Consumable Inventory Items

[cbolen]

I was wondering if anyone has come up with a good process on how to keep track of consumable items such as screws, wire nuts, and tape. I have been running into a problem where the technicians can not accurately keep track of how much they use these specific items and we then run out of our stock without being notified to orde rmore

[KMarshall]

There is a new feature you can activate on a per-item basis in the Pricebook where items are automatically consumed, via an adjustment, when you transfer them onto a Truck. That would let you still automatically track them in your warehouse for re-ordering purposes, and technicians would just need to be on top of restocking their own supplies as they run low.

[JessicaSmith]

@emilyramirez tell Ryan & team about this one...

[Ben]

As far as replenishment goes, we have our guys fill out a form at the end of the day with everything they need. It's not just a blank sheet, but a list of all the items we have. If you just ask them "what are you out of," they will never remember, but if the list specifically lists each kind of tape, screw, etc it will jog their memory that they used the last of something. 

Keeping track of inventory and job costing for these items is difficult but we have found a solution that works for us. We have a separate inventory asset account for consumables. We created a material item in ST called consumables, with the value of $1 which points to this GL asset account. When we process a stock PO, we sum the consumable items on the order up and enter the quantity assuming $1 per item. So if it's several different items on the order that total $100 of consumables we enter it as 100 QTY at $1 each. Once this PO is exported to your accounting software (we use quickbooks), it will increase your consumables account. 

In order to then decrement this account, we add the consumables material item as a material link to services where consumables are generally used with estimated quantities. For example on a furnace installation task you could add 50 QTY of the consumable material item so every time you sell that furnace $50 of consumables will be added to the job and job costed. When exported, it will lower the value of this account. We have consumables added as a material link to our service diagnostics too, albeit a much lower amount. 

After a few months, you will be able to look at this account, see the consumables going in and out, determine if your estimates were accurate and adjust accordingly. If this account is going up you need to charge more consumables to jobs, if it's going down you're charging too much. 

All this is a bit of a process to get set up but after that it's pretty much automated so you don't have to worry about your techs adding consumables to jobs in the field, just someone checking the financials once or twice a year. Hope this helps.

[michael21]

Best I can tell, there is no easy way to handle these small cost items that are used over several jobs.  We tried tracking and charging them on individual jobs, but it just took too much of the tech's time and accuracy was bad.  We have decided to look at the cost of the item and determine if it merits detailed tracking.  If it doesn't, (screws, foam tape, PVC glue, etc.) we don't set them up as materials, we just keep a good supply of them in the warehouse and dole them out as needed.  We then have to rely on the warehouse manager to keep manual track of them and reorder as needed.  So far that has worked, and the techs have replenished before they ran out while on a job, but it is a risk.

[JessicaSmith]

I think the best way to do this is to buy them in units of 1 BOX. So if you transfer a box of 100 screws from your warehouse to a truck, the warehouse gets replenished. The tech should "use" the whole box on a job when running low, then will get replenished. Your costing might be a little skewed but you'll never get them to charge out every individual screw they use.