SERVICE ITEM
A service item is an item we create to track time and record billable hours. Though they are a specific item type, service items belong in their own category. A service item describes non-tangible services that our company buys or sells like cleaning or software consulting. Service item records in NetSuite are necessary in order to track things like time and billable hours. As with non-inventory items, there are three categories of service items: services for sale, services for purchase, and services for resale.
• Services for Purchase – services our business buys but doesn’t sell to customers [Services for purchase would be services that our company purchases from another business without intending to sell the service. For example, maybe we pay a cleaning company to clean our office once a week. This would be a service that we only purchase.]
• Services for Resale – services our business buys and then sells to customers; it is used to track charges for a service our business pays for initially and then bills to a customer. [ A service for resale would be a service that we buy from an outside source and then sell to our customers.]
• Services for Sale – services our business sells but doesn’t buy [Services for sale are services that the employees of our company provide for our clients. We don’t buy these services first, because our own employees perform the services. We only sell the service to our clients.]
Examples of Service Items:
• Consulting services
• Installation services
• Sub-contracting services
• Packaging services
• Delivery services
• Postal and courier services
• Repairing and maintenance services
NON-INVENTORY ITEM
We can record and track items that we always drop ship as non-inventory items. We can also record and track other items that we sell or purchase but do not stock as non-inventory items. The following are types of non-inventory items:
• Non-inventory items for sale – can be bought, sold, and consumed but are not added to a purchase order or kept in inventory. Non-inventory items for sale can only be sold to customers and entered on customer-facing transactions, such as sales orders, cash sales, or invoices. [ Refers to those items that are not housed in our inventory and cannot be
added to a purchase order, but these items can be added to sales orders, cash sales, or invoices.]
• Non-inventory items for purchase – can only be bought and entered on vendor-facing transactions such as purchase orders and vendor bills. These items are purchased by our organization but not resold, such as office supplies. [Physical items that our company needs to run its various operations, but these aren’t items that we will sell to our customers. For example, office equipment and office supplies would be non-inventory items for purchase.]
• Non-inventory items for resale – can be bought and sold and appear on all applicable transaction types. This includes drop-ship items that we do not store but sell directly from the vendor. [Items that our company would both purchase and sell, but they never enter our inventory. Drop-ship items would fall into this category. Drop-ship items are items that we sell to our customers, but they go directly from our vendor to our customers, without ever passing through our inventory.]
Examples of Non-Inventory items:
• Stationery items [provided the business is not a stationery business.]
• Drop-ship items by E-commerce ventures
• A company could also buy a few desk chairs from a third-party supplier
at the end of an office renovation project and then roll them out into its
customer’s new offices upon receipt.
• Made-to-order items
• Furniture [provided the business is not a furniture business]
TAX ITEMS
An item on which tax is applicable is called a tax item. We cannot configure an item as a tax item on creation. We can only treat it as a tax item during a transaction in the Tax Information section by checking the Taxable box in the Accounting tab and configuring the tax code and tax rate. Similarly, we can configure taxability for customers under the Financial tab by checking the Taxable box and entering the relevant details.