Production on Assembly Documents

A perfume house fills 200 bottles of a custom scent for a hotel chain on a Tuesday afternoon. Six litres of oil, two of alcohol, 200 bottles, 200 caps and 200 gift boxes go in; 200 boxed bottles come out. There is no routing, no work centre and nothing waiting half-finished between stations. It is one recipe and one step, and the only hard questions are which components left the shelf and what each bottle now costs.

That is the job of the assembly screens. They are the "light manufacturing" inside the inventory module: a recipe, a document that takes the components out of stock and puts the product in, and a cost that moves from the first to the second. This page walks through how companies run their production that way.

Who this fits

• A business that makes a product from a known recipe in one step: blending and filling, packing and repacking, kits and gift sets, printing jobs, kitchens and food preparation, steel fabrication, and engineered equipment built to order. Nobody needs to track work centres or work in progress.
• Across Nama installations, about 1 in 4 companies produce on assembly documents at least once a month. Factories are not the only ones: about 2 in 3 manufacturers work this way, and so do about 1 in 4 distributors and 2 in 5 retailers that blend, pack or bundle what they sell.
• It usually runs alongside a selling scenario, either Direct-Invoice Trading or Order-to-Cash Distribution. Companies that buy their components abroad add the Importer flow, and shops that pack in the back room combine it with a Retail Chain with Point of Sale.
• About 1 in 7 of these companies also run the Full Manufacturing Cycle for their staged products, and keep assembly for the simple ones.

What you need

Required licences

supplychain-assembly, supplychain-inventory; add supplychain-sales when production follows a sales order.

• Assembly & Packaging: the recipes and the assembly documents, all under Inventory → Assembly Documents.
• Supply Chain: the warehouses, the stock issues and receipts the assembly generates, and the costing that values them.
• Sales: the sales order and invoice, when you assemble to order.
• Payroll: about 3 in 5 of these companies also pay their workers in Nama. The workers' time reaches the product cost through the assembly's expense lines, described below.

The document flow

The solid line in the middle is the whole flow at most companies: an Assembly BOM and an Assembly Document. The dotted parts are for assembling to an order. Here is the hotel's order from start to finish.

1. The sales order. The hotel chain orders 200 boxed bottles. Sales records a Sales Order for them at the agreed price.
2. The plan. Production raises an Assembly Request with the sales order in From Document, picks the scent's Assembly BOM (the recipe) and sets the quantity to 200. Every component line is recalculated from the per-bottle recipe: 30 ml of oil per bottle becomes 6 litres. The request moves no stock. If its term has Reserve ticked on the Reservation tab, it reserves the components so that nobody else sells them in the meantime.
3. The components reach the filling room. If they are kept in another store, a Stock Transfer moves them to the production warehouse first. That is an ordinary transfer that the storekeeper makes by hand. The request does not create it.
4. The assembly. On the day, the supervisor creates the Assembly Document with the request in From Document, corrects a line if a different lot of oil was used, and adds two lines on the Expense items tab: filling labour at 2.00 a bottle and the filling line's electricity.
5. What saving creates. The assembly document never touches stock itself. On save it generates a Stock Issue for the components, out of the issue warehouse, and a Stock Receipt for the 200 bottles, into the receipt warehouse. Because it has expense lines, it also generates a Receipt Additional Cost. All three are listed in its Stock Documents grid. Editing the assembly updates them, and deleting it deletes them.
6. The cost. The documents are processed in the background as business requests, and the receipt is costed once the issue's cost is known. Components that cost 9,000 plus 600 of expenses give a bottle cost of 48.00.
7. The sale. Sales invoices the hotel from the sales order. The bottles leave stock at 48.00 each, through the invoice or its stock issue, depending on your sales terms, and the money is collected as on any other sale. See The Sales Journey.

Selling from stock follows the same flow without the dotted parts: the supervisor creates the assembly document straight from the BOM, and the product is sold from the shelf.

Setting it up, in order

1. Items and units. Create the components and the finished items. The BOM's unit must be one of the finished item's primary or secondary units, and each component's unit one of its primary units, so get the units right first. See Understanding Items and Units of Measure.
2. Warehouses. Decide where components are issued from and where finished goods are received. Many companies keep a separate production store. See Warehouses and Locators.
3. Assembly BOMs. Write one recipe per finished item, with its default issue and receipt warehouses and any co-products. Use Components for interchangeable parts and a Packaging Method File for cartons and labels. See Assembly BOMs, Components & Packaging Methods.
4. Expense items for labour and overheads. Create an expense item for each cost you want inside the product cost: labour, energy, machine time. Where the same expenses apply every time, set up Assembly Process Files so the lines are calculated for you. See Expense items and assembly process files.
5. The assembly term. On the term's Effect tab, fill the issue and receipt books and terms, which are required, and the Additional Cost Document Book and Term, which are needed as soon as a document has expense lines. Review the cost-split options there too. See The term's Effect tab.
6. The request term, if you plan with requests: decide whether it reserves the components.
7. Sales terms, if you assemble to order: the sales order and the invoice, and which of them moves the stock. See The Sales Journey.

Settings and tools most companies use

• Additional costs. About 2 in 3 of these companies use additional-cost documents. On an assembly, the expense lines become a Receipt Additional Cost by themselves. See Additional Costs on Receipts.
• Purchase orders. About 7 in 10 buy their components on purchase orders. See The Purchasing Journey.
• Payroll. About 3 in 5 run payroll in Nama. See Payroll.
• Full manufacturing next to assembly. About 1 in 7 also run production orders for their staged products. See the Manufacturing module.

Variations

Batches and multi-level products. The Multi Assembly Document handles a product whose components are themselves assembled, or several products at once. It follows the Sub Assembly BOM links down the recipe tree and generates one Assembly Document per line, and it can be filled from a sales order. With Change Details Status To Create Assembly Documents By Level, it builds the deepest level first and moves up only when that level's stock is in. See Multi-Level and Aggregated Assembly.

Packing lines and machine runs. A packing line that turns bulk material into cartons on pallets all day records the day in one Aggregated Packaging Document, with sorted grades and waste. Work that is better described by the machine than by the recipe, such as a mill with its consumables and hourly cost, goes on a Processing Document that starts from an Assembly Machine. See Processing Documents & Assembly Machines.

Kits sold, not built. A gift set that is only ever sold, and never kept assembled on the shelf, does not need an assembly document at all. Give the item a Disassembly Bom Components Spread Method, and tick Spread Assembly Components With Save on the sales term. Saving the sale then adds the kit's components under its line, and stock leaves as the components. See Document-Specific Options.

Made to order through a request. The Assembly Document's From Document accepts an assembly request, another assembly document or an item cutting document, and it does not accept a sales order. An order therefore reaches production through an Assembly Request, as in the walk-through above, or through a Multi Assembly Document.

Taking products apart. The same Assembly Document disassembles: with Calculate CoProducts From Issued Item Assembly BOM on the term, you issue the finished item and its parts are received back. See Disassembly.

Decisions to make before go-live

• Assembly or full manufacturing. Assembly is one step. When you need routings, work centres, quantities waiting between stages, rework, and an order that is closed and costed at the end, that is the Full Manufacturing Cycle. Some companies keep BOM and routing records in the Manufacturing module and still produce through assembly documents. That is a legitimate choice, not a half-done setup.
• How labour and overheads get into the cost. Type them on the Expense items tab, calculate them from the expense items' rates, or let Assembly Process Files add them. If you choose none of these, the product carries only the cost of its components.
• Per-unit recipe or typed totals. By default the issued quantities are the recipe multiplied by the quantity assembled. If your people type the total of each component, switch on Do Not Multiply Quantities In Assembly Doc in the Supply Chain configuration.
• One issue warehouse or several. A header Issue Warehouse is written onto every issued line on save. If components come from several stores, leave it empty, or move the components to one store first.
• How cost splits between co-products. By quantity, by average sales price, a fixed amount, or no cost at all, set per line. Decide before the first by-product is received. See How the cost is split.
• A request step or not. Requests suit companies that plan and reserve ahead, or assemble to order. Companies that produce as stock runs low usually go straight to the Assembly Document.

Where to read next

1. Assembly & Packaging: the landing page and the screens at a glance.
2. Assembly BOMs, Components & Packaging Methods
3. Assembly Requests & Assembly Documents
4. Multi-Level and Aggregated Assembly
5. Processing Documents & Assembly Machines
6. Inventory Costing & Revaluation
7. Manufacturing Module Overview: the next step up.