Associating Vendors with Payroll Items Warranty and Repairs Management enables supply Chain management to be one of the most critical, complex & crucial parts of your company operations. But with NetSuite Supply chain management it is easier to manage your supply chain. With any company where your manufacturing & market is widely spread across many locations, you need a singular point where you can manage all your vendors, Suppliers, Partners & distributors to communicate effectively. NetSuite Inventory Management & Supply chain management is the most & best software for your business

With NetSuite supply chain management, you can easily analyze your supply & demand issues, and balance the supply & demand of the current supply chain. Manage your global supply chain with NetSuite supply chain management. Netsuite manages your inventory and supply chain in one place with its vast flexible & scalable features.

 Netsuite inventory management module covers many features as below; 

• Inventory/item record management
• Inventory/Item Pricing
• Inventory Type
• Inventory Measures
• NetSuite Inventory Management Forms
• Manage Stock
• Inventory Level Warnings & access safety stock
• Assessing Stock Levels at locations
• Reallocating Items
• Handling Back-order:
• Understanding and Avoiding Underwater Inventory
• Negative Inventory Validation
• Setting a Location on an Item Record:
• Customizing a Form for Line-item Locations
• Bin Management
• Warranty and Repairs Management
• Vendor Records
• Associating Vendors with Payroll Items
• Importing a Vendor Price List
• Preferred Transaction Delivery on Vendor Records

The basic functionalities inbuilt in NetSuite Supply chain management module are;

• Manufacturing Cost Template
• Manufacturing Routing
• Purchasing and Receiving
• Purchase Requisitions
• Requisitions and Subsidiaries
• Purchase Requests
• Request for Quote
• Purchase Contracts and Blanket Orders
• Purchasing
• Purchasing Inventory
• Purchase Orders
• Bulk Ordering Items
• Bulk Ordering with Demand Planning
• Drop Shipment and Special-Order Purchases
• Receiving Orders
• Receiving Purchase Orders
• Vendor Bill Variances
• Vendor Bills
• Vendor Payments
• Vendor Return Authorization
• Shipping authorize Vendor Returns
• Crediting an authorized Vendor Return
• Applying a Vendor Credit
• Selling and Fulfilling Inventory

Item Record Management

Using Item Records:

Item record management begins with creating item record for all the items you will use on transactions you enter under NetSuite inventory management. There are many Item types available for creating records. Items are the goods and services you sell to customers, and the parts and raw materials you purchase from vendors. They can also include line items on sales and purchase forms, like discounts and miscellaneous charges. On individual item records, you can do the following:

• Restricting Items: You can limit the visibility of items for employees and partners using class, department, location, or subsidiary restrictions.
• Setting up item for the web site: When Setting up item for the web site, determine if an item is available for viewing in a Web site or for purchase in a Web store. Define how each item should be displayed and sold.

• Related information for items: When related information for items, find transactions related to the item. See user notes entered about an item and system notes NetSuite automatically enters to track updates to fields on the item record.

The above image shows related transactions of item.
Item Pricing: 
To set up Item pricing on item records, you can set a single price for each item, or choose to set up many different prices to allow for flexibility. Ways to set different prices include Multiple Pricing, Quantity Pricing, and Pricing Groups.

• Using Multiple Pricing: Enables you to set up different price levels for each item. Setting up multiple price levels enables you to have greater flexibility to set different pricing for different customers. In NetSuite inventory management, you can set up different price levels for each item and service. You can also enter an additional sales price for online items
• Using Quantity Pricing: Lets you automatically apply different sales prices to items that depend on the quantity being sold. This enables you to offer discounts to customers who buy in bulk.
• Pricing Groups: Enable you to assign customer-specific price levels for groups of items. For example, you could create a pricing group called Laptops and associate the pricing group with all of your laptop items.
• Updating Item Prices: When sales prices or purchase prices change, Updating Item Prices and Updating Item Purchase Prices helps you keep records current and have accurate data when you create transactions.
• Swapping Prices between levels: Might be necessary when you want to exchange the prices of two existing price levels
• Item Coupons: To create Item coupons, you can offer coupon codes that apply to specific items when you enable the Promotion Codes feature.

Price List: You can generate a price list document that shows your items and their prices for each customer. Then, you can print, fax or email this price list to send it to your customer. When you print a price list for a customer, the price that shows for items is based on the price level or group identified for that customer.

• Bulk Generating Price List: You can generate price lists for many customers at one time.

• • Generating an Individual Price List: You can generate a price list for one customer at a time.

Item Costing: If you use both the Netsuite Accounting and NetSuite Inventory management features, you need to track the total value of your assets and to calculate the profits you make. You can set up and use your NetSuite account to track inventory costing, which are the costs associated with goods and services you sell.

Costing Methods: The inventory costing method you choose defines the way NetSuite inventory management calculates the cost of items. The costing method you choose determines how inventory costing calculations are handled for costs associated with buying the same item at different purchase prices over a certain period.

NetSuite inventory management module offers these inventory costing methods:

• First-In, First-Out (FIFO) – Using FIFO, the first goods purchased are assumed to be the first goods sold so that the ending inventory consists of the most recently purchased goods. This method is useful to track different shipments of similar products.
• Last-In, First-Out (LIFO) – Using LIFO, the last goods purchased are assumed to be the first goods sold so that the ending inventory consists of the first goods purchased.
  Last-In, First-Out (LIFO) is not available in the NetSuite Australia (AU) edition.
• Average (moving average method) – Inventory costing is calculated as the total units available during a specific date range divided by the beginning inventory cost plus the cost of additions to inventory.
• Standard – Standard costing enables you to track standard costs for items and to track variances between these expected costs and actual costs.
• Group Average – Group average costing enables you to track one average cost for an item across multiple locations within a defined group.

In NetSuite inventory management, average costing is the default inventory costing method. If inventory levels are negative, NetSuite inventory management uses the last purchase price as the inventory costing method.

Multiple Units of Measure: The Multiple Units of Measure feature enables you to define various units used to stock, purchase, and sell inventory items, and track non-monetary accounts. If you are using the feature with inventory items, units of measure provides greater flexibility and accuracy when tracking and selling inventory.

Bar Codes & Item Labels: The Bar Coding and Item Labels feature automatically generates a bar code for each item based on the Item Name/Number, or Stock Keeping Unit (SKU), on the item record. Item bar codes are generated based on the contents of the Item Name/Number field in an item record. Most bar codes use a number or alphanumeric string for this field. Bar codes are also generated for each transaction, as well as serial numbers if you use them. NetSuite’s bar code integration works with any bar code scanner that functions as a keyboard input device. The scanner translates the bar code into the text as if you typed it on the keyboard.

Item Types: When you use the Inventory feature in NetSuite inventory management, you can track and manage the items and services your company buys and sells in the course of doing business.

Item records are created to track a wide range of information in your account, including physical inventory, but also much more:

Some records track the physical items that you manage. These item record types include;

• Inventory Items: NetSuite inventory item records, enable you to track the quantity and value of your inventory. Your balance sheet will automatically reflect the value of your inventory on hand, and your income statement will automatically reflect the markup you charge for these items. If you use the Multi-Location Inventory feature, you can specify locations for each item.

• Serial Numbered Items: Serialized inventory is a means to track the purchase and sale of physical inventory items by assigning a serial number to each item.
• Lot Numbered Items: Lot items track the purchase, stock, and sale of a group or quantity of items by assigning a specific number to the group or quantity.
• Drop Ship Items: When you drop ship an item, the item is sent directly from your vendor to your customer and the item is not processed in your inventory. By going directly to the customer, drop shipments streamline your inventory by keeping a low inventory asset total and reducing the order-to-delivery cycle time.
• Special Order Items: You can use special orders to purchase and track items that might not follow regular inventory processing, such as “just-in-time” orders or orders for customized items.

Non-Inventory Items: Items that you always dropship or other items that you sell or purchase, but do not stock can be recorded and tracked as non-inventory items.

For example, you might use non-inventory items in the following ways:

• Non-inventory for sale – to sell items you custom-create for each order
• Non-inventory for purchase – office supplies you purchase but do not sell
• Non-inventory for resale – drop-ship items that you do not store but you sell directly from the vendor

Other records include items you purchase and sell, but do not manage a physical inventory for. This includes

 

Service Items: A service item is an item you create to track time and record billable hours. Service items are classified as Services for Purchase, Services for Resale, or Services for Sale.

• Services for Purchase – services your business buys but doesn’t sell to customers
• Services for Resale – services your business buys and then sells to customers
• Services for Sale – services your business sells but doesn’t buy

Download Items: You create download item records for files that you want customers to be able to purchase and download in your Web store. Customers are charged per download item as opposed to per item.

Gift Certificates: You can create gift certificate items that allow customers to purchase store credit they can send to someone as a gift. The recipient uses the gift certificate code when placing an order through your Web store or entering a transaction with a sales representative. You can set a preference in NetSuite for how you want to generate the gift certificate codes: you can create them yourself, or use a random hash code automatically generated by the system. Gift certificate codes are not active until the order used to purchase the gift certificate is billed.
Clustering item records are used to assemble or package several items into one unit. These records include

Item Groups: An item group is sold as a single unit but are made up of several individual items. An item group is a short cut for entering a group of items on a sales or purchase order that need to be sold or purchased together. The item group itself is not fulfilled, received or stocked, but rather the components of the group are. However, the item group is available in the item list on a sales or purchase order and can be added to those transactions.

Kit/Package Items: Kits or packages let you create individually sold items that are collected from other items. You can add a description, inventory, non-inventory, other charges, service, kit, gift certificates, and assembly items to your kits or packages. The price of a kit is not dependent on its components’ prices and can be assigned several price levels. You can assign multiple price levels to your kits and make them available on your Web site.

Assembly Items: An assembly item is an inventory item made of several components but identified as a single item. Assemblies are manufactured by combining raw materials you stock.

You create an assembly item record to define the members of an assembly. Then, your account tracks stock separately for the assembly item and for each member component.

Item records can help you with transaction management for selling and purchasing items. These include

Discount Items: You can create discount items to use on sales transactions. When these items are added, discounts are applied to the items being sold. Using discount items enables you to track discount amounts without affecting inventory valuation. You can add discount items as line items, or you can select a discount item in the body of the sales transactions.

Subtotal Items: A subtotal item can be inserted on any line of a transaction and will subtotal the items above it, up to the next subtotal line. This allows you some added flexibility when calculating discounts. If you want to calculate a discount on the entire transaction, you can enter a subtotal line and then enter a discount item after it. Discounts entered above a subtotal line are figured into the subtotal. Discounts entered after the subtotal line apply to the subtotal amount. The subtotal amount itself is not taxed even if the user is calculating taxes on the invoice. The sales tax is still calculated on the individual lines that make up the subtotal. If taxable and nontaxable lines are being added together to create the subtotal, taxes are still calculated only on the taxable line items.

Markup Items: You can use markup items to apply an additional charge to order. Using markup items enables you to track markup amounts without affecting inventory valuation. For example, you can charge a rush fee for completing a service or delivering an item quicker than is usually guaranteed. You can choose to markup the amount for this charge by a flat additional fee.

Payment Items: You can create payment items for types of payments that are made to invoices and should show separately.

Other Charge Item: Used to track purchase or sale charges that do not fit into any of the other categories

• Description Items: Used are used only to add text to purchase and sale transactions, such as special shipping instructions or disclaimers.
• Expense Items: Used are used only to charge tracked project expenses back to customers using the Charged-Based Billing feature.
• Matrix Items: Used to create a matrix of records. An item matrix uses parent item and subitems to track items by options such as size and color. You can create a matrix for inventory, non-inventory, other charge or service items.

NetSuite Inventory Management Features

Your account includes inventory features that enable you to tailor your inventory management to identify, process, and track details most important to your company.

Inventory Management

Managing inventory is one of the most important tasks of running your business. With effective inventory management, you can streamline your stock levels to reduce costs and maximize revenue and profits.

Good inventory management begins with having accurate, accessible information about your inventory.

Features for Inventory and Locations

If you have several locations, choosing to track each location can have a big impact on your inventory management.

NetSuite Inventory Management Forms

There are several inventory transaction forms you can use to manage your stock. Understanding how each form functions helps you determine which inventory transactions dated prior to an inventory distribution as it can cause difficulties in maintaining accurate inventory data. To help you differentiate between inventory forms form best suits your needs to track and process your inventory to achieve your inventory management goals. Warning When entering any inventory form, you should not delete or change

Inventory Level Warnings & access safety stock

Assessing Stock Levels at locations

Reallocating Items

When back-ordered goods are received from your vendors the inventory generated from assembly work orders is automatically allocated.

Handling Back-order:

If an item is entered on a sales transaction, but the item is not in stock, your account tracks the item as a backorder

Understanding and Avoiding Underwater Inventory

Consider the following scenario where inventory is sold underwater: On March 30, an invoice is entered that sells 100 widgets and brings the on-hand count of widgets to -100 widgets sale transactions. These cost calculations from underwater sales can lead to skewed results for reports and inventory data. During the time that the on-hand count is below zero, on Understanding and Avoiding Underwater Inventory. Selling an item when the data shows that you do not have the item in stock is known as an “underwater” sale. Inventory is in

Negative Inventory Validation

Negative inventory validation: The Enhanced Validations and Defaulting SuiteApp displays inventory warnings for negative inventory.

Inventory status checked before commitment

Setting a Location on an Item Record:

To associate an inventory item with a location:

Setting a Location on an Item record, when you identify a preferred location on each item record, your account remembers the location you prefer when the item is present. Specify the Preferred Location for pulling the item from NetSuite inventory. After you identify a preferred location on each item record, the preferred location of the item appears.

Customizing a Form for Line-item Locations

We can select a location for each line on a transaction. Important point is, you must customize a transaction form to show locations on each line. After you identify a preferred location on each item record, the preferred location of the item defaults on transactions that show line-item locations.

Bin Management

You can use bin management to identify places in your warehouse where you store inventory items. Bins help you track on-hand quantities within a warehouse also knows exactly what items need to be put away, or stocked, and where, after they are received from vendors.

 

Warranty and Repairs Management, enables you to register item warranties and process warranty-related claims. Claims that you receive are automatically validated against warranty terms, which helps reduce claims processing turnaround time.

Warranty and Repairs Management provides the following features:

Multiple ways to register a warranty

1. Registration generated from an invoice (autogenerated registration) – Register a warranty for supported item types after invoice creation.
2. Manual registration – Create a standalone warranty registration.
3. Import of warranty registration details – Import registration details from a CSV file, through the scheduled script or web service.

Warranty tracking on the item record – Set up default warranty information on item records.

Warranty claims validation and processing

1. Create a claim from a warranty registration.
2. Validate claims against existing warranty registration information to ensure that only valid claims are processed for the refund, repair, or replacement of the warranty item.
3. Create a return authorization for warranty items from the claim record.
4. Create a credit memo or sales order for claims from the return authorization record.

Vendor Records

A vendor is a company or person from whom you purchase goods and services.

For each vendor you purchase from, use vendor records in NetSuite supply chain management to do the following:

• Track associated items and pricing
• Track addresses for a vendor’s locations and offices
• Track financial data and purchasing transactions
• Track CRM information like contacts, notes, messages, and marketing campaigns
• Attach and track files
• Give online access to enable vendors to see your orders

 

Associating Vendors with Payroll Items
In NetSuite, you can set up payroll items and associate that item with a payroll vendor to simplify the withholding and payment of payroll liabilities.

Importing a Vendor Price List

On the Financial subtab of a Vendor record, under the Items subtab, you can list items available from that vendor and specify the vendor codes and prices for that item.

If you use the Multiple Currencies feature, you can import prices for an individual item in multiple currencies.

Preferred Transaction Delivery on Vendor Records

Because each vendor can have an individual preference for how to receive transactions, you can set a preferred transaction delivery method on their record as the default way to deliver transactions to them.

On each vendor’s record, define their preferred way to receive transactions: by regular mail (printing), by email, by fax, or by a combination of the three.
 Then, the preferred delivery method for the vendor is marked by default in the following situations:
● on transactions when you select that vendor
● on transactions created from that vendor record
● on transactions that are copied or converted from a transaction that uses these settings

Supply chain management & its benefits

Purchasing and Receiving
Purchasing and Receiving includes Requisitions includes:
● Purchase Requisitions
● Request for Quote
● Purchase Contracts and Blanket Orders
● Purchasing
● Receiving Orders
● Expenses
● Procurement Dashboard
● Standard Workbooks

Purchase Requisitions

When your company needs to make a purchase, the Requisitions feature can help you track pertinent information, such as the following:

• Who needs the item?
• What exactly is the item that is needed?
• When is the item needed?
• How much do we expect to spend for the item?
• Who has approved the expenditure for the item?

A requester can enter a new requisition to initiate a purchase even if they do not know the exact price or vendor name. This information can be added later in the process.

After the requisition is completed and approved, the buyer can place orders with vendors for materials on requisitions. A buyer can order requisitions individually or set up automatic purchasing using preferred vendors and pricing.

Because one requisition can include multiple items with no vendor specified, a single requisition might result in the creation of one or more purchase orders from one or more vendors.

Both Purchase Requests and Requisitions can be enabled concurrently in your account if you choose.

Requisitions and Subsidiaries

In NetSuite OneWorld accounts, you can associate a subsidiary on a requisition. You can select your subsidiary or the subsidiary associated with your role. After you select a subsidiary, then item and location restrictions based on your role will apply.

A requisition can be associated with only one subsidiary. To change the subsidiary associated with a requisition you have entered, all linked orders on all requisition lines must first be removed.

Purchase Requests

A purchase request is a transaction that records a purchase that needs to be made. The request details the item needed and the anticipated price of the item. After the purchase request needs to become an actual purchase, the request must be converted into a purchase order.

Employees with access to purchase requests can enter requests to purchase items, material or services from vendors.

A purchase request might require approval by a supervisor or approver before it is turned into a purchase order if the Approval Routing feature is enabled.

Request for Quote

A Request for Quote (RFQ) is a request you send to one or more vendors asking them to provide specifics about their pricing, terms, and conditions regarding a purchase contract for a product they provide. Usually, the pricing request is tiered, which means that as you purchase larger quantities of an item, the price per individual unit goes down.

Set up the RFQ to define the item, pricing tiers and other information you need, as well as an open and close date to define the bidding period. Then, send the RFQ to all vendors you would like to submit a quote. The vendors can access the RFQ to define and submit their pricing, terms, conditions and other details of their quote.

After all the vendors have submitted a quote, your buyer can analyze the submissions to determine the best overall deal from the quotes provided. After analysis, your buyer can mark which items are to be purchased from which vendors. After selecting the best vendor for each item, the buyer can create purchase orders or can create purchase contracts for future purposes. A buyer can create one or multiple purchase contracts from a single RFQ.

Purchase Contracts and Blanket Orders

The Purchase Contracts feature enables purchasing managers and buyers to use contracted terms, pricing, and delivery schedules when purchasing materials for a company.

The Blanket Orders feature can improve buyer efficiency and accuracy and potentially reduce procurement spending. Blanket purchase orders define a predetermined price for a set quantity of items you will buy from a vendor during a time period. The blanket purchase order specifies the item, price, quantity, terms and effective time period.

Purchasing

Tracking your purchases is an important step in maintaining your inventory. By knowing what you have on order, how many and when it will be received, you can keep your inventory at an optimum level.

NetSuite can help you create purchase orders for the appropriate items and quantities and help track special orders and drop ship orders as well.
Purchasing Inventory
Create purchase orders to get items and materials you need for replenishing stock and selling to customers. By entering a purchase order, you initiate the purchase and record all aspects of the purchase:

• when the items are ordered
• which items are ordered
• what quantity is ordered
• which vendor items are ordered from
• when the items are expected
• where the items will ship
• which items have been received from the vendor

Knowing this information about your purchases helps you keep your stock streamlined.

You can create purchase orders individually or use the bulk item ordering function to create purchase orders for items that are needed. Bulk item ordering is ideal because it takes the guesswork out of how much you need and when to order it.

After you enter orders for items, you can view the quantity on order on item records and reports.

Purchase Orders

Set up the RFQ to define the item, pricing tiers and other information you need, as well as an open and close date to define the bidding period. Then, send the RFQ to all vendors you would like to submit a quote. The vendors can access the RFQ to define and submit their pricing, terms, conditions and other details of their quote.

After all the vendors have submitted a quote, your buyer can analyze the submissions to determine the best overall deal from the quotes provided. After analysis, your buyer can mark which items are to be purchased from which vendors. After selecting the best vendor for each item, the buyer can create purchase orders or can create purchase contracts for future purposes. A buyer can create one or multiple purchase contracts from a single RFQ.

Purchase Contracts and Blanket Orders

The Purchase Contracts feature enables purchasing managers and buyers to use contracted terms, pricing, and delivery schedules when purchasing materials for a company.

The Blanket Orders feature can improve buyer efficiency and accuracy and potentially reduce procurement spending. Blanket purchase orders define a predetermined price for a set quantity of items you will buy from a vendor during a time period. The blanket purchase order specifies the item, price, quantity, terms and effective time period.

Purchasing

Tracking your purchases is an important step in maintaining your inventory. By knowing what you have on order, how many and when it will be received, you can keep your inventory at an optimum level.

NetSuite can help you create purchase orders for the appropriate items and quantities and help track special orders and drop ship orders as well.
Purchasing Inventory
Create purchase orders to get items and materials you need for replenishing stock and selling to customers. By entering a purchase order, you initiate the purchase and record all aspects of the purchase:

• when the items are ordered
• which items are ordered
• what quantity is ordered
• which vendor items are ordered from
• when the items are expected
• where the items will ship
• which items have been received from the vendor

Knowing this information about your purchases helps you keep your stock streamlined.

You can create purchase orders individually or use bulk item ordering function to create purchase orders for items that are needed. Bulk item ordering is ideal because it takes the guesswork out of how much you need and when to order it.

After you enter orders for items, you can view the quantity on order on item records and reports.

Purchase Orders

Purchase orders authorize vendors to provide items, materials or services to your company. When you enter purchase orders, you can track items that you expect to receive, items you do receive, and items yet to be received. A purchase order expresses a commitment to receive and pay for goods and services. You can create purchase orders individually or in bulk. After a purchase order is recorded you can track the items as they are received.

Bulk Ordering Items

You can create purchase orders in bulk for items you need to restock. The Order Items page lists items that NetSuite determines are in need of being replenished. In this way, bulk item ordering helps automate your replenishment process and keep your inventory at an optimum level.

To use bulk item orders, you can add items to the list by using either the Demand Planning feature or the Advanced Inventory Management feature.
Bulk Ordering with Demand Planning
When you use the Demand Planning feature, item orders are generated using demand plans and supply chain plans that incorporate historical demand and expected future orders. Supply chain management plans determine when items are ordered and in what quantity. After a supply chain management plan is reviewed, the orders can be generated using the Order Items page.

Drop Shipment and Special-Order Purchases

You can use the Drop Shipments and Special Orders feature to create purchase orders for items. When a sales order is approved that contains a drop-ship or a special-order item, a purchase order is automatically created for the item.

Drop shipments and special-order items are purchases that are not processed the same way as other items that you purchase:

• When you drop ship an item, the item is sent directly from your vendor to your customer and the item is not processed in your inventory.
• You can use special orders to purchase and track items that might not follow regular inventory processing, such as “just-in-time” orders or orders for customized items.

Items are identified as a drop shipment or a special order when the sales order is created.

Receiving Orders

Items can arrive at your warehouse for several reasons:

• Vendors send items you have ordered.
• Customers send items you have authorized to be returned.
• Other company locations send items to transfer to your location.

Purchase order items are received from vendors and suppliers. Transfer order items are received from your company’s various locations. Return authorization items are received as returns from customers.

As these items arrive at your business, you need to match the items against open purchase orders. transfer orders or return authorizations. This process is called receiving.

When you receive items at your location, those items need to be recorded in your inventory. It is important to track the items you receive because it affects your stock levels, accounting records, and item commitment.

When you receive an order, NetSuite does the following:

• Updates item stock levels and tracks how much is still on order
• Updates the total asset value of your inventory
• Allocates items to existing sales commitments and backorders.

When a shipment arrives, you receive items against an open order to specify that some or all items on the order are received. If you enter an item receipt to specify exactly what you have received, you can track which items have already arrived and which items are still expected to arrive.

How you receive items depends on whether you use the Advanced Receiving feature.

• If you do not use Advanced Receiving, the receiving and billing processes are combined. When you receive an item, you create a vendor bill for it simultaneously.
• If you prefer separate processes to receive items and create vendor bills, you can use the Advanced Receiving feature.
  With Advanced Receiving, you can use separate processes to receive items separately from billing items. Then, you can receive parts of an order before creating a bill for the whole order.
• If you use return authorizations, you can also receive authorized returns in parts using Advanced Receiving and the Item Receipt page.

Receiving Purchase Orders
When receiving purchase orders, you need to receive the items and create a bill for them.

• Receiving a purchase order indicates you have received items you ordered from a vendor and added them to your inventory.
• Billing a purchase order creates a vendor bill for the amount you owe for the products received.

Vendor Bill Variances
When you use the Advanced Receiving feature, purchase order items you receive can be matched to the corresponding vendor bill to check for variances in quantities and rates.

Vendor Bills

Track your payables by entering bills as they arrive from vendors and pay them from the payables list as they are due. Then, you have an accurate picture of your payables at any point during the billing cycle.

Entering a vendor bill includes feeding the primary information of the vendor like account, amount, date, etc.

Vendor Payments

After you have entered vendor bills, you pay them when they are due. By recording the bill payment in NetSuite, the payment posts to the general ledger as an expense and the amount of the payment is deducted from your accounts payable total. This helps you track expenditures and total payables due. Record a bill payment by doing one of the following:

• To pay a single vendor, click Pay Single Vendor.
• To pay bills for several vendors, click Pay Bills.

Credits are negative numbers from past payment adjustments and payments are positive numbers. If the two are combined and the sum of all payments is a negative number, an error message will indicate that a payment cannot be processed for a negative amount. Use the Write Checks transaction to pay vendor bills only if you do not use Accounts Payable. If you use Accounts Payable, use the Pay Bills function.

You can check the payment status and print the bills.

Vendor Return Authorization

When you track vendor returns using authorizations, you know the status of each return and you can track accurate information about each return you process. The vendor return workflow includes obtaining Return Materials Authorization (RMA) from the vendor, then processing the return in NetSuite to track information about each return.

The vendor return process:

1. Entering the authorization – records information about the return, such as the item number and description, quantity being returned, the value of the return and the vendor RMA number
2. Approving the authorization – approves the return of the item to the vendor
3. Shipping the return – verifies that the item has been shipped to the vendor
4. Crediting the return – logs a refund or credit from the vendor for the returned item

Using return authorizations also gives your shipping department the information they need to match items to vendor return forms as they send shipments. Then, your accounting department knows what is expected from each vendor, such as a credit, refund, or replacement item.

When you want to return an item to a vendor, complete the information on a vendor return authorization form including the following:

• The item to be returned
• The quantity of each item being returned
• The amount to be credited or refunded to you upon return of the item

A vendor return authorization is a non-posting record of an item you intend to ship back to the vendor it was purchased from. Each vendor return authorization you enter is assigned a unique return number that enables you to track the entire return process.

This is considered a purchase transaction and is non-posting.

Shipping authorize Vendor Returns

When you ship items to a vendor for an authorized return, mark the item as shipped to track the progress of the order through the return process.

Fill all the details about the returned item. Now, the items on the vendor return authorization are marked returned and your inventory is automatically updated with the items that have been shipped.

Crediting an authorized Vendor Return

After a vendor return has been approved, enter a vendor credit, or bill credit, for the amount of the returned items. This enables you to track credit owed to you by a vendor so you can apply the credit to vendor bills.

If you use the Advanced Shipping feature, you can enter a bill credit for the amount of the item before you ship it. If you do not use the Advanced Shipping feature, you credit items only as you ship them and entering a vendor credit both returns and credits the item.

A vendor credit is a transaction to show credit from a vendor that you can apply to your payables account. Vendors might credit your account if you return merchandise to them or negotiate a discount after receiving an invoice.

You can apply vendor credits to vendor bills when you make payments and the credit decreases the payable amount due to the vendor.

There are 3 ways you can credit the vendor-

1. Entering a Vendor Credit Manually
2. Creating a Vendor Credit Directly from a Vendor Bill
3. Creating a Vendor Credit Directly from a Vendor Return

Applying for a Vendor Credit
You can apply vendor credits to decrease the amount owed to a vendor. When you apply a vendor credit against an open bill, the amount of the credit is deducted from the total amount of the bill.

You can apply a vendor credit to a bill on the credit transaction or on a payment transaction.

Selling and Fulfilling Inventory:

When a customer commits to buying an item, you record it as a sales transaction. When you physically take the item out of inventory and ship it to the customer, you record it as a fulfillment. Selling and fulfilling items from your inventory affect your stock levels, accounting records, and item commitment. This effects fulfillment functions to be examined include using the Pick, Pack, and Ship feature, handling back-orders, reallocating items and closing line-items manually. To learn more, see the following links: Selling Inventory Fulfilling Inventory

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