• Real-time sales or period-end sales
• Time limit (must be purchased or returned within specified period)
• What is the freight policy?
• What is the return policy?
• Who holds responsibility for damage or loss while in customer’s possession?
• What are the Insurance implications?
• Exactly how and when is data exchanged? What data is exchanged?
• How are miscellaneous transactions processed?
  • Cycle count adjustments
  • Customer Returns (does a return initiate a credit from the supplier?)
  • Scrap

On IC04, set the Receipt and Inventory accounts to be the same. This will allow a “wash” affect when recording the initial Consignment level via IC20.

Use IC20 to establish the initial stock on hand without creating a PO/Receipt. If the GL Category is setup correctly, IC130 will post an equal debit and credit amounts to the Consignment Account. Because the initial inventory is not owned by the customer, the AP liability is not necessary. Instead, we must record the AP liability only when the Consigned goods are consumed. For this reason, it is most efficient to have reorder points and automatic purchasing associated with Consigned inventory. That way, when shipment occurs via requisition or other form of issue, the stock depletion initiates the PO, Receipt and Invoice cycle. This cycle does the following:

a) Records the Issue/Consignment Inventory journal entry
b) Replenishes the Consigned stock
c) Provides the vendor with payment for the depleted stock
d) Records the Consignment Inventory/AP journal entry

If you don’t utilize reorder points and automatic purchasing, someone has top manually enter a purchase order to pay the vendor and replenish the consumed stock. Regardless, it is a good idea to have a special Buyer code or PO Code that can be used to distinguish Consignment purchase orders. Make sure you have reports that can aid in reconciling the Consignment account.

Sometimes business arrangements with the vendor require the customer to track specific components, for example, to enforce product warranties. Serial tracking can be used to satisfy this requirement. When the Serial Tracking flag is set on Item Master IC11, the user is required to enter additional details when receiving or issuing:

Serial details are stored in the related file called ITSERIAL. You can Drill Around on an item to find out which serial numbers make up the stock on hand, and query ICTRANS to determine which serial numbers have been issued (using Lawson MSAddins or Crystal Reports).

In order to notify a vendor about which serial numbers have been consumed, you’ll need to make some modifications to the Purchase Order. To accomplish this without significant modifications, you are probably limited to using a user field on the PO line. If you want to make this a little easier on the buyers, you could modify PO23 to have a drop-down from ITSERIAL for the item on each PO line:


Then, their selection would be written to a custom table, a user field on the PO line, or to the PO line comments.

Making the PO form modification in Design Studio might be a little less intrusive (you wouldn't be modifying PO20/PO23 base code, you'd be layering on top of it), which would help you from a maintenance and support standpoint. In other words, if you modified the LID version, you'd have to reapply those modifications after installing CTPs and/or MSPs.

Once the serial number is captured on the PO line, you will need to get that information to the vendor as part of the PO. How this is done would depend on how you issue your POs, (i.e. running them thru printing software or sending an EDI file). With printing software, you have a bit more flexibility for doing database lookups, etc. If printing on plain paper or sending an EDI file, you will need to make the modifications directly to the files created by Lawson.

There are many factors involved in managing a Consignment inventory, and success begins with trust. Both the supplier and the customer must allow the program ample time to develop; tweaking and learning from each other along the way. Both supplier and customer must be “on the same page”, and there are a variety of metrics that can be shared to measure progress. Included among the metrics are the number of Purchase Orders per month, total transportation costs, the number of items returned to the manufacturer & the costs involved (both on the manufacturer & distributors side).

So what are key performance indicator(s) for monitoring the Consignment process? There are four KPI's for monitoring the success of a Consignment program:

• Inventory Value
• Inventory Turns
• Fill Rate to the customer (Service Level)
• Fill Rate to the customer’s customer

Once the Consignment relationship begins, regularly review these KPI's by Movement class, comparing the current levels to pre-consignment levels and to the target level. It is only through this type of before/after comparison that you can get a clear picture of the success or failure of your program.
 

Here’s a quick overview of how Lawson supports (and in some ways, doesn’t support) multiple languages, known in the industry as “ERP Localization”.

• Dutch
• French
• French Canadian
• German
• Italian
• Latin Spanish

• French
• French Canadian
• Latin Spanish

There are no plans to support Italian. You would need to make a request to your client manager for the additional language to have it reviewed. This would not guarantee an Italian language file would be created, but it would be a starting point.