Converting Non-Inventory Items to Inventory Items

Access Level: Administrator, Inventory Manager

Overview

This guide outlines the step-by-step process for converting Non-Inventory Items to Inventory Items in NetSuite. This is commonly required for items like repackaged goods, kits, or products transitioning to stocked inventory.

Pre-Conversion Checklist

Before converting, ensure:

✅ Stock Quantities Are Verified – Confirm current on-hand quantities for accurate inventory tracking.

✅ COGS/Asset Accounts Are Defined – Map the correct accounts for accounting impact.

✅ Vendor/Sourcing Details Exist – Required for replenishment and procurement.

✅ No Open Transactions – Complete or void open orders/fulfillments for the item.

Step-by-Step Conversion Process

1. Verify Current Item Setup

• Navigate to:
• Lists > Accounting > Items > [Non-Inventory Item]
• Confirm:
• Item Type: “Non-Inventory for Sale” or “Non-Inventory for Resale”
• Subsidiary Restrictions: Ensure compatibility with target subsidiaries.

2. Record Key Data

Note the following for the new inventory item:

• Description, Vendor, Pricing, GL Accounts (COGS, Asset, Income).
• Custom Fields: Transfer any custom data (e.g., UPC, Serial/Lot tracking needs).

Step 3: Convert Using NetSuite’s Standard Button

Instead of creating a new item manually, use NetSuite’s built-in conversion feature:

1. Navigate to the Non-Inventory Item Record:

• Go to:
• Lists > Accounting > Items
• Search for and open the non-inventory item you want to convert.

1. Click “Convert to Inventory Item”:

• This standard NetSuite button appears on non-inventory item records.
• The system will automatically preserve:
• Item description, vendor info, and pricing
• Custom field values
• Subsidiary restrictions

1. Review and Confirm Settings:

• Verify the GL accounts (COGS, Asset, Income) are correctly mapped.
• Enable inventory management features (bins, lots, serials) if needed.

1. Save the Converted Item:

• The original non-inventory item becomes inactive automatically.
• All future transactions will use the new inventory item.

Key Advantages of This Method

✔ Preserves Data Integrity – No manual recreation of item details.

✔ Maintains Links – Existing transactions remain associated correctly.

✔ Audit-Friendly – Clear trail of the conversion in item history.

Note: If the “Convert to Inventory Item” button is missing, verify:

• Your role has Full permissions for Lists > Items.
• The item isn’t used in open transactions.

4. Update Stock Quantities

• Navigate to:
• Transactions > Inventory > Inventory Adjustment
• Select the new inventory item and enter the verified on-hand quantity.
• Assign Location/Subsidiary and Cost.

Post-Conversion Steps

1. Test Transactions:

• Create a Sales Order/Purchase Order to validate the new item.

1. Update Integrations:

• Adjust EDI/API mappings if the item is synced with external systems.

1. Train Teams:

• Inform warehouse/sales teams about the new SKU.

Common Pitfalls & Fixes

Issue Solution

Quantity Discrepancies Verify inventory adjustments match physical counts.

GL Account Errors Reconcile COGS/Asset accounts post-conversion.

Open Order Conflicts Void or migrate open transactions manually.

FAQ

Q: Can I convert back to a non-inventory item later?

A: No—create a new non-inventory item and adjust stock if needed.

Q: What happens to historical data?

A: Non-inventory item records remain but won’t affect new inventory tracking.

Conclusion

Converting non-inventory items requires careful planning to ensure accurate stock tracking, accounting, and process continuity. Always test in Sandbox first!