Customer Owned Inventory - How to manage / handle?

Epicor ERP 10
,
1

Here is the scenario:
(1) Manufacturing Part# 123456
(2) Need to add customer supplied parts ABC, DEF, GHI to Part# 123456

Questions:
(1) Is there a Customer Owned Inventory (COI) module or specific menu option?
(2) How do I get those parts from the customer into EPICOR?
(3) How do I separate them to know which parts come from which supplier?
(4) If no COI module, then are parts created with $0 cost, acquired with POs, and received to COI warehouse / bins?
(5) If COI module, please provide link to user manual or EPICCARE course.

Thanks
Tony

2

(1) There is no module for this. (There is a Customer Owned feature for ship parts to a customer but they don’t get invoiced until they consume it.)

(2) Use a purchase order from the customer or the RMA module to receive the parts (no sales order required, and you can inspect them on the way in).

(3) What supplier? These are coming from the customer. The Customer is the supplier.

(4) Create the parts as stockable, zero cost, with a Part Class of Customer Owned.

(5) No module.

May want a customer Warehouse and/or Bins to segregate inventory, cycle count, etc.

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3

Thanks Mark. Can you elaborate on (2)? How would I use the customer’s PO? In addition, have you ever selected “Customer Managed” when creating a PO? Does that mean that I would select a customer? I did not see them when I searched for one.

4

It depends on how the materials are supplied to you. If they are supplied by the customer, then set the customer up as a supplier. When running low, you order from them and they ship it to you.

If the customer is just shipping what they think you need, use the RMA system to receive the materials into your inventory.

If you are ordering it for them, then that is a different story. The system should reflect the business situation. Maybe you can elaborate on that a little bit more.

Forget the Customer Managed capabilities in Kinetic. That’s not what it is for. The use case is you make your product, ship it to the customer. It’s still YOUR material in YOUR Bin but at a customer location - until they consume it. At that point, it’s theirs and you invoice them. Consignment inventory is probably a better name.

5

Thanks Mark. We are currently using (4) Create the parts as stockable, zero cost, with a Part Class of Customer Owned, but supply chain would prefer to use RMA. Either way, you provided the input we were looking for. Will have to see how it goes.

6

You should be able to set up a bin as customer owned. There is some set up required on the Customer and Supplier records. Here is a write up I did after doing some testing just a couple of weeks ago.

This has been in place since Epicor 9

Notes on Customer Supplied Material

Thursday, October 26, 2023
10:37 AM

Accounting treatment
When parts are received into the customer bin location, there are no financial transactions recorded.
Parts can be issued to jobs from the customer bin location to jobs which will reduce the on hand quantity in the customer bin location. The value of the parts issued to the job will be at zero since they are customer owned.
When the finished parts are shipped to the customer, the cost of the customer supplied material is not recorded, but any added costs to produce the finished part is credited to the WIP Accounts and Debited to the Cost of Goods Sold Accounts (assuming the shipment is from the job).

Set up requirements
Customer Information
• The Customer needs to also have an associated Supplier Number.
• On the Customer Record, click on the Managed Suppliers in Epicor 9, Additional Tab in Epicor 10, then Managed Suppliers.
• Use the file menu and select New Managed Supplier.
• In the Managed Suppliers form, enter the supplier ID that is used when purchasing from the Customer

Warehouse Bin
• Open the Warehouse Bin menu, which is located in the Material Management/Inventory Management/Set up folder.
• Add a new bin - use a bin ID that follows your standards. Suggestion is to use the Customer ID for the Bin Number and use the Customer Name for the bin description.
â—‹ Note, there is no need to identify this bin as Non Nettable.
• In the Type section of the form, select Customer Managed, Then add the customer id in the customer field.
• Save the record and exit.

Creation of Purchase orders
• When creating a purchase order for customer owned inventory, you need to select the Type of PO. This field is on the Purchase Order Header Sheet just below the PO Number.
• Select Customer Managed.
• Add the PO Lines for the parts you expect to receive from the customer.
â—‹ The unit price should be zero.
• Save the PO.

PO Receipt
When the user adds a new Receipt line and references the PO Line the customer bin location will be populated. Since the PO type is Customer Managed, you can only receive the quantity into a bin location that is marked as Customer Managed. The application controls the bins based on the following logic.
The Supplier ID on the PO is referenced against the Managed Supplier Record on the Customer and then confirms that the Customer ID is associated with the bin on the receipt transaction.

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