override line items to purchase (remove from purchasing queue): Manually removing items from the purchasing queue.

• Return or split line items: Managing items by either returning them to the queue or splitting quantities.

• Override payable to purchase order matching: Manually matching payables to purchase orders.

• Lock a PO (prevent others from editing): Preventing unauthorized modifications to a purchase order.

• Override a lock (administrative tool): Administrative override to unlock and edit locked purchase orders.

Order and Line Item Options

• Create POs on an order-by-order basis (new product or subcontract): Generating purchase orders for each sales order individually.

• Same for by-line item: Generating purchase orders based on individual line items across multiple sales orders.

Creating a General Purchase Order

• Not always necessary; used for tracking supplies: Primarily used for non-sales order specific items, such as office or production supplies.

• Located under Purchasing > All POs: Navigation path to create a general purchase order.

• Click on Add to create a new PO: Action to initiate the creation of a new purchase order.

Steps

1. Assign a purchase order number: Manually or automatically assign a unique number to the purchase order.

2. Fill in vendor information:

   • Vendor selection: Choosing the appropriate vendor from the vendor list.

   • Vendor contact: Specifying the contact person at the vendor.

   • Purchasing agent: Identifying the employee responsible for the purchase order.

   • Phone number (from vendor info): Automatically populated or manually entered phone number for the vendor.

3. Shipped To:

   • Specify the destination (important for contract purchasing/drop shipping): Designating where the order should be shipped, critical for drop shipping scenarios.

   • Use the refresh tool to select a location: Updating the location list to ensure accuracy.

4. Ship Method: Specifying how the order will be shipped (e.g., FedEx, UPS).

5. Ship From: Specifying vendor location (if multiple locations): Selecting the specific shipping location if the vendor has multiple warehouses.

6. PO Custom Fields:

   • Can be set up under Settings > Purchasing > PO Custom Fields: Custom fields to capture additional information specific to the purchase order.

   • Used to store specific information: Tailored data fields for specific organizational needs.

7. Date Information: Date placed, expected ship date, expected arrival date.

8. Add Individual Line Items:

   • Can fill in manually or import products from vendors: Adding products to the purchase order either manually or via import.

   • PO products are only used for general purchase orders: Used exclusively for general purchase orders.

   • Add generic products: Adding non-specific, general-use products.

9. Tax and Shipping:

   • Tax information comes from the vendor: Tax rates and amounts provided by the vendor.

   • Specify shipping costs: Inputting the shipping charges for the order.

Notes

• Notes Tab:

  • Add notes for the vendor (appear on the purchase order): Special instructions or information for the vendor.

  • Add notes for the receiving department: Instructions for the receiving department.

  • Add internal notes: Notes for internal use only.

  • Add notes for the payables department (e.g., special discounts): Information relevant to the accounts payable department.

Printing

• Print Tab: Purchase Order form.

• Can print to PDF.

• Can email directly to the vendor's contact.

Purchasing By Order

• Located under Purchasing > By Order > Product Purchasing: Navigation path for order-specific purchasing.

• Shows a listing of all the different jobs that need to be purchased: Display of all outstanding purchase requirements by sales order.

Steps

1. Select the order you want to purchase: Choosing the specific sales order to purchase items for.

2. Choose your vendor: Selecting the vendor for the order.

3. Put in the unit cost: Entering the cost per unit of the item.

4. Double-check the unit cost before finalizing the payable: Verifying the accuracy of the unit cost.

5. Click on Add to create the purchase order: Action to generate the purchase order.

6. Issue the PO by clicking on Issue:

   • Status updates to Purchased Yes: Confirmation that the purchase order has been issued.

   • Buy information goes away: Removing items from the purchasing queue.

   • The bought tab shows the item and the PO number it was bought on: Tracking items that have been purchased.

Purchasing in Bulk

• Located under Purchasing > By Line Item: Navigation for purchasing items in bulk.

• Shows all the line items that need to be purchased: Display of all items required across multiple sales orders.

Additional Information

• Sort by part number: Organizing items by part number for easier management.

• Use the blue arrow to show all the different orders that have the same part on it: Identifying all sales orders that require the same part.

• Highlight order number to go back to the purchasing of the order: Quick navigation back to the individual sales order.

Steps

1. Pick the vendor: Selecting the vendor for the bulk purchase.

2. Add the line items to the PO: Adding all required line items to the purchase order.

3. Hit Issue PO: Issuing the purchase order.

Using the Integration

• By using SAMR or Alphabroder, you can hit send PO to send it directly into their system: Streamlining the purchasing process by directly sending purchase orders to integrated vendor systems.

Pulling from Inventory

• Located under Purchasing > By Line Item > Pull: Navigation path to pull items from inventory.

• Shows what is currently available in inventory: Display of current inventory levels.

• Deduct items individually or deduct all by click deduct all: Option to remove items from inventory individually or in bulk.

• Isolate with Inventory can be used to show only items with inventory: Filtering to show only items that are currently in stock.

Settings

Purchasing Settings

• Allow alternate purchasing quantities to be greater than the sales order quantity: Option to purchase more items than required by the sales order.

• Additional items can be added to the sales order or inventory: Flexibility to add extra items to either the sales order or inventory.

Purchasing Warnings

• Warn when the delivery date on the PO is later than the due date on the sales order: Alerting users when the expected delivery date is after the required date.

• Warn if the ship method is different: Alerting users if the shipping method differs from the standard.

• Warn if the purchase order address is different than the shipping address: Alerting users to discrepancies in addresses.

Additional tips

• If you realize that a vendor doesn't have an item, you can split the line item meaning that they only had a certain quantity; let's say, for instance, they didn't have the five XLs. They had the other side but they don't have the XLs. I'm gonna split these, so I'm gonna leave the other three quantities on there, but the five is gonna get removed and get thrown back into needing to be purchased.

• If they don't have any of these, okay, I can hit return, and it takes the entire line off.

• Here's where you can override purchasing, meaning I don't want to buy these at all, or I can actually assign these to an existing purchase order.

Subcontract Purchasing

• Located under Purchasing > Subcontract: Navigation path for subcontract purchasing.

• Allows purchasing of a vendor for subcontracting: Procuring services from external vendors.

• You can specify a specific price by using Set Cost: Setting a specific price for subcontracted services.

Purchasing Directly from inventory

• Located under Sales > Home > New Order: Navigation to create an order from inventory.

• Select an inventory order: Choosing to create a sales order from existing inventory.

• Create a sales order for an inventory order and bring any available products: Generating a sales order based on available inventory.

• The products are then automatically sent to purchasing: Automatically routing product requirements to the purchasing department.