Drop Ship with 3rd party Landed Cost

(0) Share

Report

Posted on by KaylaRadics

175

I have been trying to streamline the process drop ship POs are entered that also include Landed costs which we receive 3rd party invoices for. Here is the scenario

Customer places an order for 100 tons of cement, vendor supplies it, 3rd party Hauler hauls it to multiple addresses then delivers the BOLs for that day back to our office at which point we enter PO/SOP (after the fact). The LC is a flat rate per ton but different per hauler. The pricing per order is different every time depending on the customer, with no quantity discounts and generally some variance from what they originally ordered ( which is not a concern considering we are receiving 'after the fact', please correct if I am wrong). The Haul doesn't have to be matched to a specific order, but the total cost of hauling for each site is something that we need. Currently using flexicoder to do so, so we also have the flexicoder capabilities at our disposal as well.

I've tried out a few different things I thought might work but am very new to GP and struggling to find the most efficient process. Surely I can't be the only person who has had this issue?

Was considering creating a 'Haul' line item for the Drop-Ship PO that would have distribution accounts set up to hit inventory and AP...maybe creating separate item files for that include Landed cost in the item detail.. Maybe just enter the haul invoices as received, separately in AP but then how would I match it to that PO?

Any ideas or input would be so appreciated. Thank you in advance!

*This post is locked for comments

I have the same question (0)

All responses (14)

Answers (1)

Frank Hamelly | MVP... 46,625 Super User 2025 Season 2 on at

Like (0)

Report

What are your end goals in terms of Inventory Valuation and Cost of Goods Sold? What is your business?

Was this reply helpful? Yes No
KaylaRadics 175 on at

Like (0)

Report

I'm referencing a 3rd party cement drop ship using haulers, which is a substantial cost. I would like the Haul to be treated as a Landed cost, hitting COGS. It could be another line item or evenly distributed over the order etc. as long it's still tied to the PO.

Thank you for the questions, looking forward to your response!

Was this reply helpful? Yes No
Suggested answer

Frank Hamelly | MVP... 46,625 Super User 2025 Season 2 on at

Like (0)

Report

You won't be able to use Landed Cost on a drop ship PO because drop ship items never hit inventory. Do you need to be able to match the product and hauling costs to a specific sale? If so, I would try creating the PO from your Sales Order and entering a second line on the PO representing the hauling cost.

Was this reply helpful? Yes No
KaylaRadics 175 on at

Like (0)

Report

Thank you again for the information, truly! That's where I've been leaning.

The costs don't need to be matched to a specific sale, although that would be optimal, just the hauler and site. Would adding Haul as a separate line item for each PO be easier/better practice than adding a new 'drop-ship' item class and including the LC in that item file? Then it could auto populate and have the desired accounting, right? Or taking into consideration that each site has approx. 15 to 20 haulers available for use at different rates each haul, would that complicate things?

Also, would I be entering thee sales order as drop ship then adding the LC as another line to receive once I get to the PO screen?

Or, am I entering via "add a new vendor" to the PO and adding Haul as a drop ship item?

Your help is so appreciated, thank you again!

Was this reply helpful? Yes No
Verified answer

Frank Hamelly | MVP... 46,625 Super User 2025 Season 2 on at

Like (0)

Report

First, GP Landed Cost will not work on a Drop Ship PO, period. Landed Cost will only work on items that you receive into Inventory and Drop Ship items never hit inventory, they get charged directly to COGS when you post the vendor invoice. So we need to consider the alternatives.

I'm not sure what you mean by 'entering three sales orders'. Why three? I probably don't understand the complexities of your process, but what I have in mind is entering a Sales Order for the sale and delivery of the concrete to your customer. The SO would have two lines on it - the Concrete and the Delivery (Haul charge). Now, here's a question - does the concrete supplier also provide delivery or is that via 3rd party?

Was this reply helpful? Yes No
KaylaRadics 175 on at

Like (0)

Report

My apologies, "three" was meant to say "the". Also, I know I can't do drop ship with LC so I am looking for a work around, probably should have lead with that :/ A 3rd party Hauler is used, so wouldn't adding Haul as a line item on the sales order invoice the customer? We take the burden of this cost, and therefor want to account for it as Landed. The Haulers have to spin, rinse, mix, lay and deliver the cement so the actual process is a bit more complicated than you would have for any other kind of delivery, making it more expensive which is why we want to absorb the cost.

Did I clarify that? Thank you for your patience, you are being so helpful :)

Was this reply helpful? Yes No
Suggested answer

Frank Hamelly | MVP... 46,625 Super User 2025 Season 2 on at

Like (0)

Report

Keep in mind I haven't tested this (leaving that to you :)), so it's semi-theoretical, although it should work. You could make the Haul line item on the SO $0, so there is no billing to the customer. Or, you could add the Haul to the drop ship PO after it's been created from within the SO.

Was this reply helpful? Yes No
KaylaRadics 175 on at

Like (0)

Report

I actually tried to give both these options a go. I want to avoid the zero sale and $0 invoice to the customer though and I still need to pay my Hauler and have the cost hit inventory.

Also, adding the haul to the drop ship PO after its been created would be optimal, but if I want to use the SOP-POP link functionality and use "purchase" to create my PO, where exactly should I be entering that? That drop down/tree PO screen only offers me the ability to add a vendor which is not what we're going for.

Creating an item file for Haul, would I be able to set the account distributions in a way that it would still hit inv & AP?

The only small amount of luck I have had is adding Haul as an LC when receiving, which doesn't invoice match but at least keeps the accounting straight.

What about using one of the POP setup screens to change the 'Other' line item (under freight, tax etc.) to be Haul?

This post/blog/line of communication is fantastic. Thank you so much

Was this reply helpful? Yes No
KaylaRadics 175 on at

Like (0)

Report

Actually, do either of the last two options really keep accounting straight? Same distribution as LC on a standard PO with a matched receipt?

Was this reply helpful? Yes No
Frank Hamelly | MVP... 46,625 Super User 2025 Season 2 on at

Like (0)

Report

1. Why would you want to have Haul cost hit inventory? It will never be in your inventory, hence it shouldn't hit an inventory account.

2. You would create the drop ship PO from the SO and save it, then open the PO from Purchasing>>Transactions>>PO Entry and add the line there and save the PO.

Do you have a Microsoft Partner your company works with that you could consult with? I'm not sure how effective the forum is for this discussion because I feel like I'm not seeing the big picture from a requirements perspective.

Was this reply helpful? Yes No

Community site session details

Drop Ship with 3rd party Landed Cost

Helpful resources

Quick Links

Responsible AI policies

Neeraj Kumar – Community Spotlight

Congratulations to the November Top 10 Community Leaders!

Leaderboard > 🔒一 Microsoft Dynamics GP (Archived)

Featured topics

Product updates

Community site session details

Drop Ship with 3rd party Landed Cost

Helpful resources

Quick Links

Responsible AI policies

Neeraj Kumar – Community Spotlight

Congratulations to the November Top 10 Community Leaders!

Subscribe to this forum!

Select categories

Leaderboard > 🔒一 Microsoft Dynamics GP (Archived)

Featured topics

Product updates