Inventory Management Series
Using kit and assembly items
There are two types of items in Microsoft Dynamics Retail Management System (RMS) that help you sell a group of items all at once: kit items and assembly items. While these item types can be used for similar purposes, there are some key differences between them.
In this article, we’ll explore these differences and provide step-by-step instructions for creating, selling, and tracking kit and assembly items.
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Useful terminology
Here are some terms and definitions that you will need to understand as you read about kit and assembly items in Microsoft Dynamics RMS.
| • | kit item – A group of items that are bundled together—sometimes in a larger package, such as a basket or box—and sold together as a single item. |
| • | assembly item – A group of items that are sold at the same time but listed individually in the transaction, creating a “bill of material” list of items. In other words, ringing up the assembly item is like running a macro that pulls all of the component items into the transaction. |
| • | component items – The items included in the kit or assembly item. |
| • | build a kit – Increase the in-stock quantity of the kit item by the specified number of kits, while at the same time reducing as appropriate (and making unavailable for individual sale) the in-stock quantities of the component items in the kit. |
| • | break out a kit – Decrease the in-stock quantity of the kit item by the specified number of kits, while at the same time increasing as appropriate (and making available for individual sale) the in-stock quantities of the component items in the kit. |
How kit and assembly items are different
There are several key differences between kit and assembly items:
| • | How component-item quantities are handled. In a kit item, the component-item quantities are reserved when the kit is built, and the component items in the built kits are not available for individual sale (unless the kit is broken out). When the kit is sold, only the in-stock quantity for the kit item is affected. In an assembly item, the component-item quantities are not reduced until the time of sale. The assembly item itself does not have an in-stock quantity. |
| • | How component items appear in the transaction. When a kit item is rung up, a single line item is added to the transaction, with the component items listed in the description of the kit. The component items cannot be modified. When an assembly item is rung up, one line item is added to the transaction for each component item in the assembly. The component items can be removed or changed, and their sold quantities can be adjusted. |
| • | How item prices and costs are handled. The cost of a kit item is the sum of the costs of the component items. The price of a kit item is whatever you set it to be. This allows you to offer automatic discounts to customers who purchase the kit. Because the component items in an assembly item are sold individually (albeit in the same transaction), an assembly item does not have its own price and cost. This means that, in effect, the price or cost of the assembly item is equal to the sum of the prices or costs of the component items. However, you can choose to set special prices for the component items in an assembly item, allowing you to offer “package deals” to your customers. |
| • | How low-stock situations are handled. If a kit item that is out of stock is rung up, Microsoft Dynamics RMS will automatically build a kit to fulfill the request, provided there is sufficient stock of the component items. If any component-item quantities are low, a message appears giving the cashier the option to select a substitute item for the kit, back order the kit, or add the kit to the transaction anyway. If the kit is sold anyway, the database quantities for the low-stock component items will go into negative numbers. If an assembly item is rung up when component-item quantities are too low to fulfill the request, a message appears for each out-of-stock component item. The cashier has the option to select a substitute for the component item, back order the component item, or add the component item to the transaction anyway (making the database quantity for that item a negative number). |
| • | How sales are tracked. Every sale of the kit item is recorded and can be viewed in reports such as the Detailed Sales report. Sales of assembly items are not tracked. Instead, you can track sales of the component items in the assembly. |
When to use kit items
Using a kit item is appropriate when:
| • | You want to package the items together. |
| • | The component items are sold more frequently in the kit than individually. |
| • | You don’t want to allow substitutions. |
| • | You want to know how many bundles are sold. |
Examples
First-aid kits
Gift baskets
Clothing sets
Video game packs
When to use assembly items
Using an assembly item is appropriate when:
| • | The component items are often sold individually. |
| • | You want to allow substitutions or offer upgrade options. |
| • | The component items are too bulky to be packaged together. |
| • | You don’t need to track sales of the bundles. |
Examples
Computer bundles
Bedroom sets
“Combo” promotions
Infant nursery collections
Creating and selling kit items
Kit items are similar to standard inventory items except that they contain component items, such as with a first-aid kit that contains a selection of first-aid supplies. You can build a kit or break out a kit to adjust your stock.
To create and build a kit item
1. | Create any component items that do not already exist in the store database. |
2. | Create the standard item as usual, selecting Kit in the Item type box. Tip
If you put a marker into the description of each kit item – such as the word “kit” – you will be able to filter your sales reports to show only kit items. |
3. | Click the Kit tab. |
4. | For each component item that you want to include, click Add, select the item, and then click OK. |
5. | Set the quantity of each component item included in the kit. Click the appropriate box in the Quantity column, and then type the quantity. For example, the kit item shown in the image below includes a single toy and two packages of batteries. 
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6. | When the component items are all in the list, click Build. |
7. | Type the number of kit items to build, and then click OK. |
8. | Click OK to save the item and build the kits. |
When you build a kit item, the quantity on hand for the kit item increases by the number of kits that you build. Also, the quantities of the component items are reduced by the specified amounts; those items are no longer available for individual sale once they are built into the kit.
To break out a kit and make the component items available for individual sale
1. | On the Kit tab for the item, click Breakout. |
2. | Type the number of kits to break out, and then click OK. |
3. | Click OK to save the item and break out the kits. |
When you break out a kit, the quantity on hand for the kit is reduced by the number of kits that you break out, and the quantities on hand for the component items increase accordingly.
To sell a kit item
| • | Ring up the item as you would any other item. |
The transaction pane shows the kit as a single line item, with the component items listed within the line item for your convenience.
Since the quantities on hand for the component items were automatically adjusted when you built the kit, only the quantity on hand of the kit item itself is affected by the sale.
If a kit item is rung up and there are no built kits available in the store database, the kit is built automatically as long as there are sufficient quantities of the component items available. If any quantities are low, a message appears giving the cashier the option to select a substitute item for the kit, back order the kit, or add the kit to the transaction anyway (putting the database quantities for the out-of-stock component items into negative numbers).
Creating and selling assembly items
Assembly items are a special item type. They contain component items, but – unlike kit items – the component items are not reserved or built into the assembly items. Instead, the assembly item merely provides a convenient way to ring up a group of related or complementary items.
To create an assembly item
1. | Create any component items that do not already exist in the store database. |
2. | On the Database menu in Store Operations Manager, click Items, and then click New. |
3. | Select Assembly Item, and then click OK. |
4. | Type a lookup code and description. |
5. | For each component item that you want to include, click Add, select the item, and then click OK. |
6. | Set the quantity of each component item included in the assembly. Click the appropriate box in the Quantity column, and then type the quantity. |
7. | If you want to set up special pricing for the assembly item, select the Use component price check box, and then specify a new price for any component item that you want to discount. The regular price of the component item will not be affected. For example, the prices of the component items in the assembly item shown below are discounted from their individual purchase prices by 10 percent. 
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8. | Click OK to save the item. |
To sell an assembly item
| • | Ring up the item as you would any other item. |
Each of the component items in the assembly will be added to the transaction. Any discounted prices will be marked with a red lightning bolt.
The image below illustrates how this works. The two items marked with red lightning bolts were added to the transaction and automatically discounted when the cashier rang up the “Basketball starter set” assembly item. The same items added individually did not receive the assembly discount.
Tracking kit and assembly items
You can use the built-in reports in Microsoft Dynamics RMS to track both the creation and sale of kit items. The Item Movement History report shows when component items are built into or broken out of kit items. For tracking sales, you can generate any sales report and it will include information about kit items sold or returned during the specified time period.
As we mentioned before, sales of assembly items will not be included in your reports. Instead, you can track the sales of the component items that are included in your assembly items.
To generate the Item Movement History report
1. | On the Reports menu in Store Operations Manager, point to Items, and then click Item Movement History. |
2. | Set filter settings as desired. To filter the report so it shows only information about built and broken-out kits, click Type in the Field box, type “Kit Component Transfer” (without quotes) in the Filter value box, and then click Add. |
3. | Click OK to generate the report. |
To generate a sales report
1. | On the Reports menu in Store Operations Manager, point to Sales, and then click the report that you want to generate. |
2. | Set filter settings as desired, and then click OK. Tip
If you put a marker into the description of each kit item – such as the word “kit” – you will be able to filter your sales reports to show only kit items. |
For more information about filter settings, see “Filtering report data” in Store Operations Online Help.
What’s Next
The next article in this series, Counting physical inventory, provides tips and step-by-step instructions for using the inventory count features in Microsoft Dynamics RMS.
