A product that is created automatically when another product (main product) is made.
A by-product in SAP Business One is an item that occurs alongside the main product as part of a production process. It is not primarily manufactured, but is an unavoidable or desired result of production and is recognised as a stock receipt.
1. production analysis
Production analysis: A by-product is defined in SAP Business One as an output within a production bill of materials by defining it with a negative quantity. It is posted to the warehouse stock as part of the main product's completion notification.
2. impact on planning & costs
Impact on planning & costs: The receipt of by-products increases the stock level (OITM/OITW) and, depending on the valuation method (e.g. FIFO), is managed with a corresponding value in the warehouse. The costs of the by-product are deducted from the total costs of the production order, which reduces the effective manufacturing costs of the main product and influences the total variance of the order.
3. operational elaboration
Master Data Requirements:
- Article master data (OITM): The by-product must be created as a regular stock item. For example, the FIFO (First In - First Out) method can be selected for stock valuation.
- Bill of material (BOM): A production bill of materials is defined in the article master of the main product. The by-product is defined here as a component with a negative quantity is entered. This signals to the system that it is an output and not an input.
- Resources: If specific resources or costs are incurred for the creation of the by-product, these can be taken into account via the production bill of materials or directly in the production order.
Transaction Logic:
- Production order (OWOR): A production order for the main product is created and released (
OWOR.statusfrom 'P' for "Planned" to 'R' for "Released"). The production bill of materials that contains the by-product is used. - Output for production (WOR1 / OIGE): The components for the main product are taken from the warehouse. The by-product is not relevant here as it is an output.
- Input from production (WOR1 / OIGN): When the main product is completed and reported back to the warehouse, the "receipt from production" takes place. In this step, the system also automatically posts the by-product to the warehouse, based on the negative quantity in the bill of materials and the quantity of the main product actually reported. This creates a new stock movement.
MRP & Scheduling:
- MRP run: By-products are not planned as requirements in the standard MRP run as they are outputs. However, their availability in the warehouse (OITM.OnHand, OITW.OnHand) can influence the planning of sales orders for the by-product.
- Resource capacity: The production of the main product, which leads to the creation of the by-product, consumes resources (ORSC). The planning of the main product production takes into account the resource capacity and lead time, which indirectly schedules the creation of the by-products.
New in SAP B1 10.0 FP2602: Inventory & Logistics, Production, Banking
ERP for discrete manufacturing - or why screws don't flow
AI for SAP Business One puts the user at the centre
Automated management of production orders
With a focus on production: Versino participates in SMS
