Lecture Notes on Consignment Warehouse Process in Microsoft Dynamics 365

Introduction

• Topic: Consignment Warehouse process in Microsoft Dynamics 365 Finance and Operations
• Overview:
  • Explanation of the business process for a Consignment Warehouse
  • Demonstration of the process within Microsoft Dynamics 365

Business Process Overview

What is a Consignment Warehouse?

• A business arrangement between a company and its supplier
• Supplier stores inventory stock within the company's warehouse location, known as a consignment warehouse

Advantages

• For Organization:
  • Access to supplier's inventory without upfront payment
  • Payment only made when inventory is sold to an end customer
• For Supplier:
  • Reduces holding costs as inventory is stored at the organization's location

Prerequisites in Microsoft Dynamics 365

Setup Requirements

1. Create a Release Product with Owner Tracking Dimension

   • Ensure tracking dimension is created in the system
   • Path: Product Information Management > Setup > Dimension and Variant Group > Tracking Dimension Groups

2. Select a Vendor acting as a consignment vendor

3. Set Up Inventory Ownership within the system

   • Path: Inventory Management > Inquiries and Reports > Tracking Dimension > Inventory Owners

Demonstration

Creating a Release Product

• Navigate to Product Information Management > Release Product
• Create a new product with tracking dimension group set to owner
• Ensure item model group is set to moving average

Creating a Trade Agreement

• Necessary for purchase price agreements
• Navigate to Procurement and Sourcing > Vendors > Select All Vendor
• Create Trade Agreement with selected vendor

Inventory Ownership Setup

• Navigate to Inventory Management > Inquiries and Reports > Tracking Dimension > Inventory Owners
• Add the vendor as an inventory owner

Conducting the Consignment Process

Creating a Consignment Replenishment Order

• Navigate to Procurement and Sourcing > Consignment > Consignment Replenishment Orders
• Create a new order, select vendor, and add line items with quantities
• Perform a product receipt upon vendor shipment

Viewing On-hand Inventory

• Navigate to Product Information Management > Release Products > Manage Inventory
• Verify stock received under vendor's ownership

Consuming Inventory

• Change ownership before selling to customers
• Use Inventory Ownership Change Journal
• System automatically creates a purchase order upon ownership change

Conclusion

• The consignment warehouse process involves several steps, including setting up products, vendors, ownership, and creating orders.
• The system automatically handles inventory and purchase orders accordingly.
• For further questions, viewers are encouraged to leave comments.

Additional Notes

• Ensure all setups are correctly completed to avoid errors during the process.
• The system’s automatic order creation and receipt handling streamline the consignment inventory management.
• Further resources and videos are available for detailed guidance on related topics.