Discrete manufacturing involves the assembly of parts to create finished batches of products that exist as a unit (a batch). Alternative manufacturing methods supported by SOS include make to order, make to contract and process manufacturing.
Discrete Manufacturing vs. Process Manufacturing
If discrete manufacturing involves the batch manufacture of a products via a bill of materials, process manufacturing uses recipes or formulas that change the raw materials when producing the finished product, which (unlike discrete manufacturing) cannot be disassembled to recreate the raw materials, as they have been transformed in the production process.
Electronics and vehicles are examples of products created by discrete manufacturing processes, but virtually any item sold in a store requires the assembly of different parts. Some of those parts may have been produced via process manufacturing prior to being provided to the discrete manufacturer to assemble.
As the discrete manufacturer assembles a finished product, it must be added to inventory while, at the same time, the parts used to create it must be removed to ensure accurate inventory counts. Product in all stages (work in progress) adds raw materials and labor costs to update the value of the product as it goes through production.
Both types of manufacturing processes can readily be managed with the help of SOS Inventory software, which has been specifically designed to add advanced inventory features for QuickBooks Online users.
All the steps involved must be tracked and costs recorded to ensure the business meets demand while minimizing the amount of cash invested in inventory. All operations from arrival of supplies through delivery of finished product to the customer must be accurately tracked to keep finances up-to-date and production continuous.
SOS Inventory Features for the Discrete Manufacturer
Many products manufactured by these processes involve the individual assemblies of different parts by different teams. Eventually these parts are added to the workflow, leading to the completion of a finished product. No matter how many BOMs are created for each assembly template, SOS Inventory captures the costs of each one, including labor and overhead, to keep figures consistent throughout the system for any department accessing the information. In SOS Inventory, an assembly is the output of discrete manufacturing, where raw materials are turned into one or more units of a finished good, based on a bill of materials (BOM).