This article describes kitting from a sales perspective. Another article will be published later that deals with the execution of the kitting and value added services(VAS).

Assembly and Kitting is a great alternative for companies that are not equipped with finished goods warehouse facilities or cannot afford the capital expenditure of setting up a finished goods warehousing facility. Your company can take advantage of the services that are necessary to forward a product to market quickly. Assembly and Kitting support the assembly of products in boxes, shrink wrap, blister, or clamshell packaging.

Some companies require assistance preparing their product for shipment and display. There is a better chance of selling your product if it is accurately packaged and prepared for market. There is nothing worse than excitedly opening a new item just to find that pieces are missing from the package.

An example of how Assembly and Kitting could work:

You have several items that belong together in a package. In an assembly line, each individual in the line subsequently adds another component to the package in a specific order. This ensures that everything is included in the package. At the end of the assembly line, an individual conducts a quality review. Part of that review could include weighing the package. If the weight of the package is accurate, then all the parts have been included; no more no less. If the weight is incorrect even by a couple of ounces, then it means that either a component is missing or there is an additional part.

Assembly and Kitting allows the warehouse to build an order for shipping then distribute or store it. Getting the distribution center to kit your products not only prepares the items for distribution, but may also save your company money, because you do not have the labor costs and capital expenditures to deal with.

Kitting and sales order

One of the requirements is to show the kitting structure in the sales order form in Dynamics AX. Kitting stipulates that there is a hierarchy of items, where only the bottom level is real items that are purchased, stocked and priced, while the upper levels are phantom BOM items. When a customer orders a product, the customer only need to relate to the uppermost BOM-level, while the warehouse workers are picking the actual contents of the kit.

Explosion

Explosion of a phantom BOM items on a sales order is built into the order line processing procedure, the procedure that takes place every time a sales line is inserted, deleted or updated. A parameter field “Kitting” is added to the item table (it is available for BOM and phantom items only). This parameter defines if a BOM item is exploded on sales line processing. Moreover, value added service (VAS) orders is automatically created upon adding such kitted items to the sales order, in order to secure that the items will be packed accordingly. The VAS orders will also ensure that we always have a combined delivery (that we cannot deliver one of the sub-lines, but must deliver the entire kit).

Explosion of BOM item is performed on all BOM levels and all the phantom BOM levels create sales lines marked as a kit, while real items create normal sales lines. The relation between levels for the Kit sales lines is established via a new reference field on sales line. When using the sales order screen, the order looks just like the normal sales order screen:

By clicking on the “Show kit lines”, all lines are shown inside each kit:

The bottom-level sales lines (real stocked items) should be editable only in terms of unit price, line discount amount and multiline discount amount, the rest: quantity, delivery dates, etc. should be derived from the uppermost line. The structure of BOM cannot be manually adjusted: sales lines that are sub levels of the top phantom BOM cannot be deleted manually.

Price and discount calculations

Price amounts and discount amounts are set on the lowest level of BOM only. The price on the upper level is always the sum of the sub lines.

 

Inventory transactions to kits

The final kits do not have inventory transactions. The reason for this is that kits are “virtual items” that do not need a physical picking. It is the sub-components that are picked. Kits are still being packing slip updated and printed on the invoice.

Setting up Assembly and Kitting

This section describes how all the Assembly and Kitting related tables are related to setting up Assembly and Kitting and how they influence the way Assembly and Kitting is processed.

The Kitting form letter setup form

The display of the kitting structure can be shown per item and customer on confirmation, packing slip and invoice. To handle this, a new form Kitting form letter setup is available. This form is following the standard “Table, Group, All” Microsoft Dynamics AX pattern. Here the user can specify if the kitting structure is printed on confirmation, packing slip and invoice for a particular customer.

The form is available under Warehouse Management and Distribution > Setup > Delivery > Kitting form letter setup.

If the Show kitting structure is enabled, the form letter will show the kitting structure as follows:

Assembly and Kitting FAQ

This sections covers information related to Assembly and Kitting, and is described as a FAQ.