Setting up what you hold

You’ll need: Inventory items, Inventory categories — if you cannot see these, the module may be switched off for your business or outside your permissions. An administrator can change either.

Before a single purchase, decide how each thing you hold is tracked. This is the decision that is cheap now and painful later.

Raw, processed and packaged are different items

The commonest setup mistake in agriculture is one item for a crop that changes state.

Wet beans and dry beans are not the same item. Neither are bulk and bagged, or graded and ungraded. They have different quantities, different values, and one becomes the other through a process you want recorded.

   Cocoa, wet          bought from farmers
   Cocoa, dry          what fermentation and drying produce
   Cocoa, graded 1     what sorting produces

Three items, and the transformations between them are production runs. One item called “Cocoa” cannot express any of that, and your yield and your costs both disappear into it.

Choose lot tracking for anything with an origin

Set the tracking method to lot tracked for crop. That is the level that says which batch — units sharing an identity, rather than one identity per unit.

Then set a shelf life so an expiry is derived when a batch is created, and set the allocation strategy to FEFO — first expired, first out. That is what sends the batch that will turn first, rather than merely the oldest.

→ Full detail in Inventory items and Lots, batches and expiry

Categories carry a purchase treatment

Your inventory category says what buying the thing means: for resale, raw material, consumable or packaging.

For an agricultural business this matters more than usual, because you buy in all four. Crop for resale, crop as raw material for processing, fuel and chemicals as consumables, and sacks and twine as packaging. Setting it deliberately is what keeps your cost of production separate from your running costs.

Units are not decoration

Set the price unit of measurement and mean it. Kilograms, tonnes, bags of a stated weight.

Most agricultural disputes about quantity are really disputes about unit. A price agreed per kilogram and recorded per bag is wrong by a factor nobody notices until reconciliation.

Try it

On staging.feeprime.com, create a wet item and a dry item, both lot tracked, in a raw-material category. That pair is what the processing lesson later needs.