Use Order Factor Calculation

The Order Factor for a material represents the number of issue units contained in the order unit. For example, a case of soda contains 24 cans, and so, the order unit would be "1" (a single case), and the number of issue units in the single case is 24 (24 cans in the case), making the Order Factor "24".

By default, in TMS, the Order Factor field is  used for reporting purposes. However, when enabled, the material option Enable Material Receipt Order Factor Calculations gives you the ability to associate a material's vendor and Unit of Measure code with a specific Order Factor, and this value will be used when receiving the material into the warehouse.

Suppose you create a purchase order for five boxes of filters, and because there are five filters per box, you previously associated an Order Factor of 5 to the Unit of Measure code of Box for the material/vendor combination. With this option enabled, when all five boxes are received into the warehouse, the Quantity value that was entered on the purchase order is multiplied by the Order Factor value associated with the Unit Of Measure code. In this example, the Quantity on Hand for the warehouse will show that there are 25 filters (5 boxes X 5 filters in the box) that were added to the inventory.

To fully illustrate how this option works, we will walk you through enabling the option, creating a material and assigning values for a vendor based on the Unit of Measure code, and adding/receiving this material as one of a purchase order's line items. You might not have security permissions to access or change settings on some of the screens we mention in this walk-through. Contact your TMS system administrator for more information.

Material Options

To begin, enable the appropriate material option.

1. Setup > Materials > Options.

2. If you need to enable this option for a Group rather than a Segment, choose Group from the Option drop-down menu and the necessary user group from the Group drop-down menu that appears. Otherwise, make sure that Segment is selected in the Option drop-down menu, and the necessary Segment is selected in the Segment drop-down menu.

3. Under Materials, select the check box next to Enable Material Receipt Order Factor Calculations.

4. Click the Save button.

Create and Format a Material Record

Now that we have the necessary option enabled, we will create a new material, add a vendor to the material record, and associate Order Factor values with the Unit of Measure codes for the material.

1. Materials > Material New.

2. Fill in the required fields.

3. In the Order UOM and Order Factor fields, if these are not specified for a vendor, the values you enter here are the values that will be used on purchase orders, blanket orders, and requisitions. These values will also be used if you generate a purchase order with the Generate PO / Requisition button on the Warehouses tab of the Material Edit screen.

4. Click Save.

5. Click the Vendors tab.

6. In the Vendors area, click the New button.

7. Enter the Vendor code (for example, 3M), or click the Lookup button and query for the vendor to add.

8. In the Unit Cost field, enter the cost of the material when purchased from this vendor.

9. If it is necessary to enter the Catalog number of the material from this vendor, do so in the Catalog field.

10. If this vendor is the Preferred vendor, check the option.

11. Click Save.

12. Now, click the Edit button next to the vendor record on the Purchasing tab.

    You will see that a new area, Unit Order of Measure Factors, has been added to the Edit Vendor dialog box.

13. Click the new button.

    The Material Vendor Factor Editpop-up window opens.

14. Select a Unit of Measure from the drop-down menu.

15. Enter an value in the Order Factor field.

16. Enter a value for the cost in the Unit Cost field.

    The Unit Cost is not the same as the Average Cost of the item. The Average Cost will be calculated by dividing the Unit Cost by the Order Factor.

    For example, if a box of filters costs $81.25, and there are five filters in each box, you would enter cost of a box of filters as the Unit Cost and 5 as the Order Factor. TMS would then calculate $16.25 as the Average Cost of the filter from this vendor.

17. Click Save to associate just this set of values with the vendor.

    Otherwise, click Another and repeat steps 14 - 16 for as many Unit of Measure/Order Factor associates you need for this vendor.

    When you are done adding associations, the associations you might are shown in the Unit Order of Measure Factors grid.

18. Click Save to exit the Edit Vendor dialog box and save the order factor associations you created.

19. Click Save in Material Edit.

20. Click the Warehouses tab.

21. Click New Warehouse.

22. Select a Warehouse from the drop-down menu.

23. Fill in the required fields.

24. Click Save.

25. Click Save again.

    For the purposes of this walk-through, we will not generate a purchase order via the Warehouses tab. We will manually create a purchase order on the Purchase Order New screen.

Create a Purchase Order (PO) with the Material as a Line Item

With our material record completely set up, we will create a new purchase order and add the material as a line item.

1. Purchasing > Purchase Orders > New.

2. In the Ship To field, we will select the warehouse we just added to the material in the steps above.

   Any warehouse selected here must already contain the material you want to add as a line item.

3. Fill in the remaining required fields.

4. In the Vendor field, we will enter the vendor we associated a default Order Factor and Unit Cost with in the steps above.

5. Click Save.

6. Click the Items tab.

7. Click the New Line Item button.

8. In the Item field, enter the Material Number for the material that was created in the last section.

9. Click in the Quantity field.

   The Description field should fill automatically, as well as the Unit Cost, Unit of Measure, and Order Factor fields. These fields are all based on the entries you specified on the Main tab of the Material Edit screen in the steps above.

10. Enter a value in the

11. Select one of the Unit of Measure codes you associated an Order Factor and Unit Cost with.

    The values for these fields should update automatically, along with the Total Cost for the purchase order. Note that the Quantity you specify will be multiplied by the Order Factor when you receive the items into the wa

12. If necessary, change the Issue To drop-down menu and associated value(s).

13. Fill in any of the optional fields as necessary.

14. Click OK.

15. Click the Main tab.

16. Change the Status to Issued.

17. Select an appropriate Sub Status.

18. Click Save.

Receive the Material

Now, we will assume that the line item we added to the purchase order has been shipped to the warehouse, and we will receive and issue it.

1. You should already be in the Purchase Order Edit screen. If not, go to Purchasing > Purchase Orders > Edit, and enter the PO Number from the previous steps.

2. Click the Items tab.

3. Click the line item you added in the previous section and click Receive Item.

4. In the Material Receipt window, verify that all of the fields are correct.

   For this example, we will suppose that quantity that was ordered was the quantity that was received.

5. Click OK.

6. Click Save.

7. Materials > Material Edit.

8. Click the Warehouses tab.

   Notice that the On Hand column for the warehouse on the purchase order in the steps above reflects the quantity you entered when you added the warehouse to the material, plus the amount that was received, which was calculated by multiplying the Quantity that was ordered on the purchase order by the Order Factor.