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8Hii Everyone,
I am currently working on a Business Central implementation for a manufacturing client and I would like to share the full business requirement in detail and seek the community's advice on the best possible approach to achieve this within Business Central. I want to understand what options are available and what the most recommended solution would be before I proceed with the configuration.
I have explained the client's requirement in full depth below. Any advice, alternative approaches, best practices, or real-world experience from the community would be greatly appreciated.
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SECTION 1 — UNDERSTANDING THE CLIENT'S BUSINESS AND WHAT THEY WANT
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My client is a manufacturing company that produces a wide range of finished goods. Their manufacturing process is not straightforward — depending on the item, production can involve purely in-house work, purely purchased items from external vendors, or a combination of both within the same part's production journey.
To bring structure and clarity to their operations in Business Central, the client has provided two key reference documents:
1. A Product Lines spreadsheet that lists every product line they use
2. A Product Category Codes spreadsheet that defines their category classifications
2. A Product Category Codes spreadsheet that defines their category classifications
Both documents follow the same structure. For every product line and category code, the client has defined the following attributes:
- Product Line Code / Category Code: A short code that identifies the group (for example, BTS, FLATBED, COMPONENT, AERO RAW)
- Description: The full name or meaning of that code
- Is New: Whether this is a brand new product line or category that needs to be created in the system from scratch, or whether it already exists and only requires a description update
- Is Sold: Whether items belonging to this product line or category are sold to customers on Sales Orders
- Is Purchased: Whether items are procured from external vendors via Purchase Orders
- Is Produced through Production Order: Whether items are manufactured in-house using Production Orders
- What It Is Used For: A plain-language description of the purpose of that product line or category
- Description: The full name or meaning of that code
- Is New: Whether this is a brand new product line or category that needs to be created in the system from scratch, or whether it already exists and only requires a description update
- Is Sold: Whether items belonging to this product line or category are sold to customers on Sales Orders
- Is Purchased: Whether items are procured from external vendors via Purchase Orders
- Is Produced through Production Order: Whether items are manufactured in-house using Production Orders
- What It Is Used For: A plain-language description of the purpose of that product line or category
The client wants all of these product lines and category codes to be correctly set up and reflected in Business Central so that every item in the system is properly classified and the system behaves accordingly — meaning the correct transaction types (Sales Orders, Purchase Orders, Production Orders) are triggered for the right items.
The some list of product lines the client uses is as follows:
- AERO BTS (Aero Buy to Sell): New. Items are sold and purchased. Not produced in-house. Used for buy-to-sell items within the Aero product range.
- AERO COMPONENT (Aero Component): New. Not sold. Partially purchased and partially produced. Used for Aero parts that involve subcontracting.
- BTS (Buy to Sell): Already exists but description needs updating. Items are sold and purchased. Not produced in-house. Used for buy-to-sell items outside of Aero.
- DO NOT USE: Already exists. Not sold, not purchased, not produced. These are obsolete items being retained in the system purely for historical reference. The client intends to review these later but is keeping them for now as they reflect historical data and some may be used in the future.
- FEES: Already exists. Items are sold and purchased. Not produced. Used for fees applied to Sales Orders and Purchase Orders.
- AERO COMPONENT (Aero Component): New. Not sold. Partially purchased and partially produced. Used for Aero parts that involve subcontracting.
- BTS (Buy to Sell): Already exists but description needs updating. Items are sold and purchased. Not produced in-house. Used for buy-to-sell items outside of Aero.
- DO NOT USE: Already exists. Not sold, not purchased, not produced. These are obsolete items being retained in the system purely for historical reference. The client intends to review these later but is keeping them for now as they reflect historical data and some may be used in the future.
- FEES: Already exists. Items are sold and purchased. Not produced. Used for fees applied to Sales Orders and Purchase Orders.
The Product Category Codes are as follows:
- FINISHED (Finished Goods): Already exists. Sold and produced in-house. Not purchased. Covers all finished items made in-house.
- BTS (Buy-to-Sell): Already exists. Sold and purchased. Not produced. All items bought from a vendor and sold directly to the customer.
- MATERIAL (Materials): Already exists. Not sold. Purchased only. All raw materials used in production.
- COMPONENT (Components): New. Not sold. Partially purchased and partially produced. Covers all partially completed items that involve subcontracting at one or more stages.
- BTS (Buy-to-Sell): Already exists. Sold and purchased. Not produced. All items bought from a vendor and sold directly to the customer.
- MATERIAL (Materials): Already exists. Not sold. Purchased only. All raw materials used in production.
- COMPONENT (Components): New. Not sold. Partially purchased and partially produced. Covers all partially completed items that involve subcontracting at one or more stages.
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SECTION 2 — THE MOST COMPLEX REQUIREMENT: COMPONENT ITEMS
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The most critical and technically complex part of this requirement is the COMPONENT product line and category code, which is marked as "Partially" for both Purchased and Produced. This partial classification exists because component items do not follow a single, simple transaction type. Instead, a single finished part goes through multiple stages, and each stage is handled differently — some stages are sent to external vendors and received back on Purchase Orders, while other stages are processed entirely in-house using Production Orders.
The client provided a detailed real-world example to explain this. The part number is 31-4407-1 and its full production journey is described below.
PRODUCTION JOURNEY OF PART 31-4407-1
STEP 1 — Starting Raw Material: AL565
The production process begins with the raw material AL565, which is an aluminum sheet measuring 24 inches by 48 inches. This raw material is pulled from inventory and sent out to an external vendor named Tool Tech to be processed via water jet cutting.
The production process begins with the raw material AL565, which is an aluminum sheet measuring 24 inches by 48 inches. This raw material is pulled from inventory and sent out to an external vendor named Tool Tech to be processed via water jet cutting.
STEP 2 — 31-4407-1-CMP1 (Component 1): Received via Purchase Order
Once Tool Tech completes the water jet cutting, the cut parts are shipped back to the client and received into the system as 31-4407-1-CMP1. The "CMP" in the part number stands for Component, and "1" indicates it is the first component stage. Because these parts are being received from an external vendor, they are processed on a Purchase Order. This stage is therefore classified as Purchased.
Once Tool Tech completes the water jet cutting, the cut parts are shipped back to the client and received into the system as 31-4407-1-CMP1. The "CMP" in the part number stands for Component, and "1" indicates it is the first component stage. Because these parts are being received from an external vendor, they are processed on a Purchase Order. This stage is therefore classified as Purchased.
STEP 3 — 31-4407-1-CMP2 (Component 2): Produced via Production Order
CMP1 is then taken and processed entirely within the client's own facility. The in-house operations performed at this stage are De-Nubbing, which takes approximately 5 seconds per unit, and De-Burring, which takes approximately 15 minutes. These operations are performed on Workstation 127 (Fabrication Center). Once both operations are complete, the part becomes 31-4407-1-CMP2. Because this work is performed entirely in-house, it is managed via a Production Order. This stage is classified as Produced In-House.
CMP1 is then taken and processed entirely within the client's own facility. The in-house operations performed at this stage are De-Nubbing, which takes approximately 5 seconds per unit, and De-Burring, which takes approximately 15 minutes. These operations are performed on Workstation 127 (Fabrication Center). Once both operations are complete, the part becomes 31-4407-1-CMP2. Because this work is performed entirely in-house, it is managed via a Production Order. This stage is classified as Produced In-House.
STEP 4 — 31-4407-1-CMP3 (Component 3): Received via Purchase Order
CMP2 is then sent out to a second external vendor named Hohman to undergo a plating process, which is a surface coating operation that takes approximately 2.6 minutes. The plated parts are received back from Hohman as 31-4407-1-CMP3. Again, because these parts are being received from an outside vendor, they are processed on a Purchase Order. This stage is classified as Purchased.
CMP2 is then sent out to a second external vendor named Hohman to undergo a plating process, which is a surface coating operation that takes approximately 2.6 minutes. The plated parts are received back from Hohman as 31-4407-1-CMP3. Again, because these parts are being received from an outside vendor, they are processed on a Purchase Order. This stage is classified as Purchased.
STEP 5 — 31-4407-1 (Finished Good): Produced via Production Order
Finally, CMP3 is brought in-house for a quality Inspection, which takes approximately 15 minutes and is performed on Workstation 239. Once the part passes inspection, it is recorded in the system as the Finished Good, part number 31-4407-1, and is ready to be shipped to the customer. Because the inspection is performed in-house, this final stage uses a Production Order. This stage is classified as Produced In-House.
Finally, CMP3 is brought in-house for a quality Inspection, which takes approximately 15 minutes and is performed on Workstation 239. Once the part passes inspection, it is recorded in the system as the Finished Good, part number 31-4407-1, and is ready to be shipped to the customer. Because the inspection is performed in-house, this final stage uses a Production Order. This stage is classified as Produced In-House.
Complete Production Flow for Part 31-4407-1:
AL565 (Raw Material — Aluminum Sheet 24" x 48")
| Sent externally to Tool Tech for Water Jet Cutting
31-4407-1-CMP1 — Received back via Purchase Order (Purchased)
| De-Nubbing (5 sec/unit) and De-Burring (15 min) performed In-House on Workstation 127
31-4407-1-CMP2 — Produced In-House via Production Order
| Sent externally to Hohman for Plating (2.6 min)
31-4407-1-CMP3 — Received back via Purchase Order (Purchased)
| Inspection (15 min) performed In-House on Workstation 239
31-4407-1 — Finished Good — Ready for Shipment to Customer
| Sent externally to Tool Tech for Water Jet Cutting
31-4407-1-CMP1 — Received back via Purchase Order (Purchased)
| De-Nubbing (5 sec/unit) and De-Burring (15 min) performed In-House on Workstation 127
31-4407-1-CMP2 — Produced In-House via Production Order
| Sent externally to Hohman for Plating (2.6 min)
31-4407-1-CMP3 — Received back via Purchase Order (Purchased)
| Inspection (15 min) performed In-House on Workstation 239
31-4407-1 — Finished Good — Ready for Shipment to Customer
This is precisely why the COMPONENT product line and category code cannot be simply marked as fully Purchased or fully Produced. The classification is Partial because different component stages within the same part's journey use different transaction types.
The client has also shared detailed Router files in Excel format for each component stage (CMP1, CMP2, CMP3, and the Finished Good). These router files include:
- Bill of Materials (BOM) for each stage, showing the input material or previous component and the quantity used
- Routing Steps detailing each operation, the time required, and the workstation or department responsible
- A standard Burden Rate of $39.00 per hour applied uniformly across all workstations
- Bill of Materials (BOM) for each stage, showing the input material or previous component and the quantity used
- Routing Steps detailing each operation, the time required, and the workstation or department responsible
- A standard Burden Rate of $39.00 per hour applied uniformly across all workstations
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SECTION 3 — QUESTIONS FOR THE COMMUNITY: WHAT IS THE BEST WAY TO ACHIEVE THIS IN BUSINESS CENTRAL?
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I would like to ask the community for advice on the best possible solutions to achieve this setup in Business Central. I am open to understanding all available options and would like guidance on which approach is the most practical, scalable, and aligned with Business Central best practices.
Question 1 — Product Lines Configuration:
Business Central does not appear to have a native "Product Line" field. My current thinking is to configure Product Lines as a Global Dimension with Dimension Values for each product line code. Is this the correct and most recommended approach? Is there a better or more native way to handle product line classification in Business Central that would allow it to be used consistently across Sales Orders, Purchase Orders, and Production Orders?
Business Central does not appear to have a native "Product Line" field. My current thinking is to configure Product Lines as a Global Dimension with Dimension Values for each product line code. Is this the correct and most recommended approach? Is there a better or more native way to handle product line classification in Business Central that would allow it to be used consistently across Sales Orders, Purchase Orders, and Production Orders?
Question 2 — Product Category Codes Configuration:
For Product Category Codes, I am planning to use Business Central's native Item Categories. Is this the right approach? Are there any limitations to be aware of when using Item Categories for this purpose?
For Product Category Codes, I am planning to use Business Central's native Item Categories. Is this the right approach? Are there any limitations to be aware of when using Item Categories for this purpose?
Question 3 — Handling Component Items That Are Partially Purchased and Partially Produced:
This is the most critical question. Given that component items alternate between being purchased from subcontractors and produced in-house at different stages, what are the possible ways to handle this in Business Central? What is the best and most recommended approach? I want to understand all available options before deciding on the right configuration.
This is the most critical question. Given that component items alternate between being purchased from subcontractors and produced in-house at different stages, what are the possible ways to handle this in Business Central? What is the best and most recommended approach? I want to understand all available options before deciding on the right configuration.
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