Building Assemblies Part 1

Building assemblies, Part 1: Creating an assembly item, components and BOM

Discover how to set up in SOS Inventory the required elements for building an assembly.

What you’ll learn in Building assemblies, Part 1: Creating an assembly item, components and BOM

• Add an assembly item and its associated component items
• Understand what a bill of materials (BOM) is and how it is used by SOS Inventory to relieve inventory
• Create a bill of materials (BOM) for an assembly item

Video Transcript

Welcome to part one of our two-part video series on building assemblies. This presentation focuses on the preliminary actions you need to do prior to adding a build transaction for an assembly. In this video, we will explain how to create an assembly item and its component items. We’ll also introduce a bill of materials or BOM. You will learn what a bill of materials is, how it is used by the system to relieve inventory, and how to create a BOM.

Creating an assembly item

To begin, open a new item page to create an assembly item. For this demonstration, we will do so using the Task Bar’s Add Menu.

Enter a unique name for the assembly in the Name field. The Description field is optional, but if you choose to use it, make sure that the description for the assembly is unique as well.

In the Type dropdown list, choose Assembly. For this example, the assembly is a product that I plan to sell, so I will enter a value in the Sales Price field.

If you wish to track the assembly with a serial or lot number, enable the appropriate box. Like any other item, you must choose the appropriate accounts to be associated with the assembly item.

Because the assembly item is something you build using other items, the assembly does not have a purchase cost.

Select other fields as desired, and then Save and Close. The assembly item record will be added to the Items list.

Adding assembly component items

The next step is to add the items that serve as components for the assembly. Open another new item page and complete the data fields for that component.

Any item type can be used for an assembly component except Category. If you choose Assembly as the item type for a component, it indicates that the item is a subassembly. A subassembly requires its own component items, as well as its own bill of materials.

If the component is not sold as a standalone item, do not enter a sales price. However, you must enter its purchase cost. The combined purchase cost for all components will make up the cost basis for the assembly. But if a component is a subassembly, the cost of that component is pulled from the subassembly’s BOM.

Enter the Starting Inventory data for the component item. When you select the form options listed under the Used On field, please note that Manufacturing Forms must be checked. Enter data for other fields as desired, then Save and Close. Repeat this process for each component item in the assembly.

When you have finished adding your components, check to ensure that your assembly item and all component items are on the Items list.

Creating a bill of materials (BOM)

A bill of materials, or BOM, is the list of assembly components that makes up a finished good. On a build transaction, SOS Inventory uses the BOM to relieve quantities of the items required to complete that finished good. When a build is finished, the system relieves inventory by increasing the quantity of completed assembly items.

The exception to this rule is if you use JIT manufacturing. In that case, the quantity of the assembly item will be unchanged.

However, with regard to component items, the system always relieves inventory by decreasing inventory quantities of the individual components.

When an assembly item is listed on a sales order, the available-for-sale quantities decrease for both the assembly and each tracked component listed on the BOM. This enables the system to monitor component stock levels for reordering purposes.

To create the bill of materials, find the assembly item in the Items list, then select Bill of Materials from the Actions Menu dropdown. In the table that appears, enter each component item for the assembly, in the quantities required to build one assembly unit. If you want to include a note for a component, you may enter it in the Notes column. When you have finished entering all components needed for the assembly, select Save and Close.

This concludes Part 1 of Building assemblies. Now that you’ve created the assembly item, its component items, and its bill of materials, you are ready for Building assemblies, Part 2: Creating a build transaction. Thank you for watching this presentation!