FW: Serialized Inventory OR Fixed Asset

[David Garrett]

1st Issue ...
 
As I have mentioned, I am selling a Care device for the elderly. It requires
configuration and may in the future need to be maintained via a service call
and the configuration altered.
 
The device initially will not be sold but installed with a recurring service
fee, in the future direct sales may be made.
 
A direct analogy is selling a managed router which has been configured prior
to shipping and may in the future require a service call to update
configuration. In most cases the router remains the property of the service
provider.
 
I see 2 competing implementations
 
Serialized Inventory
==============
Pros
* seems to fit best with the order and shipping process
* We would capture the initial configuration details as the cart order is
finalized.
* We would further provide checks to ensure that shipping is not possible
prior to confirming that the serialized inventory item has beed configured
and tested prior to shipping.
* the configuration would be held in an entity such as CareDevice and a new
entity field InventoryItem.careDeviceId
 
Cons
* I am not sure how to deal with future service calls, configuration updates
and maintenance management
 
Question?
Is there anything in place to manage post sale maintenance??
 
Fixed Asset
=========
Pro
* seems to model what we are actually doing better.
* my assumption is that the Fixed Asset is planned to have some longevity
after the sale
 
Cons
* I don't think it fits well with the shopping cart and order process. Only
"sale" of assets I can think of is in the travel system. How would this
work?
 
 
Core Issue
========
When I make the sale should we sell an inventory Item or sell a service and
deliver a configured fixed asset(if so how).
 
Thanks
David G
 

[Jim Barrows]

On 5/8/07, David Garrett <[hidden email]> wrote:

> 1st Issue ...
>
> As I have mentioned, I am selling a Care device for the elderly. It requires
> configuration and may in the future need to be maintained via a service call
> and the configuration altered.
>
> The device initially will not be sold but installed with a recurring service
> fee, in the future direct sales may be made.
>
> A direct analogy is selling a managed router which has been configured prior
> to shipping and may in the future require a service call to update
> configuration. In most cases the router remains the property of the service
> provider.
>
> I see 2 competing implementations

You should be asking a CPA or other Accounting Professional this
question.  It doesn't really matter which way you go in ofbiz, or any
other ERP/Accounting system, since the route is determined by what you
can via GAAP, local, state and federal regulations as well as the
various tax concerns each might have.  None of these questions can be
answered here in this forum.

If you are asking "How do I track service calls on devices?"  That's a
completely different question from is my device an asset, or
inventory.

>
> Serialized Inventory
> ==============
> Pros
> * seems to fit best with the order and shipping process
> * We would capture the initial configuration details as the cart order is
> finalized.
> * We would further provide checks to ensure that shipping is not possible
> prior to confirming that the serialized inventory item has beed configured
> and tested prior to shipping.
> * the configuration would be held in an entity such as CareDevice and a new
> entity field InventoryItem.careDeviceId
>
> Cons
> * I am not sure how to deal with future service calls, configuration updates
> and maintenance management
>
> Question?
> Is there anything in place to manage post sale maintenance??
>
> Fixed Asset
> =========
> Pro
> * seems to model what we are actually doing better.
> * my assumption is that the Fixed Asset is planned to have some longevity
> after the sale
>
> Cons
> * I don't think it fits well with the shopping cart and order process. Only
> "sale" of assets I can think of is in the travel system. How would this
> work?
>
>
> Core Issue
> ========
> When I make the sale should we sell an inventory Item or sell a service and
> deliver a configured fixed asset(if so how).
>
> Thanks
> David G
>
>

--
James A Barrows

[hans_bakker]

Hi David,

Perhaps some additional thoughts.

Concerning the Care device itself, if it is still owned by you and you have to
do maintenance on it and if you also have depreciation then it should be a
fixed asset. If this is not important or you do not want to record this then
do not use fixed asset. With the fixed asset you can use the rental features.

If you like to combine several products in another product then aggregate
products could be a solution, the product then consist of the care device
itself you have in inventory and the subscription which was introduced
recently. Then you can add a another product to it which is the configuration
service.

Then it is also possible (with some changes in the system) to combine the
possibilities of above, having a (serialized) product which you can ship
normally but which is still connected to a fixed asset where you can do
maintenance and rental.

To select the implementation which is the best needs more investigation and
trial with example products.

Regards,
Hans Bakker
http://Antwebsystems.com: Quality OFBiz support with competitive rates.


On Tuesday 08 May 2007 20:21, David Garrett wrote:

> 1st Issue ...
>
> As I have mentioned, I am selling a Care device for the elderly. It
> requires configuration and may in the future need to be maintained via a
> service call and the configuration altered.
>
> The device initially will not be sold but installed with a recurring
> service fee, in the future direct sales may be made.
>
> A direct analogy is selling a managed router which has been configured
> prior to shipping and may in the future require a service call to update
> configuration. In most cases the router remains the property of the service
> provider.
>
> I see 2 competing implementations
>
> Serialized Inventory
> ==============
> Pros
> * seems to fit best with the order and shipping process
> * We would capture the initial configuration details as the cart order is
> finalized.
> * We would further provide checks to ensure that shipping is not possible
> prior to confirming that the serialized inventory item has beed configured
> and tested prior to shipping.
> * the configuration would be held in an entity such as CareDevice and a new
> entity field InventoryItem.careDeviceId
>
> Cons
> * I am not sure how to deal with future service calls, configuration
> updates and maintenance management
>
> Question?
> Is there anything in place to manage post sale maintenance??
>
> Fixed Asset
> =========
> Pro
> * seems to model what we are actually doing better.
> * my assumption is that the Fixed Asset is planned to have some longevity
> after the sale
>
> Cons
> * I don't think it fits well with the shopping cart and order process. Only
> "sale" of assets I can think of is in the travel system. How would this
> work?
>
>
> Core Issue
> ========
> When I make the sale should we sell an inventory Item or sell a service and
> deliver a configured fixed asset(if so how).
>
> Thanks
> David G

[David Garrett]

Hans,

This seems to be a great suggestion (as I have communicated seperately).
Thankyou ... A very clear useful suggestion.

I feel a solution for me based on serialised inventory and subscription has
some real value.

I have run into a subscription problem for which I will create another
thread.

David G

-----Original Message-----
From: Hans Bakker [mailto:[hidden email]]
Sent: Wednesday, 9 May 2007 6:31 PM
To: [hidden email]
Subject: Re: FW: Serialized Inventory OR Fixed Asset

Hi David,

Perhaps some additional thoughts.

Concerning the Care device itself, if it is still owned by you and you have
to do maintenance on it and if you also have depreciation then it should be
a fixed asset. If this is not important or you do not want to record this
then do not use fixed asset. With the fixed asset you can use the rental
features.

If you like to combine several products in another product then aggregate
products could be a solution, the product then consist of the care device
itself you have in inventory and the subscription which was introduced
recently. Then you can add a another product to it which is the
configuration service.

Then it is also possible (with some changes in the system) to combine the
possibilities of above, having a (serialized) product which you can ship
normally but which is still connected to a fixed asset where you can do
maintenance and rental.

To select the implementation which is the best needs more investigation and
trial with example products.

Regards,
Hans Bakker
http://Antwebsystems.com: Quality OFBiz support with competitive rates.


On Tuesday 08 May 2007 20:21, David Garrett wrote:

> 1st Issue ...
>
> As I have mentioned, I am selling a Care device for the elderly. It
> requires configuration and may in the future need to be maintained via
> a service call and the configuration altered.
>
> The device initially will not be sold but installed with a recurring
> service fee, in the future direct sales may be made.
>
> A direct analogy is selling a managed router which has been configured
> prior to shipping and may in the future require a service call to
> update configuration. In most cases the router remains the property of
> the service provider.
>
> I see 2 competing implementations
>
> Serialized Inventory
> ==============
> Pros
> * seems to fit best with the order and shipping process
> * We would capture the initial configuration details as the cart order
> is finalized.
> * We would further provide checks to ensure that shipping is not
> possible prior to confirming that the serialized inventory item has
> beed configured and tested prior to shipping.
> * the configuration would be held in an entity such as CareDevice and
> a new entity field InventoryItem.careDeviceId
>
> Cons
> * I am not sure how to deal with future service calls, configuration
> updates and maintenance management
>
> Question?
> Is there anything in place to manage post sale maintenance??
>
> Fixed Asset
> =========
> Pro
> * seems to model what we are actually doing better.
> * my assumption is that the Fixed Asset is planned to have some
> longevity after the sale
>
> Cons
> * I don't think it fits well with the shopping cart and order process.
> Only "sale" of assets I can think of is in the travel system. How
> would this work?
>
>
> Core Issue
> ========
> When I make the sale should we sell an inventory Item or sell a
> service and deliver a configured fixed asset(if so how).
>
> Thanks
> David G