Fixed Service Commitment Term
In software retail business, it is common to purchase a license from the manufacturer as a full version (initial sale). Subsequent renewals and extensions (e.g. for updates) are sold afterwards. Such contracts usually have a fixed term, e.g. one year, and are not automatically renewed. The retailer or customer is responsible for monitoring this, not the software manufacturer. However, the renewal must be initiated. The Fixed Service Commitment term is used to map such contractually defined terms.
The Service Commitment Option field on the Item Card (in the Prices and Sales fast tab) provides, among others, the option Fixed Service Commitment Term. An item marked liked this requires a start and end date of the Service Commitment to be specified when used or processed.
Service Commitments with a fixed term are valid for a certain period. They end automatically at the agreed date.
Service Commitments with a fixed term
The Service Commitment Package used for a fixed term are set up in the same way as normal Service Commitment Packages. However, the Fixed Service Commitment term indicator must also be set in the Service Commitment Package.
Only one Service Commitment Package can be defined for use for fixed terms.
Use of items with Fixed Service Commitment Term
If an item with Fixed Service Commitment Term indicator set is used in a Sales line, the Service Commitment Package with the Fixed Service Commitment Term indicator is automatically applied.
The item cannot be shipped unless the Term Start Date and Term End Date fields have been filled in the Sales line. The dates are then interpreted as Service Start Date and Service End Date when the Service Commitments are generated.
As these are usually retail items, Purchase Orders can be used to procure them from the supplier or manufacturer. Before the Purchase Order is posted (items receipt), the system requires the Term Start Date and Term End Date to be specified (in the Purchase Order line). With the posting of the shipment, the dates is transferred to the related Sales line.
Once the Sales Order with a Fixed Service Commitment Term item is shipped, a new Service Object is created.
This procedure is compatible with both Warehouse Shipments and simple, order-related Purchase Orders. In addition, Drop Shipments (Business Central Standard - without Warehouse Shipments and DYCE - with Warehouse Shipments) are also supported.