• Registered: 08/07/2014
  • Posts: 10

Topic: How can I setup a company that sells energy bars?

How should I setup manufacturing and inventory in the following scenario?

Lets call my company A.

Company A outsources work using company B for labor and equipment to produce energy bars.
Company A supplies ingredients, packaging, shipping.
Company B takes the ingredients and packaging and makes the bars for company A which then becomes a product ready to sell.

Each manufacturing session is for 3000 energy bars but there is leftover ingredients and packaging left.

Please help. this is my first time using FrontAccounting. It seems like a very useful tool.

Thank you!

  • joe
  • Administrator
  • Offline
  • Registered: 03/15/2007
  • Posts: 5,107

Re: How can I setup a company that sells energy bars?

Every legal company should have its own accounting. So it would be straight forward. If this sounds complicated, then please contact a local accountant.

Joe

  • Registered: 08/07/2014
  • Posts: 10

Re: How can I setup a company that sells energy bars?

What about small businesses that can not afford accountants?

Is there anything helpful out there?

  • From: Singapore, India, Chennai
  • Registered: 05/02/2009
  • Posts: 6,160

Re: How can I setup a company that sells energy bars?

Do you want FA for Company A or Company B or both and are the owners different?

apmuthu's Website

  • Registered: 08/07/2014
  • Posts: 10

Re: How can I setup a company that sells energy bars?

I want FA for Company A. Company B is just a supplier that provides labor and machine. Company A provides everything else including shipping everything to/from Company B.

Also thank you for offering some help finally!

apmuthu wrote:

Do you want FA for Company A or Company B or both and are the owners different?

  • From: Singapore, India, Chennai
  • Registered: 05/02/2009
  • Posts: 6,160

Re: How can I setup a company that sells energy bars?

Company A sells ingredients, packaging to Company B on no tax (escrow).
Company A buys back the finished product at the same cost plus the labour charge from Company B.
Company A now adds on shipping and sells it with tax to it's client.
No need to setup any manufacturing at all in Company A.

apmuthu's Website

  • Registered: 08/07/2014
  • Posts: 10

Re: How can I setup a company that sells energy bars?

Thank you apmuthu.

How can I do your suggestions. :

Company A sells ingredients, packaging to Company B on no tax (escrow).
- How do I set this up?

Company A buys back the finished product at the same cost plus the labour charge from Company B.
- How do I set this up?

Company A now adds on shipping and sells it with tax to it's client.
- How do I set this up?


I imagine all 3 scenario are same way so if you could show me 1 that would be great.

Second followup question is about Invoices.

If company A buys product for $2/unit and sells for $3/unit plus tax, but sells 12 units/box, how could company A create invoices for both per/unit and per/box for its customers. Basically Company A sells energy bars individually and in a box of 12 energy bars.

THANK YOU FOR YOUR HELP!

8 Reply by apmuthu (edited by apmuthu 09/02/2014 05:17:28 am)

  • From: Singapore, India, Chennai
  • Registered: 05/02/2009
  • Posts: 6,160

Re: How can I setup a company that sells energy bars?

For your followup question please refer Sales Kits in the FA Wiki.

All of the first 3 need to be setup in your FA instance to achieve what you want. Set up a No Tax entry in the taxes. There is also a stock location transfer method that can be used to avoid any vendor transfer transactions.

Company A defines their inventory stock items and Sales Kits composition of such items
Company A transfers individual component stocks to their storage location in Company B
Company B levies labour charge on Company A (accounted for as a vendor bill in Company A 's accounts)
Simultaneously, Company A now takes back the finished goods from their storage location in Company B back into Company A's main location, but this time it is in units of Sales Kits (components that make a single billable item).
Company A now sells the "Sales Kits" bunched component items set to their customers.

How to do all of this is well documented in the FA Wiki.

A related situation using Manufacturing / Assembling is this forum post.

apmuthu's Website