Production Advanced

Adding Labour to a Production Job

Labour can be added to a Production Job to incorporate labour costs into the finished product. This article explains how.

Overview

You may wish to add additional line items to your production jobs for labour or fees. This will give you a more accurate cost and therefore more accurate reports.

There are two main ways this can be done, and you will choose on the basis of how you pay for the labour.

Adding Contract Labour to a Production Job

If you use contract manufacturers, you can apply fees, costs of labour or other costs to your Production Jobs to accurately reflect the cost of the products that you have made.

Because you are purchasing the labour from a third-party, you can treat the additional fees as products, receive them into the inventory, and then use them within a Production Job just as any other product.

You may find it easier to set the stocktake method for labour to Batch, and upon receiving in these 'products', applying the Production Job number as the batch number - this will ensure that when you come to complete your Production Job, you apply the right labour product to the right Production Job.

Adding your own labour to a Production Job

If you wish to add the labour of your own staff to a Production Job, this labour must not be purchased as above, as it will be accounted for very differently through your payroll.

These costs can be added to Production Jobs by creating non-stock or non-diminishing products in the products module. For more information on how to do this, please see Non-Stock Products.

Once added to the production job, the cost of this line item - which can be entered or adjusted in the cost column - will inflate the cost of the finished goods.

This inflated cost will appear within Cin7 only. Importantly, this cost does not form part of the COGS that gets passed to your accounting software. Upon import to your accounting software the cost of any non-stock products applied will be stripped from the COGS.

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