Kit Processing - Order Entry

When a sales order line is saved in the Sales Order Entry program, the system checks the Assembly Level field in the inventory item being saved to the order.  If the Assembly Level field for the item is not set to K, the system continues with the normal sales order reservation and allocation processing.

If the Assembly Level field for the inventory item in the order line is set to K, (indicating it is a kitted part), the system uses a special function called Reserve Kit to reserve and allocate inventory for the sales order line.  The Reserve kit function does the following.

      The function first checks the inventory quantities for all of the components in the kit and determines the number of complete kits that can be allocated based on the current component quantities available.   This number of complete kits is used to determine the maximum quantity that should be allocated by the system for each of the components items.  The logic is to allocate to the kit sales order line when all of the component items for the kit are available, and to not allocate component quantities that cannot be shipped out as part of a complete kit (due to other missing components).  This option prevents the component inventory from being blocked from sale when other items are required in order to ship the kit. 

      The system then reserves the quantity of each component that will be required in to complete the order line.  The scheduling window of the sales order line is used to determine if the reserved (orders in the current window) and total reserved numbers for each component (total orders for item regardless of schedule date) should be updated or if only the total reserved quantity in the components should be updated.

      The system then updates the allocated quantity in each component based on the quantity of completed kits that can be shipped out.  It also updates the top level kit item and the sales order line with the quantity actually allocated to the order and available to be shipped out.

Important Note:  Since the system uses a special reservation and allocation procedure for Kit Items, the system will NOT allocate any available on hand quantity for a kit item to a sales order line.  The system will always check the component quantities (not the top level item quantity) when determining if the kit can be produced and if the sales order line being entered should be saved as open or as backordered.  If the components are available (enough to produce at least one kitted item), the system will save the line as open.  If one or more of the components are not available (i.e. there are not enough of each component item available to produce at least 1 of the kitted or top level item), the system will save the order line as a backorder or status B.  This is true even when there is an available on hand quantity for the top level or kit item.

Maintaining an on hand quantity on a kitted item can also cause the reserved and or allocated quantities for the component items to be updated incorrectly.  For example: 

      You have a kitted item with quantity one on hand, that is made up of three components.

      You then enter an order line for qty 1 of the kit item in the current scheduling window. 

      In this case, the system will try to reserve and allocate the component quantities used in the kit.  If the components are available, it will reserve and allocate the components (even though you already have a kit in stock).  If the components are not all available, the system will reserve the components and backorder the sales order line.  In both cases, the components are reserved when you already have the top level item in stock.  If the line is allocated to, the allocated number for the components is also off.

Due to these reasons you should NEVER maintain an on hand quantity for an item that is identified as a kit item.   To prevent this from happening, the invoicing/order completion program will NOT allow you to enter a negative quantity for a kit item (to prevent you from putting it in stock when processing a credit memo).  If you need to process returns for a kit item, the kit item should be set up in your returns location as a normal (not a Kit) item.   This allows you to return the item to stock in the returns location, explode the kit components in the same location (using the materials explosion process), and then move the components back into your main warehouse location.  Please see the following section on Returns Processing for more information.