Overview

Inventory management is used to handle stock of physical goods and to supervise the movement of products that enter and leave a company's warehouses.

In CRM.COM, a warehouse represents the physical location where sold or rented hardware is stored.  A separate warehouse can be set up for each location from which hardware is retrieved.  Additional warehouses can be set up to represent locations where hardware is returned, in order to distinguish them from unused goods.

Through inventory management module you can set up warranty and return policies which will define the company's policies with regard to the replacement and return of goods respectively. More over if you are looking to implement an IOT business model, inventory management is the module you need.

Setting Up Inventory Management and Core Processes

Before you start using Inventory Management set up the system to reflect your own business needs.

Warehouse Types

Warehouse types are used to group warehouses and assign them different functions. Types are added in the inventory definition to designate warehouses that physical goods are taken from and returned to. For example, one type (Sales) can be defined for use when selling goods directly from a company's point of sale and another (Rentals) when renting out goods. 

Warehouse Types During Transactions

Warehouse Types during transactions control the movement of physical goods that are taken from or returned to warehouses and that are sold or rented to customers.

Provide the type of the warehouse to be used in each event (such as 'For Adding' or 'For Removing') and assign a classification to determine whether the goods are rented or sold.

•  Rentals: Installed items added to subscriptions and not purchased by the customers; the goods must be returned when the subscription is terminated.
• Sales: Installed items sold through jobs or direct sales; the goods do not have to be returned.  If the good is extracted from a proprietary warehouse, the customer is billed through CRM.COM; if the good is extracted from a warehouse that belongs to a partner, the customer is not billed through CRM.COM.

In case of removing from a warehouse you must specify a default for each classification.('Rented', 'Sales')

System process for determining return warehouse during removing

System process for determining return warehouse during replacement

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Warehouses

A warehouse is a storage place for physical goods.  Physical goods (traceable and non-traceable) are located in warehouses from where they can be retrieved and transferred to customers or other warehouses. Each warehouse has a warehouse type and an Owned By Group. The group represents the group that owns the warehouse and automatically defaults to that of the logged-in user (can be changed). Only users with access to the specific group can view and move products in and out of the warehouse. The combination of the Warehouse Type and Owned By Group must be unique. When a customer returns a physical good, the system uses the combination of these two fields to determine in which warehouse the good should be placed.

It is possible for each warehouse to Allow Negative Stock. This will allow the removal of non-traceable physical goods from a warehouse when the stock's quantity is not measurable. E.g., if you have a non-traceable good in the system, such as milk, so that it can be added to an order of (traceable) coffee. Note that negative stock is not allowed when moving goods between warehouses.

Other settings

• Non Stockable Products: A list of physical goods (traceable and non traceable) which will not be included in any warehouse or warehouse transaction
• Installed Item Categories: Categories are used to classify installed items based on common attributes.
• Installed Item State Classifications: Installed Item State Classification are used for defining the reasons an installed item is set as not effective.  An installed item can also be set as 'not effective' automatically through its applied warranty (if applicable) and based on the coverage reason. Refer to Warranty Policies for more information

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Return Policies  

Return Policies

Return Policies define if and when a customer is allowed to return purchased traceable physical goods. The most suitable (subject to conditions defined in the policy) is automatically applied when a good is sold,

A policy must have an 'Effective' life cycle state to be applied. The life cycle state of a policy can be toggled between 'Effective' and 'Not Effective' using a dedicated action. A policy can only be updated if its not effective or it has not yet been applied to a good.

The Allowed Return Period of each policy defines the eligible return period.

Each policy has a Validity which is the period during which the return policy is available defined by a 'Valid from Date' and 'Valid to Date' . Valid from Date is always mandatory, while the Valid to Date can be left empty if the period is open-ended. The validity period is used to determine which policy should be applied to goods when more than one policy is applicable. The policy with the most recent Valid from Date is applied and has priority over 'Always Valid' policies.

In each policy you can define the Physical Goods Covered by the Policy and the allowed Coverage Reasons. For each reason you can select whether Credit will be provided which means that the item will be refunded.

 Return Coverage Reasons

'Return Coverage reasons' are user-defined and provide information associated to the return; for example, 'returned in good condition' 'damaged', 'cannot be resold'.  Once return coverage reasons are configured, they must be added to return policies to determine whether the return is refundable.

 A return coverage reason may refund the return of a physical good when selected for one return policy and not for another.

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Using Inventory Management

Use Inventory Management to manage your company's physical goods (traceable and non traceable) which can either be rented or sold to customers and partners. Before you proceed to find out all the things you can do with inventory management it is important to understand the various terms being used.

Physical Goods

Physical Goods is a tangible commodity which is offered to customers (e.g. decoders, smartcards, cameras etc.) and can either be a traceable or non traceable item. Physical Goods can be provided as a standalone product or a bundle of products and are Sold or Rented to customers or partners, giving them the exclusive ownership of the good.

Traceable Physical Goods (Installed Items)

Physical goods which can be uniquely identified by its serial number are referred to as 'Installed Item' or traceable physical goods. For example, Set top box, modem, car

Non Traceable Physical Goods

Physical goods which are not traced to a single instance and are measured based on their quantity. For example,remote control, coffee,

Physical Goods Bundles

Physical Goods can be created as bundles, representing a package of components (traceable or non-traceable). Two classification of bundles are available

• Fixed Bundles: A fixed bundle of products which contains specific components which are provided as a package (available for both traceable and non traceable physical goods)
• Flexible Bundles: A flexible bundle of products which contains specific components from which a part of them can be provided based on the Customer's needs (available only for non traceable installed items) 

Warehouse Transactions

Warehouse Transactions are used to move stock in, out or between the warehouses. They can either be created by the user or by the system following a user action and there are three types of warehouse transactions

• Stock In Transaction: responsible to add stock into the warehouse
• Stock Out Transaction: responsible to remove stock from the warehouse
• Stock Movement Transaction: responsible to move stock between the warehouses

Goods are always available to agents for stock out transactions but must be posted to be available for stock in and stock movement transactions. In either case, the stock balance remains unmodified. Goods can be added or removed from the transaction as long as it is in a 'Draft' state. Once all physical goods have been accounted for and the modifications finalized, the transaction can be closed (Posted) and the stock balance updated. Use SAVE from the Actions' menu to post the transaction or SAVE AS DRAFT to keep it editable. To post the finalized transaction, go to Manage Warehouse Transactions, select the transaction and click Post from the Actions menu.  Once a Stock Warehouse Transaction is Posted then the Stock Balance of the affected warehouse will be affected.

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Managing Stock

Adding stock to warehouses

In order to be able to sell or rent products they must initially belong in a warehouse except in the case where a good will be imported to a customer's account directly in case that he already owns the good, and he wants to use it.

There are various ways to add stock to a warehouse.

Stock In warehouse transactions

Stock in warehouse transactions is the only way through which you can add non-traceable physical goods to your warehouses.

1. Navigate to Foundation / Inventory Management / Manage Warehouses
2. Click on Actions > Warehouse Transactions
3. Click on New > Stock in Transaction
4. Select the warehouse to import items to
5. Follow the table below on how to add physical goods to the transaction depending on of what you wish to do

Import Installed Items

The fastest way to add stock into a warehouse is by using the 'Import Installed Items' utility and an external file.

1. Navigate to Foundation / Utilities / Import Data / Import Installed Items
2. Define installed item import settings in the utility definition.
3. Click on Submit from the Actions menu and select the file with the items.
   (The file must be prepared for import in one of the following formats (templates can be used): XML, Excel,CSV

Manually create installed items

Installed items can also be manually created through Manage Installed Items page. However, creating an installed item from the Installed Item Data Entry page does not place it in a warehouse. A stock in transaction must be used for the transfer.

To create an installed item

1. Navigate to Foundation / Inventory Management / Manage Installed Items
2. Click on New
3. Create the installed item

Installed items have a State which can be 'Effective' (default) or 'Not Effective' where 'Non-Effective' Installed Items cannot be provided to customers. Manually set an item as Not Effective through Actions > Set as Not Effective. When installed items are Not Effective they have a State Classification which states the reason why the installed item was set as not effective. Both the State and State Classifications can be automatically set to Not Effective by other processes in the system, such as a return from a warranty policy where the coverage reason was set as broken.

Additionally installed items have an Ownership Status which provides information whether the company or customer owns the installed item, depending on the business transaction that was registered. The available values are:

• Sold to Customer through Company : Sold to the customer through the company (therefore it was billed in CRM.COM) and is owned by the customer
• Sold to Customer through Partner:  Sold to the customer through a partner (therefore it was billed outside CRM.COM) and is owned by the customer
• Owned by Customer
• Owned By Company
• Sold to partner: Sold to partner
• Rented to Customer: Rented to the customer and is owned by the company or partner (depending on the warehouse it belongs to)

Import customer assets

Customers can register their own installed items into the system in order to use them. Note however that imported installed items cannot be returned or have their ownership transferred. 

You can import a customer's installed items through their account receivable Manage Assets > Import Asset action or directly upon adding an installed item to a subscription (Import Installed Item). They are easily identified on the installed items page by their 'Owned by Customer' ownership status.

Removing stock from a warehouse

You can remove physical goods from a warehouse through a 'stock out warehouse transaction'

1. Navigate to Foundation / Inventory Management / Manage Warehouses
2. Click on Actions > Warehouse Transactions
3. Click on New > Stock out transaction
4. Select the warehouse to remove items from
5. Follow the table below on how to add physical goods to the transaction depending of what you wish to do

Moving stock between warehouses 

Once stock has been imported in a warehouse it can then be moved between warehouses. This is particularly useful in logistics, where all imported good initially goes to a head warehouse and then transferred to the rest warehouses.

1. Navigate to Foundation / Inventory Management / Manage Warehouses
2. Click on Actions > Warehouse Transactions
3. Click on New > Stock Movement transaction
4. Select the from and to warehouses
5. Follow the table below on how to add physical goods to the transaction depending on of what you wish to do

Viewing available stock

It is possible to view the available stock in each warehouse through its balance. The running balance of stock kept in specific warehouses can be viewed through the Stock Balance section.

If you would like to view the total stock per product then you can use the View Balance action available in the Manage Warehouses summary page.

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Sales Rentals and Returns

Selling physical goods

Customer can buy physical goods. Once a good is bought, it is considered a customer asset and it is available through the customer's account assets. Goods can be bought either directly through the company or from partners. Additionally, goods can be transferred from one customer to another.

Sold goods may be subject to warranty or return policies if they have been configured accordingly. For more information refer to Applying Warranty Policies and Applying Return Policies

Selling to customers

Physical goods can be sold to customers by creating an invoice (Financial Transaction) and adding the installed items to be sold Goods sold to the customer are invoiced by CRM.COM and the account will be invoiced accordingly.

Physical goods sold by partners are provided to customers through Subscriptions. The system will identify that the physical good belongs to a partner through the warehouse it will be removed from. (i.e. a warehouse that belongs to a partner). Goods sold through partners are not invoiced by CRM.COM.

Selling to partners

Goods  can be sold to partners (in bulk) by creating an invoice (Financial Transaction) and adding the installed items to be sold and the warehouse to be moved at. Goods sold to partners will be transferred to the defined warehouse (if one is defined) of the partner and a warehouse transaction will be created to handle the transfer of the items. The goods are available through the partner’s account’s assets and the account will be invoiced accordingly.

Transferring Ownership of Sold Physical Goods

Sold physical goods can be transferred from their owner Account to a different account without affecting their billing or their warranty. Imported installed items are excluded from the transferring ownership process.  

Renting physical goods

Installed items are rented to the customer through Subscriptions. (Free of charge by default). Rented goods are not invoiced by CRM.COM as the goods are returned to the company when a subscription is canceled.

Returning physical goods

In cases where the physical good was sold and the customer wishes to return it (for any reason) it can be returned through the Accounts Receivable. Physical Goods are returned through the Accounts Receivable using Actions > Manage Assets > RETURN PHYSICAL GOOD’ .

If the installed item was subject to a Return Policy then the amount paid may be refunded. Refer to Return Policies for more information.

In case that the physical good was rented, then the return is done through the 'Remove Installed Item' subscription action. In this case the installed item will be returned to the designated company warehouse as dictated by the 'Warehouse Types Used During Transactions' setup.

Replacing physical goods

Installed Items (either rented or sold) may need to be replaced by new ones either because they are broken or lost. Replacing of goods is possible either through the subscription.

If you would like to replace a good through the subscription then you will need the Swap Installed Item action. It is possible to swap with an item that belongs to a warehouse or an item that is already one of the customer's assets.

In case that the replaced physical good was subject to a warranty then depending on the warranty policy applied, the new installed item may or may not remain under warranty. For more information refer to Applying Warranty Policies

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Applying Warranty Policies

A Warranty Policy is issued by a company in order to assure that a set of physical goods bought by its customers can be repaired or replaced, free of charge, within a specific period after the purchase. A Warranty Policy holds information about the traceable goods or product types or brands or families which can be covered and the period during which the physical goods will be covered after their purchase.

Issuing a warranty for sold goods

Warranties can be issued for traceable physical goods sold to customers based on warranty policies. The process is automatic and takes place when the goods are sold. When a good that is eligible for a warranty is sold, the system determines the warranty policy that should be issued. 

If the good is eligible for more than one warranty policy, the policy with the most recent Valid from Date is applied and has priority over other 'Always Valid' policies.  Only Effective valid Warranty policies are taken into account

You can see whether an installed item is under warranty through the Manage Installed Items Data Entry page in the Warranty Policy section.

Determining the warranty policy applied on replacement

When replacing an item through a job the system determines whether:

• The item is under coverage (will be replaced free of charge).
• The item's warranty policy will be transferred to the new physical good.
• A new warranty policy will be issued for the replacement item.

The system follows the Replacement Under Coverage Policy defined on the selected warranty coverage reason when replacing the item and uses it to determine which policy (if any) will be applied to the item.  Replacement under Coverage Policy has three possible values:

• Carry Over Remaining Duration: The remaining warranty period is calculated and applied to the new item.
• Apply New Warranty: A new warranty policy is issued as if a new traceable physical good was sold.
• No Warranty

 The diagram below displays how the warranty policy on an existing installed item (II) affects the warranty on the new item, during a replacement.  

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Identifying from which warehouse the item will be removed

When a physical good is swapped, the system uses configuration set in Warehouse Types During Transactions and warranty coverage to determine the warehouse that should be used to perform the swap, as displayed in the following diagrams: 

Warehouse transaction movements when the replacement physical good is provided free of charge

Warehouse transaction movements when the replacement physical good is not covered by a warranty

• Coverage reason does not include coverage (i.e. replacement is not free of charge)
• Warranty on existing item has expired
• No Warranty exists

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Applying Return Policies

A Return Policy is issued by the company in order to define its business rules and policies in terms of returning physical goods which were sold to customers. The Return Policy determines when and which purchased physical goods can be returned by the customers and whether the customer is allowed a refund for the returned physical goods or not.

Applying Return Policy on selling physical goods

Return Policies are applied automatically during the sale of a physical good . When a good that is eligible to a return policy is sold, the system determines the return policy that should be issued on the good. If the good is eligible for more than one return policy, the policy with the most recent Valid from Date is applied and has priority over other 'Always Valid' policies. Only Effective valid return policies are taken into account

You can see whether an installed item is under warranty through the Manage Installed Items Data Entry page in the Return Policy section.

Returning a physical good with a return policy

Customers may request to return a physical good for various reasons (e.g., due to a technical issue or to upgrade it or because it was stolen). If the good has a valid return policy which has not expired yet, the system checks whether the return is refundable based on the return coverage reason set by the user. The return date must be equal or before the Warehouse Issue Date + the return allowed period. 

The return of physical goods can be done through Accounts Receivable (Managing Assets action) or Service Requests

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Additional Processes

Measuring usage of installed items

The meter reading of a device is used to measure consumption and therefore might create usage, on which customers can be billed. An example of a device's meter readings are the energy metering devices that are installed in houses and collect electric consumption and homeowners are billed based on their overall usage. A device's meter reading is classified through the Meter Reading Types. These types define how the device is used (what readings are actually measured) by defining its unit of measurement (pound, litre, Kilometre, gallon, etc) 

 To use the meter reading feature

1. Navigate to Configuration / Finance Application / Finance Settings / Set up Product Settings / Meter Reading Types and set up a meter reading type
2. Navigate to Configuration / Finance Application / Finance Settings / Set up Product Settings / Product Types and create a product type of traceable physical good and select the applicable meter reading
3. Navigate to Finance / Product & Pricing / Products / Manage Products Create a product of the specific product type
4. Create an installed item of the specific product
5. Add the installed item to a subscription
6. Use Add Service Usage Subscription action to add and bill the usage done through the specific product.

Internet of Things (IOT) in CRM.COM

Business Flows