Multiple Business Units, Each With Their Own Standard Costs

[RBeaghan (Bob Beaghan)]

Kinetic 2022.1

We are separating the main operating unit of our company into multiple business units. Our “Materials” business unit will hold our raw materials. Our “F&I” business unit will take ownership of those raw materials at time of production (backflushed). The “Materials” business unit wants to show this as a sale at a cost higher than standard (some transfer pricing). This leads me to believe we’ll need two standard costs within the system. Is there a way to have multiple standard costs under one company within Kinetic?

Has anyone else implemented multiple business units under one company within Kinetic? How did you handle transfers of inventory and reflect as a sale to one of the business units?

Any thoughts or assistance would be greatly appreciated.

Thank you.

[andrew.johnson]

It sounds like you may want to use multiple sites, and possibly use transfer orders to move the material from one business unit to another?

Here is a post where someone was asking about applying a freight/handling cost to the transfer.

Transfer Orders Freight Costs Question

Hello, This is not an area I am too familiar with. Is there a way to add any additional cost(freight) to transfer orders? E.g. when a part is ship transferred from site A to site B, then this additional cost(freight) is added to cost of the product when received in site B. Costing method used is Avg. Cost. How do others capture costs when transferring stock between plants/site? Simon