Using SAP Units of Measure in Manufacturing Plants

Discover how Boyum using units of measure for manufacturing can streamline your processes. This guide illustrates the implementation of SAP Business One units of measure specifically tailored for manufacturers, accommodating diverse packaging and shipping needs.

In many industries, products can be produced, stored, sold, consumed, and purchased using different units of measure (UoM). For example, an item can be stored by case, produced by piece, sold by dozen, and distributed in boxes. Organizations can track all transactions seamlessly by setting up UoM for sales, inventory, shipping, and more.

User Perspective on Functionality

Inventory Setup Personnel

Two key groups within the manufacturing plant must comprehend the functionality of units of measure: those responsible for item setup and the shipping department staff.
Personnel tasked with setting up new items in inventory need to understand how each product is packaged and sold. Knowledge of item sizes and the necessary packaging is crucial. For instance, an item may typically be shipped one at a time in a box or 12 items per box, with 20 boxes on a pallet. It's vital for these team members to define 'package types' and 'units of measure' accurately, ensuring each item has default packaging configured correctly.

Shipping Department Requirements

The shipping department relies on the packaging information the inventory setup team provides. They must know how each item is packaged and understand where to locate this information within SAP. Additionally, they should be equipped to handle situations where default packaging cannot be used.
For example, while parts usually ship in pallet loads, there are occasions when items, such as engineering prototypes, may need to be shipped individually or in smaller boxes. Shipping department personnel must be adept at adjusting specific shipments as needed.
A SAP Business One consultant can help clarify the nuances of units of measure, ensuring alignment between the inventory setup team and the shipping department.

Ensuring Efficiency in Shipping

When the setup is executed correctly, and default packaging is established as the norm, the shipping department can efficiently fill orders and package products without confusion. Proper engagement with companies regarding their SAP setup is essential, and this is where a SAP Business One consultant plays a pivotal role.
By collaborating with a skilled SAP Business One consultant, your organization can ensure that your team effectively utilizes units of measure for improved inventory management and shipping practices.

Instructions:

Setting up New Items

After the packaging and units of measure are set up, new and existing items must included the packaging information. The screen below shows that the 'UoM Group' is the 'Production' group. In the sales data, the 'Sales UoM Code' is 'BOX1_20'. If you refer back to the item group setup, the BOX1_20 unit of measure contains '20' parts. This part 'Auto1' therefore is normally packaged in a box that is the 'BOX1' size (18" x 18" x 18"), and contains 20 'Each' of this item. Additionally, the package type is the 'Wood Pallet' and this pallet contains 24 boxes of the item.
Let's review the math involved. First, the pallet is 6' x 4' or 72" x 48". This means that 2 but not 3 boxes at 18" can fit in the width of the pallet. Likewise the 72" of pallet will allow for 72/18 = 4 boxes - the length of the pallet. This means each layer of boxes on the pallet contains 2 x 4 = 8 boxes. With 3 levels of boxes, the pallet contains 24 boxes. If you looked at the 'Inventory Data' tab, the UoM Code is 'Each', and the weight is 0.85 pounds. The 0.85 pounds is also shown on the Sales Data tab.

Shipping UofM

The items are set up properly in the item master with the units of measure and unit of measure group defined for each item that is being shipped. A sales order is created for this item. Note that the quantity being shipped is identified in 'Boxes' - Box1_20 in the example below. The actual inventory quantity is shown as 480 = 24 x 20. The unit price is in the selling units of measure - $44.00 in this case, or 2.20 per each unit of inventory. This information defaults as the sales staff enters the order.
When the sales order is being shipped, standard SAP procedure is to 'Copy' the order to a delivery order. After doing this, let's review the default packing slip as shown below. The packaging defaults to a single pallet with 24 boxes of the part - as we would expect. NOTE: this occurred without user intervention.
UoM in action - video
UoM Setup - Video
packing slip Crystal report changes
UoM documentation - word

Units of Measure

If you access SAP B1 tutorials on units of measure the examples deal with distributors of products. The ‘paper’ sold in reams, boxes and pallets is their example. 6 packs of soda vs 24 packs of soda are other examples. Based on my experience here are more likely scenarios in a manufacturing plant: Parts are sold with part specific packaging
  • Packaging for an axle assembly for a car or truck – the packaging is designed to fit the part.
  • In many instances the packaging becomes part of the BOM for the part – because that is the only way it is shipped.
Parts are placed in standard box sizes, so many pieces to the box
  • Parts are placed in standard box sizes, so many pieces to the box
  • Most often a plant has a limited number of box sizes – perhaps 8 – 10 sizes to handle the non-designer packaging in the plant
  • In many cases boxes of parts are placed on pallets for shipment
  • Certain sized boxes are placed in ‘layers’ on a pallet
  • Depending on the box size and the weights of parts, only so many ‘layers’ of boxes can be placed on a pallet. This is known in advance and most plants are shipping the same parts on a regular basis.

UofM Setup in SAP

There are three setup functions within SAP to perform for units of measures. The first is that the default 'packages' need to be input. In our example, only the 'Pallet' and 'Loose' needs to be defined.
The second is that units of measure must be defined. In our example below there are 6 box sizes set up. Your plant could have many more sizes. You also need an 'Each' unit of measure as that is likely the smallest unit of inventory for many parts.
The third setup is the units of measure 'group' setup. This provides the means to assign different U of M groups depending on the types of products you are shipping. This links the U of M groups to the units of measure - review the screens below for examples. Note: you could set up different UoM groups if you had products that used specific packaging.

Benefits of UoM Definitions

The units of measure and default packaging default on the delivery order. So what are the benefits of this? First of all, the shipping department does not have the 'extra' work of defining the packaging. This means that a packing list report can be generated immediately and it would show the pallet and box information. An example is shown below. Second, with the packaging all pre-defined the user could use Boyum and B1 Print and Delivery to automatically create labels for this shipment. In this instance, the labels recommended would be 48 box labels - 2 per box so the labels are visible from more than one side, and then 2 more pallet labels - again for accessibility. Note: Depending on your label needs you may need to buy bar code fonts - and integrate this with Crystal Report writer. Note: Check out the QR Code usage within SAP - described in detail on Mascidon's web site. This may be the alternative bar code you want to use.