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Multiple Item Unit of Measures

Apr 11, 2014 | Posted by Olof Simren | Inventory | 7 comments |

Items in Microsoft Dynamics NAV can have multiple units of measures, you can for example sell in one unit of measure and purchase in another unit of measure. This is great, but there are some things to be aware of when setting an item up with different unit of measures.

An item must have a base unit of measure. The base unit of measure is how the inventory quantities are displayed and how the inventory is valued. It is also how it is produced (you can have a Production BOM in a different unit of measure, but the Routing and the Production Order will always be in the base unit of measure).

It is considered best practice to have the base unit of measure to be the smallest one, this to avoid having fractions of units leftover due to rounding. Sometimes this is not possible and then it is good to know what is behind the ‘best practice’ to avoid getting into troubles. Here is an example of how to recreate an issue with different unit of measures:

Let’s say we have an item that we purchase in feet and sell in inch and we setup the base unit of measure to be feet. The items unit of measures will then be setup like this.

ItemUnitofMeasures

The quantity per base unit for an inch is set to 0.08333 (the base unit must always be 1), this field has a maximum of five decimals so it gets rounded like this (which is part of the problem). One feet equals 12 inch (for all the metric people 🙂 ).

We now purchase 10 feet which will create the following transaction.

PurchaseTransaction

After this we sell 120 inch (which is the same as 10 feet), this creates the following transaction.

SalesTransaction

As you can see the 120 inch translates to 9.9996 feet due to the rounding in the items unit of measures. This creates a scenario where we have 0.0004 feet left in inventory which we shouldn’t have.

Setting the items base unit of measure to inch would have prevented this situation (and you can still purchase it in feet). This is why it is always recommended to set the smallest unit of measure as the base unit of measure.

Although, this only happens when there is a rounding involved, knowing this you can say that it is quite safe to setup items with a pair as the base unit of measure and sometimes sell it in pieces or setup an item with meters as the base and sometimes sell it in cm, etc..

The situations that I have seen where it was more or less impossible to set the base unit of measure to the smallest unit was for produced items. In those cases all routings, work instructions, costs, etc. was related to a specific unit of measure and it was not feasible to rearrange the entire production setup just to have the smallest unit of measure be the base.

If a situation like the above already exists then having procedures to adjust the fractions out each month might be appropriate (something like a stock count).

Tags: InventoryItemsUnit of Measures
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7 Comments

Leave your reply.
  • Manish
    · Reply

    July 15, 2016 at 9:54 AM

    Hey there Olof,

    I have one requirement.One of my client is in to business of manufacturing Rubber sheet,the dimension being Length X width X Height. The item code will be created considering width,height as constant but length being a variant.The base unit of measure for an item is KG.Now if length changes ,the weight changes.i Need a provision to insert different conversion rate for each lenght variant

  • Jeanette Stefanik
    · Reply

    February 7, 2017 at 10:45 AM

    Thank you for this post. I am an end user, not a programmer but I understand the concept behind using each as the base unit of measure and carton as a purchase unit of measure. I have a testing environment and can confirm that when I purchase in cartons it adds to the inventory in eaches. Wonderful. But I’m missing a step somewhere. Receiving the purchase order purchased in cartons has put cartons in my warehouse but I want eaches in my warehouse for picking sales orders. Do I need to get our programmers to run some sort of conversion in the background so that those cartons become eaches?

    • Olof Simren
      · Reply

      Author
      February 9, 2017 at 2:41 PM

      Hi Jeanette,
      If you are not using the WMS features then the inventory is always in the base unit of measure (NAV does the conversion automatically when you receive a PO for example). If you are using the WMS functionality then NAV will keep track of the inventory by the different unit of measures, in that case there is some functionality to break down large units (like cartons) to smaller units (like each), on warehouse picks it is called breakbulk for example.
      In you case I am not sure how your location is setup, but the above is the general rules in NAV.

      I hope this help.

      /Olof

  • Nathalie
    · Reply

    October 27, 2017 at 5:28 PM

    Hi,

    We have a Base UOM of THOU and an ALT UOM of LB

    1 THOU = 4.4052LB

    Receiving UOM THOU
    Purchasing UOM LB
    UOM on the Production Order = THOU

    The Production Order is for a contract manufacturer and we’re running the contract manufacturing worksheet to calculate and suggest requirements.

    We’re creating a PO from the requirement. We want the PO to convert to LB

    However, the PO is coming in at THOU and not doing the conversion in the QTY…

    Am I missing something?

    • Olof Simren
      · Reply

      Author
      November 2, 2017 at 9:19 AM

      Hi Nathalie,
      You need to make a change to the code if you want the subcontracting purchase order to have the unit of measure equal to the purchase unit of measure from the item card.
      This is a modification that’s common to make, standard NAV creates the subcontracting POs in the base unit of measure.

      /Olof

      • Nathalie
        · Reply

        November 3, 2017 at 9:58 AM

        Thank you for confirming my suspicion.. 🙂

  • Maarten
    · Reply

    February 14, 2018 at 11:33 AM

    Hello Olof,

    Another great post, thanks. However, using multiple units of measure per Item number would need multiple GTIN (barcode) numbers per that same Item number. At least to the GTIN guidelines (in my European case, EAN guidelines).
    Example:
    – Selling one coke can requires a GTIN number.
    – When selling a whole case of coke cans that case would require another GTIN number.

    Questions:
    1. is it correct that NAV (2017) does not allow for the above situation, using 2 GTIN numbers for one Item number w/ 2 units of measure?
    2. Is it correct that ‘best practice’ advises to create a 2nd Item number in NAV for the case of coke cans?

    In any case thanks for your nice blog posts!

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