How to Recover Finished Goods Lost Due to Process Loss in ERPNext?

Sales Order is created for 100 Qty of a finished item.

The BOM for this item has 10% Process Loss defined. Due to this process loss, manufacturing 100 Qty results in only 90 Qty of finished goods.

However, the customer requirement is 100 Qty, resulting in a shortfall of 10 Qty.

The requirement is to understand how ERPNext can handle this situation and recover the additional 10 Qty required to fulfill the complete Sales Order quantity of 100 Qty.

Solution: Use Process Loss Item as Scrap

Create a dedicated Process Loss Item and add it to the BOM as a Scrap Item, similar to how ERPNext handles scrap.

For a 100 Qty Sales Order:

Sales Order (100) → Work Order (100) → BOM consumes required raw materials and generates 10 Qty Process Loss Item as Scrap → 100 Qty Finished Goods

This allows the 100 Qty Sales Order to be fulfilled by accounting for the process loss and planning the required additional production/material, instead of treating the lost 10 Qty as part of the customer requirement.