Skip Headers

Oracle Service Contracts User Guide

Release 12.1
Part Number E13458-04

Content Previou Nex

s
s
t

Creating Contract Items in Oracle Inventory

This chapter covers the following topics:

About Contract Item Types

Creating Service Items

Creating Warranty Items

Creating Subscription Items

Creating Usage Items

Defining Serviceable Products

Restricting How Items Are Used

About Contract Item Types

This group of topics explains how setup items in Oracle Inventory for use
in contracts.
Whether a contract is authored in Oracle Service Contracts or created
automatically from Oracle Order Management or Oracle Installed Base, a
contract must include lines.
The line types used in a contract are items that are created in Oracle
Inventory. For example, a computer manufacturer could set up an service
item WR23763, to cover the Extended Notebook PC Service Plan.
Items are classified into four contract item types: service, subscription,
usage, and warranty. How you classify these items restricts which contract
categories can use them. See Restricting How Items Can be Used.
Because an item must be defined as a serviceable item to be covered on a
contract, you must also ensure that the Item Master contains serviceable
items. See Defining Serviceable Products.

Creating Service Items

Services are items that you define in the item master. They include the
coverage terms that are given or sold to a customer.
You must define service items in the item master.
This procedure highlights an example of how a service item can be set up.
For additional information about setting up product items in Oracle
Inventory, refer to the Oracle Inventory User's Guide.
For information about entering service lines, see About Service Lines.
Prerequisite
Confirm that a Coverage Template is defined. See Defining a Coverage
Template.

To create a service item:

1. Open Oracle Inventory and navigate to Inventory. Select Items,
and then select Master Items.
2. If prompted, enter an Organization.
The Master Items window appears.
3. Enter an item.
4. Enter a description.
5. From the Main tab:
a. Select the User Item Type, Service Pgm / Warranty.
b. Select a unit of measure (UOM), from the Primary LOV.
Note: You set up a service using a time UOM, such as Year,
not a quantity UOM, such as Each.

6. Select the Order Management tab:

a. Select the Customer Ordered check box.

The Customer Orders Enabled check box is automatically

selected.
b. Select the OE Transactable check box.
c. Select the Internal Ordered check box.
The Internal Ordered Enabled check box is selected
automatically.
7. Select the Invoicing tab:

a. Select the Invoiceable Item and Invoice Enabled check

boxes
o Select the Service tab.

a. In the Contract Item Type, select Service from the LOV.

b. Select a Duration and Duration Period.
The duration and duration period are used for passing the
service duration for the service item, when it is selected in the
Oracle Quoting application.
c. From the Template LOV, select a coverage template.
b. Save.

Creating Warranty Items

Warranties are services that are given to the customer free of charge. The
price is assumed to be included in the price of the associated product.
You must define warranty items in the item master.
This procedure highlights an example of how a warranty item can be set
up, for additional information on setting up product items in Oracle
Inventory refer to the Oracle Inventory User's Guide.
For information about warranties, see About Ordering Service in Oracle
Order Management.

This table distinguishes between warranties and services. Extended

warranties are considered services:
Warranties

Services

Non-orderable and managed automatically

Can be sold on a quote,

order, or service
contract.

Cannot be authored, can only be created when

products under warranty are sold from Oracle
Order Management or are manually created in
the Install Base

Can be authored or
created through the
Order Management
interface.

Do not have a price

Has unit or percentage

based pricing.

Associated with serviceable items in Bill of

Materials (BOM)

Not included in a bills of

material (BOM).

Have warranty inheritance rules

Do not have warranty

inheritance rules.

Cannot be renewed, can be extended or

terminated

Can be renewed,
extended, or terminated.

Prerequisite
Confirm that a Coverage Template is defined. See Defining a Service
Coverage.

To create a warranty item:

1. Open Oracle Inventory and navigate to Inventory. Select Items,
and then select Master Items.
2. If prompted, enter an organization.
The Master Items window appears.
3. Enter an item.
4. Enter a description.
5. On the Main tab, select the User Item Type, Service
Pgm/Warranty.

6. Select the Order Management tab:

o Select the OE Transactable check box.

7. Select the Invoicing tab:

o Select the Invoiceable Item and Invoice Enabled check

boxes.
8. Select the Service tab.

o In the Contract Item Type, select Warranty from the LOV.

o Select a Duration and Duration Period.
o From the Template LOV, select a coverage template.
o You may enter Starting Delay (Days) for the Serviceable items.
For serviceable items that are covered by Warranty, you can
enter Starting Delay (Days), which will affect the start date for
the contract. The start date for the contract is equal to the
ship date plus the value entered in the Starting Delay (Days)
field. The same date is also used by Oracle Installed Base as
the installed date of the product.
For information on modifying warranty dates, see Modifying
the Dates a Warranty Is Effective.

b. Save.
Note: After a warranty is defined, it must be associated with a
serviceable product in the Bill of Materials for a warranty contract to
be automatically created. Refer to the Oracle Bills of Material User's
Guide for further information.
When a product is shipped or manually created in the installed base,
the warranty is automatically created in Oracle Service Contracts.
Warranties allow a support service to be associated with a product
automatically. The warranty is automatically associated with the
customer product in the installed base upon ordering and fulfillment
of the product to the customer.
Each serviceable product can be fulfilled with one or more base
warranties defined as components in the BOM for the product.
c. Select the Enable Contract Coverage check box.
This makes the product serviceable. The Track in Installed
Base check box is automatically selected.
d. If defects for this item are to be tracked, then select the Enable
Defect Tracking check box.
e. Select the Enable Service Billing check box.

f. Select the Billing Type field. For example, Material, Labor, or

Expense.
g. Select the Recovered Part Disposition speed.
This indicates if replaced parts are to be recovered and how quickly.
h. Save.

Creating Subscription Items

For subscription items to be priced and sold on a contract, they must be
defined in the item master.
A Subscription Item Type can either be selected as a contract line item on
subscription agreement, or as a subline to a service line.

When a subscription is on a line, you are selling that subscription.

An example is a magazine subscription, delivered once per month
for a year.

If you want to sell service that provides coverage on a subscription,

an example is a subscription used to track the duration that a user
has access to a web based service. The service coverage on that
subscription would be used to provide support if the customer has
problems with the service, such as a login issue.

This procedure highlights an example of how a subscription item can be

set up, for additional information on setting up product items in Oracle
Inventory refer to the Oracle Inventory User's Guide.
For information on entering subscription lines, see About Subscriptions.
Prerequisite
Confirm that a Subscription Template is defined. See Setting Up a
Subscription Template.

To create a subscription item:

1. Open Oracle Inventory and navigate to Inventory. Select Items,
and then select Master Items.
2. If prompted, enter an Organization.
The Master Items window appears.
3. Enter an Item.

4. Enter a Description.
5. From the Main tab, select the User Item Type.

6. Select the Order Management tab:

a. Select the Customer Ordered check box.

The Customer Orders Enabled check box is automatically

selected.
b. For tangible subscriptions, select the Shippable check box.
c. Select the OE Transactable check box.
d. From the Contract Item Type LOV, select Subscription.
e. Select the Subscription Template that should be associated
with this item.
This defines the fulfillment schedule defaults.
Note: You must select a Subscription template. If you do not
select a template, the subscription cannot be used on the
authoring form, it will display an error.
7. Select the Invoicing tab.

a. Select the Invoiceable Item and Invoice Enabled check

boxes.
o Select the Service tab:

a. To enable the ability to file service requests against this item,

select Enabled from the Service Request list.
b. Select the Enable Contract Coverage check box to identify
this product as being serviceable.
The Track in Installed Base check box is automatically
selected.

c. From the Contract Item Type LOV, select Subscription.

d. Select the Subscription Template that should be associated
with this item.
This value defines the fulfillment schedule defaults.
Note: You must select a Subscription template. If you do not
select a template, the subscription cannot be used on the
authoring form, and an error appears.
b. Save.
The subscription item is now an inventory part as well as a
serviceable product.

Creating Usage Items

For usage items to be priced and sold on a contract, they must be defined
in the item master. Usage includes things such as the number of copies
made on a printer or the number of calls made to Support.
This procedure highlights an example of how a usage item can be set up,
for additional information on setting up product items in Oracle Inventory
refer to the Oracle Inventory User's Guide.
For information about entering usage lines, see About Charging a
Customer for Usage.

To create a usage item:

1. Open Oracle Inventory and navigate to Inventory. Select Items,
and then select Master Items.
2. If prompted, enter an Organization.
The Master Items window appears.
3. Enter an Item.
4. Enter a Description.
5. From the Main tab, select a User Item Type.

6. Select the Order Management tab.

a. Select the Customer Ordered check box.

The Customer Orders Enabled check box is automatically
selected.
b. Select the Internal Ordered check box.
c. The Internal Orders Enabled check box is automatically
selected.

7. Select the Invoicing tab.

a. Select the Invoiceable Item and Invoice Enabled check

boxes.
o Select the Service tab.

a. In the Contract Item Type, select Usage from the LOV.

b. Save.

Defining Serviceable Products

To be covered by a service item, subscription item, warranty item, or
extended warranty item, a product item must be classified as a
serviceable product.
Prerequisites
Confirm that the product items exist in Oracle Inventory.
For additional information on setting up product items in Oracle Inventory,
refer to the Oracle Inventory User's Guide.

To define a serviceable product:

1. Open Oracle Inventory and navigate to Inventory. Select Items,
and then select Master Items.
The Master Items window appears.
2. Query an item.
a. From the View menu, select Query By Example and
then Enter.
b. Enter a value in the Item field, for example %AS5%.
c. From the View menu, select Query By Example and
thenRun.
The queried item appears in the form. Click the arrow to see
additional items that match your query.
3. Select the Service tab.

4. To enable the ability to file service requests against this item,

select Enabled from the Service Request list.
5. Select the Enable Contract Coverage check box.
This selection makes the product serviceable. The Track in
Installed Base check box is automatically selected.
6. If defects for this item are to be tracked, then select the Enable
Defect Tracking check box.
7. Select the Enable Service Billing check box.
8. Select the Billing Type field. For example, Material, Labor, or
Expense.
9. Select the Recovered Part Disposition speed.
This value indicates if replaced parts are to be recovered and how
quickly.
10.

Save.

The product item is now a serviceable product.

Restricting How Items Are Used

Contract categories restrict the line types that can be added to a contract.
Accordingly, how you classify an item in Oracle Inventory impacts which
contract categories can use the item.
This table shows the contract line items that can be used by each of the
contract categories.
Warranty
(automatically
generated
from Oracle
Order
Management)
No

Contract
Line Item

Service
Agreement

Warranty
Subscriptio and
n
Extend
Agreement Warranty

Service
contract
item type

Yes

Yes

Yes.
Line Type
indicates
Extended
Warranty
rather than
Service.

Subscriptio Cannot be
n contract used as a
item type
contract line,
but can be
used as a
subline

Yes

Cannot be
No
used as a
contract
line, but can
be used as
a subline

Usage
contract
item type

Yes

Yes

No

No

Warranty
contract
item type

No

No

No

Yes

Contents | Previous | Top of Page | Next

Copyright 2005, 2010, Oracle and/or its affiliates. All rights reserved.