How to handle value-added services by third party vendors?

We're stumped on how to handle the following (i.e., issuing POs and 
accounting for the costs properly):

1. We normally stock & sell ItemA as individual units.
2. It was decided to bundle 3 ItemA's into one package & sell as ItemA-3.
3. We are going to purchase the ItemA's from VendorA, but have them drop 
shipped to VendorB to shrink wrap them in bundles of 3 for us. VendorB will 
then ship the shrink-wrapped bundles to our warehouse.

We've come up with a plan for dealing with this, but it's very cumbersome.

In a perfect GP world, how would one deal with this? The ultimate goal would 
be to have the ItemA-3's in inventory, with the cost being the cost of the 3 
units of ItemA plus the value-added cost of the shrink wrap process.

Bud Cool
Microsoft Certified Business Management Solutions Specialist, GP 9.0 
Currently supporting: GP 9.0, SP2
Bud (544)
1/29/2009 4:13:02 PM
greatplains 29623 articles. 4 followers. Follow

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I assume you're not using GP Manufacturing.  To me, the easiest way to
handle this is to use the Inventory BOM and Assembly Transaction.  I
would set the A-3 BOM up with 2 components - 3 of the Item A and one
component representing the contracted service.

Issue PO for Item A and receive them as a normal PO receipt when
Vendor A notifies you they've shipped.  Issue a PO to Vendor B for the
contracted service item.  When Vendor B notifies you that the items
have shipped to your warehouse, receive the contracted service item as
a normal receipt.  Then, perform an Assembly Transaction to consume
the 3 Item A's and the contracted service item into the A-3 BOM.  This
will reduce the inventory of Item A's and the contracted service item
and increase the inventory of Item A-3 and perform all the accounting
for you.

If you want to see a detailed explanation of how the Assembly
Transaction/Inventory BOM is setup and works, check out this article I
wrote for MSDynamicsWorld here -

Hope this helps,

Frank Hamelly
East Coast Dynamics

fhamelly1 (1404)
1/29/2009 4:33:37 PM

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