A co-product is an intentional secondary product produced simultaneously with the main product, with both holding significant value. For example, in crude oil refining, gasoline may be produced as the main product, while co-products such as diesel, jet fuel, and lubricants are also obtained. Another example is mold casting, where a mold can produce several parts, such as an engine block and smaller brackets. The engine block would be considered the main product, as it drives the demand for the casting process and holds the highest value, while the brackets would be considered co-products.
A co-product is technically included in the Bill of Material (BOM) of the main product with a negative quantity per assembly. In IFS/Manufacturing Standards co-products are defined with a positive quantity per unit separately from the components on the Produced Parts tab on the Product Structure and Configuration Structure pages. When a shop order is created for the main part, co-products are copied to the Shop Order/Produced Parts tab according to the selected structure revision and alternate.
Co-products can be connected to the operation where it is produced. If not connected, the system assumes it is produced in the last routing step and received together with the main product. If you want to receive co-products together with the reporting of completed quantities and receipts made from the Shop Floor Workbench page, enable the Default Receive Co-Products option on the Site/Manufacturing page.
IFS/Dynamic Order Processing (DOP) does not support the use of co-products.
By selecting the Use as Supply in MRP option for the given co-product, it can be defined as a supply to be used in planning engines like MS and MRP. Furthermore, by enabling Use as Supply in MRP, planning engines will use that co-product supply to meet future demands of the part defined as a co-product.
After creating the shop order from the shop order requisition (created for the parent part), enabling or disabling the Use as Supply in MRP option allows the planner to decide whether to consider using the co-product supply from the shop order in the next MRP/MS run. By default the Use as Supply in MRP option is getting the enabled status from the structure co-product line.
Note: A part cannot be added as a produced part (by-product,
co-product, or disassembly component) if it is already a parent to the main
product. For example, if the produced part has a structure and the main
product is already defined as a component or produced part at a lower level,
you cannot add the part as a produced part unless the Stop BOM
Explosion toggle is enabled in the produced part line of the
structure.
When adding such a part with the Stop BOM Explosion
option enabled, it is crucial to proceed with caution, especially
if the Use as Supply in MRP option is also being used.
One approach is to leave the Use as Supply in MRP option
disabled in the produced part line of the structure and manually enable it
after creating the shop order from a shop order requisition.
Alternatively, if both the Use as Supply in MRP and
Stop BOM Explosion options are enabled, the planning engines will
still identify the produced part supply. However, there may be instances
where the produced part supply generated from supply proposals of planning
engines includes a part that has already been processed in the MRP execution.
Consequently, this planned supply will not be included in the netting
process. Unnetted Planned Supply MS/MRP action message can
be used to identify when such occurrences happen.
The valuation of manufactured products can be determined by using cost distribution factors. The cost distribution factors provide a means of distributing costs of materials, operations and general overhead cost between the main product and the additionally produced parts (by-products, co-products and disassembly components). When not using cost distribution, the valuation of the main product is determined by removing the standard cost of the additionally produced parts from the sum of the material, operation, and general overhead costs.
Shop order cost distribution is described in detail in Shop Order Cost Distribution
Standard cost calculation for co-products is described in Cost Calculation