Table of Contents
Purpose
Understanding Purchase Units versus Allocation Units is especially useful when you buy an item in a larger bulk quantity and apply it in much smaller amounts. You may do this because of special price breaks or just because that is the only way the vendor sells the item!
This article:
Defines the different unit types that are represented in Aspire and where to find them.
Shows how to set up units for items inside of the Item Catalog,
Helps you understand unit types that are displayed on Purchase Receipts in the Purchasing module, in addition to units and the conversion factor shown in work tickets.
This article is supplemental to our Adding Items to the Item Catalog article. If you haven't already, please read that article first.
Purchase Units vs. Allocation Units
🧠 To understand the difference between purchase units and allocation units, think about when you are purchasing items and how you want to allocate them on work tickets in Aspire.
Aspire allows you to purchase items in one type of unit but you can allocate these items on work tickets in either a smaller quantity or a different unit of measurement.
💡 For instance:
Smaller quantity: Buying a 50lb bag of grass seed becomes fifty 1 lb allocations of grass seed.
Different unit of measurement: Buying 1 gallon of weed killer becomes 128 ounces of weed killer.
Did You Know 🤔
The Purchase Units on purchase receipts are converted to allocation units on a work ticket. Allocation units are what appear on Estimates, in Work Ticket allocations, and in Inventory.
Setting Purchase and Allocation Units for Catalog Items
When you add an item to the item catalog, you can set the purchase unit and decide what the allocation unit will be for estimating and job costing. You are able to add a conversion factor that allows Aspire to convert purchase units to allocation units on purchase receipts.
📌 Note: Once an item has been saved to the catalog, you cannot change the purchase units or the allocation units. If you need to change the units, clone the item, and choose the correct purchase and allocation units. You will then inactivate the original item.
Click Settings and then Administration.
Under Estimating, click on Item Catalog and then New.
For this example, we will create a new Material Item.
Enter your Item name, Category, Assigned Branch and any additional fields required for your item. For our example, we are adding a 50lb bag of grass seed, allocating in 1lb units.
To help understand your Purchase Units and Allocation Units, read the highlighted below as an equation.
First, set your Purchase Unit Cost. This is what the cost is when you are purchasing that item. When we buy the item, it will cost us $65.00.
Next, choose your purchase units. If you do not see your purchase unit, add the unit by going to Administration ➡️ Application ➡️ Lists ➡️ Unit Type.
Now, before calculating your conversion factor, focus on the Allocation Unit. Ask yourself, "What will my crews be allocating the item as?" In this example, we will be allocating the Grass Seed by the pound (lb).
Based on the allocation unit we set, calculate and enter the conversion factor in the Allocation field. Since we buy one 50lb bag of Grass Seed, and we allocate by the 1 pound, we get 50 1 lb. allocations. That means 50 will be our conversion factor.
After the Allocation field and Allocation Unit are filled out, Aspire calculates the Allocation Unit Cost automatically. In this case, it's $1.30 per lb of Grass Seed used since $65.00 / 50 = $1.30.
Kits
After adding your item, you can then add it to a kit for your estimate depending on your production factors and takeoffs.
📑 To learn more about kits, read Creating a Kit for the Item Catalog.
The Units on Purchase Receipts
When working with Purchase Receipts the unit costs are displayed in both Purchase and Allocation units.
When adding items to a purchase receipt, the quantities are shown in purchase units and purchase unit price as this is how we buy it from the vendor.
Quantities and Unit Costs in Inventory are shown as Allocation Units and Allocation Unit Costs.
(Navigation: Purchasing ➡️ Inventory ➡️ Select Location ➡️ Allocations ➡️ Search Item ➡️ View Unit Cost column)
Displayed on the Purchase Allocations window, the Conversion Factor for the Allocation Units will multiply the Purchase Units to show the Allocation Total.
The Units on Work Tickets
If you purchased a 50lb bag of Grass Seed into Inventory, then have a job where you only needed to apply 1 lb of Grass Seed, this is reflected in the Work Ticket Costs window below.
The Actual Quantity field is displayed in allocation units (ACT QTY).
The Actual Cost field is based on the Allocation Unit Costs (ACT $).
(Navigation: Work Tickets ➡️ Select Work Ticket ➡️ After you have added the allocation, click on the actual cost on the work ticket to review Work Ticket Costs.)