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Setting up ERPNext for manufacturing: BOMs, work orders, Production Plan, job cards, subcontracting and quality checks, plus the mistakes to avoid.
ERPNext has manufacturing built in, not added on. The same system that raises your GST invoices also holds your bills of materials, plans production, issues material to the shop floor and books finished goods into stock. For a small or mid-sized manufacturer, that means one set of numbers instead of Tally plus a dozen spreadsheets.
This guide covers the parts of ERPNext that matter for manufacturing, how they fit together, a setup checklist and the mistakes we see most often. It is based on current ERPNext.
These are the documents you will work with every day:
Around them sit the stock, buying, selling, quality and subcontracting modules. A manufacturer usually needs all of them.
The BOM is the foundation. If it is wrong, every work order, material request and cost built on it will be wrong too.
A BOM has:
Most products have sub-assemblies that are made in-house. In ERPNext, each sub-assembly gets its own BOM, and the finished product's BOM lists the sub-assembly as an item. You build the BOMs from the bottom up. Our guide to multi-level BOMs in ERPNext walks through this with a worked example.
A submitted BOM cannot be edited. To change it, you copy it, make the change, submit the new version and make it the default. The BOM Update Tool then replaces the old BOM wherever it is used inside other BOMs. This keeps a clear history of what was built from which version.
A work order says "make this many of this item, using this BOM". You can create one by hand, from a sales order or from a Production Plan.
Each work order has three warehouses:
The usual flow is a Material Transfer for Manufacture stock entry to move material to work in progress, then a Manufacture stock entry when the goods are finished. The Manufacture entry consumes the raw materials and adds the finished goods to stock. In Manufacturing Settings, you choose whether raw materials are consumed based on the BOM or on what was actually transferred.
On a work order, the "Use Multi-Level BOM" option pulls in the raw materials of every sub-assembly, so one work order makes the finished item straight from raw materials. This suits sub-assemblies that are never stocked on their own. If you want to make, track and stock sub-assemblies separately, use a Production Plan instead.
Production Plan is where planning happens. You pull in open sales orders or material requests, and ERPNext works out what to make and what to buy.
A typical run:
This replaces the planning spreadsheet that most plants keep beside Tally.
When a BOM has operations, submitting a work order creates a job card for each operation. Operators or supervisors log start and end times and the quantity completed against each job card. Workstation hourly rates turn that time into operating cost.
Job cards are useful when you need to know where a job is, who worked on it and how long each step took. If your plant does not need that detail yet, you can leave operations off and add them later.
Many Indian manufacturers send material out for plating, machining, painting or assembly. In current ERPNext, subcontracting works like this:
ERPNext tracks the material held at each supplier, so you can see what is out with whom. Native subcontracting needs a separate subcontracted item for each outsourced stage, so item masters can multiply quickly when a part goes out for several operations. Where that gets heavy, we build a simpler vendor job-work card in a custom app instead.
ERPNext handles quality with inspection templates and Quality Inspection documents:
Plants with strict incoming quality control often need more than the standard forms. For OKHAE Electronics, we built a custom IQC module with inspection parameters and alerts for failures. The electronics manufacturing guide covers IQC, in-process and outgoing checks in more detail.
Good manufacturing data depends on good stock data. Set up:
If the finished product's BOM is created before its sub-assembly BOMs, the costing and planning are incomplete. Start with the lowest level.
If scrap is not in the BOM's Secondary Items table, it never comes back into stock, and the cost of the finished product is overstated.
One warehouse for everything hides where stock is. A warehouse for every rack makes every transaction slow. Match the warehouses to the places where responsibility changes hands.
Job cards only help if someone fills them in. If the shop floor will not log time yet, start without operations and add them once the basic flow is working.
ERPNext lets you make a Manufacture stock entry directly. For a simple assembly line that can be a sensible choice, but make it on purpose: without work orders you lose the link to planning, material issue and job cards.
Customisations made by editing ERPNext's code break on upgrade. Put them in a custom Frappe app instead.
Yes, for most small and mid-sized discrete manufacturers. BOMs, work orders, Production Plan, job cards, subcontracting, quality inspection and batch tracking are all part of standard ERPNext.
A work order makes one item from one BOM. A Production Plan looks at sales orders or material requests, then creates the work orders for finished goods and sub-assemblies and the material requests for anything you need to buy.
Yes. Each sub-assembly has its own BOM. A Production Plan creates separate work orders for sub-assemblies, or "Use Multi-Level BOM" on a work order pulls their raw materials into one work order.
Yes. Current ERPNext uses a purchase order for the service, a Subcontracting Order, a stock entry to send materials and a Subcontracting Receipt to book finished items back in.
Often a little. Standard ERPNext covers the core flow. Plants with strict quality processes, machine connections or unusual costing often need a custom Frappe app on top.
Book a walkthrough of ERPNext set up for a plant like yours.
In a free 30-minute call we map your process and tell you plainly what would change, whether that is Tanush LIMS, ERPNext or something built for you. We reply within 24 hours.