One specific area that we need to highlight is the use of Internal Selling in the relationship between Plant Items and the Workshop where the Plant Items are repaired.
A business that operates plant needs to know what each of these plant items is costing them. Each of these Plant Items is a specific Plant Job within Workbench so we can capture costs and compare with the 'Revenue' recovered from Plant Issues.
There are two ways of capturing the costs: - Specific and Summarised. Specific - All costs go direct to the Plant Job
SPECIFIC - ALL COSTS GO DIRECT TO THE PLANT JOB
This will include:-
- Supplier costs
- Stock issues
- Workshop labour and consumables
Advantage -
- less processing.
Disadvantage -
- There is no obvious breakdown of specific tasks that have been done on the vehicle. You can have Work Centre breakdown where you can categorise the types of vehicle expenses
Summarised -Workshop Jobs are setup and Internally 'Sold' to the Plant Job.SUMMARISED - WORKSHOP JOBS ARE SET UP INTERNALLY AND "SOLD" TO THE PLANT JOB
Where the Workshop is required to do specific work a separate Job is setup to capture all the costs associated with the work. At the completion of the work the Workshop job is 'sold' to the Plant Job using Internal Selling.
Advantage - :
- There are fewer transactions in the Plant Job. The transactions that are there are more meaningful eg. '6 month Service'
- Workshop can be held more accountable as the tasks they do are more transparent and therefore contestable.
Disadvantage - :
- more processing
This manual covering covers Internal Selling covers and the process to generate the internal sale. Once the internal sale is completed (batched) it appears as a cost on the Plant Job.