Consignment inventory

[michael21]

We have a significant amount of the inventory, some materials but mostly equipment, that vendors consign to us.  We keep it in our warehouse until we use it and then report its use to the vendor who bills us for it.  We want to track inventory for this material so we can see what is available but have encountered a problem in these inflationary times.  If we record the receipt of the equipment when we get it, ST locks in the items cost at the time of receipt.  If we then use it after there has been a change in the items cost, we have no way to update the cost of the item to what we are actually going to pay.  This is because ST attaches cost to each serially controlled item at the time of receipt.  The only way I can see how to fix this is to return the item and then rebuy it when its used, but that is too much work and unlikely to be done correctly, so we are reduced to tracking consigned inventory on spreadsheets.  I wonder if anyone else has encountered this issue and how you might have resolved it.

By the way, I have added this to the ideas section as Idea COMMUNITY-I-868 created, labeled "Consignment Inventory Tracking".

[hce_rose]

We put  con-(item#) and it has it own place it goes in the price book .

[serickso]

You are all right. This is very common in the industry these days. Our company carries just a handful of consignment items but when there are price increases it can be a significant amount of money. In my mind it should show in your inventory for use but it should hit the books as a liability for accounting. Would it be possible for Service Titan to eventually have pricebook items that are of a consignment type?  Those items could then hit the books as an asset of “consignment inventory” and a liability of “consignment inventory” and not create a bill for the vendor until used.   This would also be nice because we could pull reports easily. 

[JessicaSmith]

If you go post this as an idea, I’ll definitely vote for it!

[michael21]

Hi Jessica.  I have posted it to the ideas page: COMMUNITY-I-868.  I'd definitely appreciate a vote from anyone and everyone who shares this issue.

[SteveCossette]

The solution we found for this is to track those consignment items in a spreadsheet in google sheets. We dont want those items to hit the books for obvious reasons. 

[michael21]

Hi Steve, thanks for your response.  As I said in my original post, we also are reduced to tracking consignments on spreadsheets, but with consignment inventory as common as it is becoming, and with a system as sophisticated as ST, it would seem that a system implemented solution makes sense.  I agree that the ultimate solution shouldn't hit the books, but if it does, the correction is a simple journal entry to credit the consigned inventory and debit pending payables.  Since it appears that lots of us face this problem, hopefully ST will notice and seek a system enabled solution.

[kdagner]

We do something very similar for equipment since we aren't getting billed for them until they are used. We create/sent/receive purchase orders in ST as we use the items, add the items to the job, and put the PO number on the spreadsheet for that particular serial number consumed.

[michael21]

Hi kdagner, thanks for you response.  Seems like a lot of us have this problem, so hopefully ST will notice and work to seek a solution.  I know that its possible because I worked with a distributor level system that did it.

[JessicaSmith]

You could receive the items and then put those receipts in a batch that you don't export ? Then you could un-receive, edit, re-receive, and export when you've used it?