Drop Shipments in Microsoft Dynamics NAV 2015
I’m going to go through a simple example of drop shipments and how to perform them in NAV. I’m going to quickly go over creating sales orders and purchase orders because I have those in other videos.
For those who don’t know what drop shipments are, basically in NAV – and mostly everywhere – means that we put in a sales order that’s linked to a purchase order.
We want the vendor to directly ship the product to the customer so it does not enter our warehouse.
Create a New Sales Order
Let me go ahead and create a brand new sales order.
I am going to sell to The Cannon Group, which is a favorite among people who demo NAV.
I am selling the coffee mug again, hence the name of the videos.
I’m selling 25 and I’m getting $15 for each.
If I go all the way to the end here, there is a field called Purchasing Code. This actually gives several options, one of them being Drop Ship. I will demonstrate others in other videos, so I’m focusing this time only on Drop Ship. So I’m going to select that.
And now that’s ready. So, I’ll close this screen and I’ll move on to the purchase order.
Create the Purchase Order
Now if I’m the purchaser and I’m fulfilling a drop ship order, there are a couple of ways I can do that in NAV. I’m only going to show the simple one, which is from the purchase order itself, in this video. I will focus on other ways in other videos. So I go into the purchase order.
I’m going to create a new Purchase Order.
This is going to be from Custom Metals Incorporated, which apparently does ceramics as well. Oh yeah the coffee mug is ceramic, if you were wondering!
Instead of starting to type in the item, I actually want to get the item. I want to get it from the drop ship.
But before I do that, what I need to do and this is a little tricky, you have to say which customer you are selling to, and I was selling to The Cannon Group.
I then go up to the drop shipment and Get Sales Order.
I will see all of Cannon Group’s sales orders. I’m going to select the one that I want, which is 1008, which is the one I just created and hit OK.
It will fetch the coffee mug in here – 25 PCS.
Now you can see that the ‘Ship To’ is The Cannon Group in Atlanta. That’s a ‘Ship To’ on this purchase order to this vendor.
So I’m just going to put in an invoice number – ‘ABC43243'.
Post the Purchase Order
And I’m going to go ahead and post this, post this purchase order and it looks good.
We have to receive first and then invoice, so I’ll do that. We’ll receive, and that is because when I receive it automatically ships.
So I’ll close this out and go to my sales order.
Go to your Sales Order
Sales order’s up here – 1008.
Go look at Quantity to Ship, that’s 0, and Quantity Shipped is 25.
So that happened automatically as I received the purchase order. And since that happens instantaneously as I’m receiving the purchase order, the inventory does not stay in our warehouse.
Review Drop Shipment Purchase Receipt and Sales Shipment in the Item Ledger Entries
Technically it just went by our warehouse and if just to emphasize that point, I go to my Items.
And go to the coffee mug.
Go to the Ledger Entries.
I can see that there is a purchase receipt and a sales shipment that happened immediately on just that one posting. It’s all closed out.
Basically the system looks at this as I received it and shipped it out through the Blue warehouse, but it happened instantaneously so everything is closed out properly. And that’s how drop shipments work in NAV.