VA external fabrication

Typically when you process a product externally, you send raw materials from your inventory to a service vendor who builds the product. The vendor returns the product to you for sale or additional processing. These are the basic steps involved in fabricating a product:

  1. Initiate a fabrication VA order. There are three ways to do this:
    • You can enter a VA transaction to fabricate the product in VA Order Entry. In this case, you may be fabricating the product to put it on the shelf and sell to a customer at a later time. You can also select an existing order to maintain it.
    • You can run the VA Entry Recommended Replenishment Action Report to create fabrication VA transactions for the fabricated products to be replenished in inventory. For a product to be included in VA Entry Recommended Replenishment Report, you must select Fab VA for the ARP Type in Product Warehouse Product Setup. This indicates that the product is normally replenished through the Value Add fabrication process.
    • The customer can initiate the fabrication of a product. In Sales Order Entry, if a VA product is entered and no stock is currently in inventory, fabrication can be specified by clicking Sourcing and selecting Value Add as the Document Information Type. A required note should be attached to the product to indicate that the product is a VA product that requires fabrication. The Value Add order is tied to the sales (OE) order. The product is fabricated, returned to the warehouse, or sent directly to the customer.
  2. Print a pick ticket in VA Entry Processing Pick Tickets Report for those components to be taken from inventory.
  3. Warehouse personnel pick the inventory using the pick ticket.
  4. Create a purchase order for the external process. There are several ways to create a purchase order:
    • You can select the option to create the external process purchase order when the VA pick ticket is printed.
    • You can create a purchase order from the Sections view in VA Order Entry.
    • When the inventory component is shipped, any required purchase orders are automatically created.

    Specifications/instructions for the service vendor can be printed on the pick ticket.

  5. The components are shipped to the service vendor in VA Shipping Feedback Entry.
  6. The vendor performs the work and ships the finished product back to you.
  7. You receive the finished product in Purchase Receipt of Inventory Entry.
  8. The service vendor sends the invoice for the work performed.
  9. The accounts payable clerk processes the invoice and closes the VA transaction.

    You can have more than one external process to fabricate a product. You may have sub-assemblies that are shipped to one vendor for initial processing, shipped to another for further processing, and so on until the fabricated product is sent back to you. The fabricated product, when completed, can be direct shipped to the customer. The raw materials can be direct shipped from the raw material vendor to the service vendor using Direct Order (DO) purchase order. If the finished product is then direct shipped to the customer, your inventory is not involved in the process at all.