Units of Measurement

Units of measurement are the language of inventory. When you say you have "500" of an item in stock, the obvious question is: 500 what? Kilograms? Pieces? Litres? Metres? Without a standardized unit system, inventory records become ambiguous, purchase orders lead to disputes, and production planning falls apart.

In Udyamo ERP Lite, every item is linked to a unit. This chapter explains how to set up and manage units of measurement for your manufacturing business.

What You Will Learn

• Why standardized units of measurement matter in manufacturing ERP
• Common units used in Indian manufacturing
• The concept of base units
• How to create and manage units in Udyamo ERP Lite
• Practical considerations for unit selection

Prerequisites

• Udyamo ERP Lite is set up with your organization details (Chapter 5)
• You have Owner or Admin role access

Why Standardized Units Matter

Consider a simple scenario: your purchase team orders "100 MS rods" from a vendor. The vendor ships 100 kilograms of MS rods. The purchase team expected 100 pieces. The discrepancy causes delays, incorrect billing, and frustration on both sides.

This is not a hypothetical example. Unit mismatches are among the most common sources of error in manufacturing operations. A robust ERP system enforces a single, unambiguous unit for every item, and that unit is used consistently across all transactions — purchases, production, sales, and stock records.

Standardized units also enable:

• Accurate stock valuation — You cannot calculate the value of stock if the quantity is ambiguous
• Reliable consumption tracking — Production must consume materials in the same units they are stocked
• Consistent reporting — Inventory reports, purchase summaries, and sales analytics all depend on comparable units
• GST compliance — Invoices and e-way bills require quantity in a recognized unit

Common Units in Manufacturing

The following table lists units frequently used by Indian manufacturing businesses:

Tip: You do not need to create every possible unit upfront. Start with the units you will use immediately — typically 8 to 12 units cover most manufacturing needs. You can always add more later.

Base Units

In Udyamo ERP Lite, each unit has a Base Unit flag (boolean). A base unit is one of the fundamental measurement types in your system. For example, kg might be your base unit for weight, ltr for volume, and pcs for count.

Marking a unit as a base unit serves as a reference point. When you have multiple units in the same measurement family (kg and g, ltr and ml), the base unit flag identifies the primary unit. This distinction is useful for future unit conversion features and reporting.

Tip: For most manufacturing businesses, marking kg, ltr, mtr, pcs, and sq.m as base units is a sensible starting point.

Step-by-Step: Creating Units

Creating a Base Unit (Kilogram)

1. Navigate to Inventory > Units
2. Click Add New
3. Fill in the fields:
   • Name: Kilogram
   • Abbreviation: kg
   • Base Unit: Enabled
4. Click Save

Creating Additional Units

Repeat the process for each unit your business needs. Here is a recommended initial set:

Required: You must create at least one unit before you can create items (Chapter 7). If you are setting up the system for the first time, create your units first.

Unit Selection Guidelines

Choosing the right unit for each item requires thought. Consider the following:

Match Your Procurement Unit

If you purchase MS rods by the kilogram, set the unit to kg. If you purchase bearings by the piece, set the unit to pcs. The item's unit should match the most common unit used in purchase transactions.

Match Your Consumption Unit

If production consumes steel in kilograms, the unit should be kg. If the production team draws 5 pieces of a component per assembly, the unit should be pcs. Ideally, procurement and consumption use the same unit.

When Procurement and Consumption Units Differ

Occasionally, you may buy in one unit and consume in another — for example, purchasing paint in litres but consuming it in millilitres, or buying wire in rolls but consuming it in metres. In such cases, choose the unit that is most practical for day-to-day operations. If you consume in ml but buy in ltr, consider whether tracking in ltr at a higher level is sufficient, or if ml-level precision is genuinely needed.

Avoid Ambiguity

"Piece" and "Number" are often used interchangeably. Choose one convention and stick with it. If your business uses "nos" on all invoices, make that your standard count unit. Consistency prevents confusion.

Tips & Best Practices

Tip: Create all your units before entering items. This avoids the interruption of having to create units mid-way through item setup.

Tip: Keep abbreviations short and consistent. Use lowercase abbreviations (kg, ltr, pcs) as they are easier to read in tables and reports.

Warning: Once a unit is assigned to items and transactions exist, changing the unit on an item can cause inconsistencies. Choose units carefully during initial setup. If a correction is needed later, it is better to create a new item with the correct unit and retire the old one.

Tip: If your business exports goods, check whether your units align with international standards. The metric system (kg, ltr, mtr) is universally understood. Non-standard units like "bundle" or "box" may need clarification on export documentation.

Quick Reference — Unit Fields