Setting up the System for Consigned Purchases in Inventory Management

Setting up the system for consignment is a multistep process that you perform in both PeopleSoft Payables and Inventory.

To set up consignment inventory:

1. Establish consignment suppliers and locations in PeopleSoft Payables.

   Use the Supplier Information - Location - Procurement Options page to indicate which suppliers supply the business with consigned items. For each consignment supplier, determine whether to create vouchers automatically, stage them as pending transactions, or create them manually when consigned items are consumed.

2. Establish default consignment parameters for items in the setID.

   On the Define Item - General: Common page, designate the item as consigned (and, by definition, non-owned). The selection that you make here is for default purposes only; you can override it for individual business units on the Define Business Unit Item - General: Common page.

3. Establish consignment parameters for items in the business unit.

   On the Inventory Definition - Business Unit Definition page, select an accounts payable (AP) business unit for use when the AP information is not available on a PeopleSoft Purchasing receipt. PeopleSoft uses this business unit to retrieve the correct setID for the supplier location when you designate an item as consigned on the Define Business Unit Item - General page.

   On the Define Business Unit Item - General page, designate the item as consigned in the business unit and assign a supplier and supplier location to supply the item. Only one supplier-location combination can supply the item for this business unit; once you have made the supplier assignment, you cannot change it if stock exists in a non-owned storage location or if the item has been staged for putaway.

4. Establish material movement rules for consigned items in the business unit.

   On the Inventory Definition - Business Unit Definition page, indicate whether the business unit allows the transfer of consigned items from non-owned to owned storage locations. This option enables you to give the item an owned status while it is still stocked in your warehouse.

   Note: Transferring a consigned item to an owned storage location qualifies as a consumption transaction. At this point, the item becomes an owned item.

5. Establish storage locations for consigned items.

   Define the storage locations in which you plan to stock consigned items as non-owned locations. Default putaway locations set up for non-owned items are eligible for storing consigned stock.