Product Lines

A product line is a group of similar items or products. At the corporate level, a company’s sales and operations are often planned, reported, and analyzed by product line rather than by individual item or product. This higher-level view of activity makes it easier to relate day-to-day operations to the company sales and operations plan.

By dealing with an aggregate, it is sometimes possible to get a clearer, more accurate picture. For example, a shipment forecast for a product line is more accurate than a forecast for a specific item.

Before you define product lines, you should determine the most important criteria for grouping items. Unfortunately, different departments usually want to divide items differently. For example, Sales may want to group products by target market, but Manufacturing wants to group products by production method.

Product lines group items for accounting and planning purposes:

• Each product line is associated with specific GL accounts for inventory, sales, and purchases. By default, transactions for items belonging to the product line update these GL accounts. You can also set up alternate product line accounts when it is necessary to aggregate inventory, sales, work orders, or purchasing by site. See Alternate Product Line Accounts for details.

• All of the planning programs—including product line planning, resource planning, MRP, MPS, and forecasting—can be run by product line.

• On sales, purchasing, and service/support management transactions, an item’s taxable status defaults from the product line.

This is a standard cost system, although it can be used as an average cost system. The product line GL accounts are oriented to standard cost accounting. The values for these accounts default from Domain/Account Control (36.9.24). The accounting department is usually responsible for approving these.

See QAD Financials User Guide for details on GL setup.

When setting up similar product lines, you can use a copy function to streamline data entry by copying data from one product line to a new one. You can also use a replacement function to replace all occurrences of one product line with another. In this case, the system updates the references on any opens sales orders, sales quotes, customer scheduled orders, Return Material Authorizations (RMAs), work orders, or on-hand inventory accounts (GL), ensuring correct reporting of account balances.