Item Costing is a powerful feature in the Operations Module of Restaurant365. This document gives a high level of each type of record you must create / update in order to use the many functions within Item Costing.
These five records must be created and used in order to start using Item Costing in the Operations Module. Click each link to learn more about each record type:
Create your Inventory Vendors
Complete all the required fields on the Vendor record as outlined on the Vendor record article.
Vendor Entry Type
Your Inventory Vendors will need a specific setting updated in order to be used with Items in R365. On the Vendor record, navigate to the 'Vendor Additional Info' tab and locate the drop-down field labeled 'Entry'. This field can be set by one of two ways:
- ‘by Account’ - This is the default value and will display the 'Account Grid' on the AP Invoice. This should be used for Vendors that are not invoiced by Item, but are invoiced to specific GL Accounts (by Account)
‘by Item’ - This is the secondary option and should be used for Vendors that are invoiced by Item. When selected, the 'Items Grid' will appear on the AP Invoice
Ensure that each Inventory Vendor has the 'Entry' type set to 'by Item' and complete the Vendor creation process.
Create Inventory & Purchasing Units of Measure
The next step after creating your Vendors is to create the U of Ms that will be used with your Inventory Items. There are various uses for U of Ms in the R365 Operations Module:
- Inventory U of M - How you count or report on an Item
- Purchase U of M - How you receive an Item
- Yield U of M - How much an Item will Yield in a Recipe
- Portion U of M - How much is in a single Portion in a Recipe
To manually create a U of M, hover over the 'Item' menu, then the 'Setup' sub-menu and select 'New U of M'. A blank U of M record will open in a new tab.
- Base for this type = OZ-fl
- Examples: OZ-fl, cup, gal, quart
- Base for this type = OZ-wt
- Examples: OZ-wt, lb, kg
- Base for this type is Each
- Examples: Each, Avocado
The system comes with a pre-set list of standard Units of Measure. If the desired U of M is not in the list then create a new one and set the following fields.
1) Name - This name will display when selecting the U of M on a transaction or while viewing reports. This is the only required field if 'Item Costing' is not selected on Preferences
2) Equiv U of M - To create a new U of M, it must have an Equivalent U of M that already exists in the system. As OZ-wt, OZ-fl, and Each are Base U of M, many of your U of Ms will be equated back to one of these three. You can equate U of Ms to other U of Ms you have created. For example: Name = 'Case - 4/750 ML', Equiv U of M = 'Bottle - 750 ML', Equivalent Qty = '4'. As 'Bottle - 750 ML' would have already been created and equated back to OZ-fl, the system can calculate how many OZ-fl there are in our new U of M 'Case - 4/750 ML'. For more information on U of M Equivalence, see the training on U of M Equivalence
4) Container - Optional text field to designate container type, such as box, case, sack, etc.
5) Packsize Descrip - Optional text field to describe pack size
6) Purchase - This checkbox will determine whether the unit of measure will appear on the AP Invoice as a possible unit for purchases. The other 2 fields are associated with U of M Equivalence:
- Note: The Equivalence helps the system determine how a U of M relates to another. To set this up, specify an Equivalent U of M and Equivalent Qty.
Equivalent U of M = OZ-fl Equivalent Qty = 8
The next step after creating your U of Ms is to create the Items that will use the U of Ms. There are three types of Items in the R365 Operations Module:
- Purchased Item - The main Item record that represents the Inventory purchased from your Vendors and counted on Stock Counts
- Recipe Item - The Recipes that are prepared at your Restaurants. These Items are made up of Purchased Items and other Recipe Items and can be Mapped directly to the Menu Items that are imported from your POS System. Click here to learn more about Recipe Costing in R365
- Sales Item - The Items that are sold to AR Customers on the AR Invoice
For the purpose of this training article, the process for creating Purchased Items will be explained here. Review the training articles for Recipe Items and Sales Items to learn how to create them in R365.
Purchased Item records can be created via the Import Tool or Manually. To manually create a Purchased Item, hover over the 'Item' menu on the top ribbon and then the 'Setup' sub-menu and select 'New Purchased Item'. A blank Purchased Item record will open in a new tab.
1) Name - Enter the Name for the Purchased Item as it will appear throughout R365. Purchased Item Names should be unique, but it is not required
2) Type - This value is read-only and cannot be modified. It identifies the Item as a Purchased Item
3) Measure Type - This will identify the manner in which this item is measured throughout the system (Vendor Items, Item Locations, Recipe, and Inventory Transactions). Once set, Units of Measure can then be assigned. Ensure that the Measure Type is entered correctly because once the Item record is saved, the Measure Type will be locked and unchangeable. These types include:
- Note: To connect different Measure Types, you must set an equivalency since equivalencies will not be automatically created
4) Number (optional) - Enter a Number value for the Purchased Item. This value can be useful for filtering and sorting purposed in the 'Items' list. All alphanumeric characters are accepted in this field
5) Description - Enter a description for the Purchased Item. Similar to 'Number', this value is available on the 'Items' list
6) Active Checkbox - This box is checked by Default and indicates that this Purchased Item is Active in R365 and can be selected on AP Invoices, and counted on Stock Counts. When an Item is discontinued, uncheck this box to remove the Item from Item Selectors throughout R365
7) Actual as Theoretical Checkbox - Check this box to us the Actual Usage for this Item in place of the Theoretical Usage (via Recipes mapped to Menu Items) on the AvT Report
8) Commissary Item Checkbox - Check this box if this Purchased Item will also be available for ordering on a Commissary Order in the Commissary Feature. When Checked, the 'Sales' tab will appear on the Purchased Item record. Click here for more information on how to setup Purchased Items as Commissary Items
9) Available in AR Invoice - Check this box if this Purchased Item will also be available as a Sales Item on the AR Invoice. When Checked, the 'Sales' tab will appear on the Purchased Item record. Click here for more information on how to setup Purchased Items as Sales Items
10) Catering Item Checkbox - Check this box if this Purchased Item will also be available for sale on Catering Menus in the Catering Module. When checked, the 'Catering' tab will appear on the Purchased Item record. Click here for more information on how to setup Purchased Items as Catering Items
11) Select Recipe Image Button - This button is not applicable to Purchased Items and is only used on Recipe Items
12) Upload File Button - Attach a file to the Purchased Item record using this button
Inventory Cost Tab
Click here for more information on U of M Equivalence.
Create Item Locations
The next step is to create Item Locations for your Items. Item Locations allow you to track the cost of your inventory by Location, or rather, each Location will have a different cost value for each Item. This is extremely useful if you have costs that vary significantly from one Location to another.
To auto-create Item Locations, open a Purchased Item record that has previously been saved, then navigate to the the 'Item Locations' tab and click the 'Create for all Locations' toggle. An Item Location record will be created for each Location in your R365 database. You can manually delete un-needed Item Locations by clicking the trashcan icon on the respective Item Location row.
Refer to the Item Locations article for more information about Item Locations.
Create Vendor Items
The final step in getting Item Costing up and running in R365 is creating Vendor Items. These records represent the Items you purchase from specific Vendors. Purchased Items can be considered 'Master Items', or Parents, while Vendor Items are the Child. Every Vendor Item must correlate directly back to a Purchased Item. Vendor Items have a Many to One relationship with Purchased Items, as shown below:
Refer to the Vendor Item article for more information about Vendor Items.