How to handle damage item and lost of goods?

ERPNext Stock/Inventory
1

what if is theres a damage item and i need to dispose that item. how to handle that thing in erpnext? and all of my warehouse is under of asset

2

Lost and found items are normally managed in stock reconciliation for inventory [1].

But discard items that are damaged i do not know how you can easily manage it in erpnext.

[1] https://frappe.github.io/erpnext/user/manual/en/setting-up/stock-reconciliation-for-non-serialized-item

3

Hi! @meigallodixital thanks for your response. but do you have any idea how can i lessen all dispose item in my asset?

4

i dont know if stock entry [1] wil be valid in that case. We need wait for an expert :slight_smile:

[1] https://frappe.github.io/erpnext/user/manual/en/stock/stock-entry

5

Sell to an Anonymous customer for ZERO price. Or sell for the price with 100% discount. This should reduce stock and create a loss too your p&l. That’s what it is essentially. A loss to the P&L. A write off.

6

That might be an option, but that way you can not control what happened to the item. Accounting requires that the cost go to a specific account normally, but would be like a normal discount.

For example, if the product is degraded naturally goes to an account, but if the product falls on the floor or is hit it could be applied another, one more for stolen goods …

I’m wondering if it would not be good to create a workflow to manage that or it would be too complicated.

7

It would help if all scenarios are listed

  • Customer reports item not received and you send a replacement
    As suggested above you could send it with 100% discount, there is no revenue gain and your COGs account will take a hit.

  • Damaged goods which you can’t send to customer
    You could send back to supplier or sell at discounted rate

  • Wrong inventory balances
    Stock take should fix this and gain/loss accounts will be affected.

  • Any other

1 Like
8

You can create a warehouse for scrap goods and transfer all the bad material into that. When you do transfer you can change the rate.

9

hello guys thanks for your help.

10

No one can prove if some thing fell down, degraded or just got stolen. it’s just use full for manage ment report to improve the progress of handling or other controls. Useful to track kpi and target warehouse mangers tho improve business waste. It’s not an accounting requirement.

I work for a fortune 500 company. Typically business waste can run into multiple million dollars. For such a sized business people try to track failure modes and root causes. Then mark all business waste to these categories and try to improve using DMAIC / SIX sigma methodologies.

Not needed for all small business if it is a rare occurrence.

Hope this helps.

11

Thanks, i will read about DMAIC / SIX sigma methodologies, appears a interesting thing.

In our case we track this issues because one of our bussines is second hand, and then all products are unique (we haven’t stock, only on dropship products ) and tracked (they pass police controls, and have verifications on buy and on sell, one by one). I give a read to this, thanks again :slight_smile:

12

You are most welcome! Glad it was helpful. :slight_smile:

13

See if this approach makes sense - https://discuss.frappe.io/t/handling-expired-damaged-and-discarded-stock/32098

Basically we are creating Stock entries and setting account as ‘Write Off’ Account.

14

what solutions have u implemented ?