AX 2012 Product Categories

AX 2012 Product Categories

Product Category in AX 2012 is very powerful feature which used to classify products for the reporting purpose and analysis. Categories can be defined as per Organizational needs. In AX 2012 there is no limit on number of levels in a given Category Hierarchy. Once Category is defined it is attached to a product and it is pulled up on all the Purchase / Sales transactions. Hence it enhances the reporting capabilities for an enterprise.

Organization can create as many categories as required, however there could be only one active category associated to type at a given point in time.

Each Level in categories is called as Category Node. Nodes are further classified to Parent Node and Child Nodes.

Category Hierarchy linked to the Category Type. AX 2012 allows defining 3 types of Product categories such as “Procurement Category Type”, “Sales Category Type” and “Commodity Code Type”.

1)    Procurement Category Type – Used in procurement module such as Purchase Requisition, Purchase Orders.

2)    Sales Category Type – Used in Sales Module such as Sales Quotation, Sales Orders.

3)    Commodity Code – Used for compliance and customs purpose can also be used to define product harmonized codes for export & import purposes.

Note:- One should be very careful while defining the product category Hierarchy as once it is defined it cannot be changed or re-adjust to the other parent categories. Only option left is to delete the category node and re-create on the desired parent / child node.

Once created, all categories and nodes are inactive. There is an activate button in the ribbon at the top of the form where a category can be activated. When a child category is activated, parent categories are automatically activated along with it.

Categories can hold information such as Commodity Codes, and Attributes. These attributes are specific to each category (or inherited from a parent) and are added to a category from a list of user created attributes. Category pages can be added as well. Pages can contain information about the type of product in a category, images of the product in the category and announcements for discounts and sales available for that category.

Some of the uses of categories other than reporting and analysis are to setup what vendor products in a particular category must be purchased from as well as setting up specific product attributes for products in a category. Questionnaires can also be setup for a particular category that would typically be sent to a vendor for evaluating their capabilities. Policies can also be created for a category hierarchy that will manage access to products in the category and rules for ordering products in that category.

Following is the outline on the category structure supported by AX 2012.

Product Categories

Category Hierarchy – is the master under which category nodes are created. Category Hierarchy is associated to the Category Type. There is no limit to creation on number of category hierarchy. Organizations can create several category hierarchies and attached to a specific category type such as Purchase, Sales.

Note:- Only one active product category Hierarchy can be attached to a type at a given point in time. Once Hierarchy is associated to Type it cannot be changed.

Parent Category Nodeis the only parent node to which multiple child nodes can be created. There cannot be more that one Parent nodes under category hierarchy. By default all nodes are created as a child to a parent node. Therefore as best practices it is advisable to define Parent node as similar to Category Hierarchy.

Child Node – All nodes created under the parent are called as Child nodes. Child nodes can be under different hierarchy as show in above diagram. Organization can define as many child nodes as per individual requirement and there is no limitation to the number of levels.

All of the above nodes have some common characteristics such as

a)    Category Attributes

b)    Commodity Codes

c)     Category Pages

d)    Project Categories.

1)   Category Hierarchy Creation

 Step 1 – Category Hierarchy can be created through the New Category option under

Product Information Management – Setup – Categories – Category Hierarchy


Step 2 – In Category Hierarchy Form Click on drop down next to Category Hierarchy on top Ribbon


Step 3 – Update Category Hierarchy Name Description and Click on Create Button. This will add Category Hierarchy on the Overview.


Step 4 – Upon Create option system shall take you to the Category Hierarchy Details form which will allow you to add Parent & Child Category Nodes.

Note: For the first time you create category hierarchy you will see this form blank with option to create new category Node as shown in figure below.


Also you will notice the created Category Hierarchy appear on the Overview list page.


2)   Category Hierarchy Association to Category Type

Category Hierarchy should be associated with Category type in order to activate for the transactional usage. Following are the conditions to be met while linking the Category Hierarchy to Category Type.

1)    Only one active category hierarchy attached to category type.

2)    Category hierarchy cannot be changed once transactions are created.

Step 1 – To link category Hierarchy to category type please use Associate Hierarchy Type on top ribbon. The right side pane on the Category Hierarchy Overview list shows the list of category type associated with given hierarchy.


Step 2 – Associate Hierarchy form shall display predefined Hierarchy Type and option to select Category Hierarchy.


Step 3  – Following error message will be displayed if any of above conditions is failed.



3)   Category Parent Node

 Step 1 – To Create Parent Category Node Navigate to

 Product Information Management -> Setup -> Categories -> Category Hierarchy

 Select desired category Hierarchy to create a parent Node and click on Edit button on ribbon at the top.


Step 2 – On Create Category Node form click on New Category Node on top ribbon.


A New Parent Category Node will be added by Default.


Update Description, code and save.


 4)   Category Child Node

 Create Child Nodes same as Parent Select the Parent Node under which you would like to create child nodes.


Activate & InActivate Categories.

 To Inactivate category Select the node and click on the Inactivate button on top ribbon. Once category node is Inactivated it shall not appear in any transactions. Also upon inactivating the parent node all child nodes will be inactivated by default.


Click Yes and all sub categories / child nodes will be inactivated. On Inactivated the category node icons will change as shown in below picture.


To Activate Category Nodes select the Inactive node and click on Activate button on Top. While activating users shall have choice to activate only selected category or all sub categories under the parent category.


Upon activation selected category will appear for transactions.


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AX 2012 Product Information Managment

AX 2012 Product Information Management Conceptual Overview

In AX 2012 Item Master is not just a master under the Inventory Management Module. It is part different module called “Product Information Management”. There has been significant change both technically & functionality.

Product information management in AX 2012 targets the creation and maintenance of an Enterprise Products Repository. It supports larger organizations in a centralized structured approach in creating and maintaining core master data such as product definitions. Smaller organizations that require a more decentralized approach can, with some restrictions, create and maintain their products while they are automatically added to the shared products repository.

For e.g. AX 2012 supports following enterprise scenario

As depicted on the above chart is the typical Enterprise Product Lifecycle which determine the following

1)    Enterprise Level Base Product Data

2)    Release Product to Legal Entities

3)    Legal entity Specific Product Master

4)    Finalize Product for Sales / Purchase Transaction

1) Enterprise Level Base Product Data: AX 2012 supports defining the Enterprise Level Base Product Data which includes base definition of the product to identify product uniquely and does not have any variants / pricing component attached to it as it varies at each legal entity level. Base product data act as a central repository for the enterprise and it cannot be used for any sales / purchase / inventory transactions until released to legal entities. As AX 2012 has support for Single world-wide instance Base Product Master can be defined at the corporate level (shared company level in AX 2012) and released to each legal entity on need basis in centralized environment. In Decentralized environment products can be created directly as released products under the legal entities.

AX 2012 classifies Base Product by “Product Sub Type” field under the products screen.

When “Product Sub Type = Product” system allows only following options to be added to product and no variants can be added.

a)    Translations – Product Descriptions & Multi Lingual conversion for description

b)    Dimension Group – Attach Predefined Dimension Group

c)     Product Attributes –  Attach Product Attributes

d)    Product Image

e)    Product Categories

f)     Related Products

g)    Unit Conversions

When “Product Sub type = Product Master” System allows adding additional of variants & dimensions to the product.

h)    Product Variants

i)      Product Dimensions

Note: Please don’t get confused between a ‘Product’ and ‘Product Master’; they are two different product types in AX 2012.

Users can assign Product ‘Dimension Group’ to ‘Product Master’ but can’t assign ‘Dimension Group’ to ‘Product’. ‘Product’ is a unique item which doesn’t have any variants. One should be very careful while defining the product sub type as this cannot be changed after master is defined. Only option will be to delete and re-create the product provided there does not exist any transactions.

Options a to i will be covered in detail on upcoming posts.

Base Product Can be created in a following way

Step 1 – Navigate to Product Information Management -> Common -> Products -> Product or Product Master

AX 2012 classifies Base Product by “Product Sub Type” field under the products screen.

Step 2 – On Products Screen Click on “Product Button” under “New” Section

AX 2012 restricts Base Product Master only to the following options. System does not allow defining any other options such as “Purchase”, “Sell”, “Plan”, “Manage Inventory” etc. We will see about these options in detail on released products section.

2) Release Product to Legal Entities: In AX 2012 Base products can be release to the legal entities on need basis using the Release Product function. When Product is released it is attached to the required legal entity and this authorizes the product setup in a legal entity. System allows releasing single / multiple products at a given point of time. When product is release it is available only to the legal entity however it still cannot be transacted under purchase / sales / inventory.

Products can also be release to more than 1 legal entity. When product is released system allows defining the following options

a)    Purchase

b)    Sell

c)     Manage Inventory

d)    Engineer

e)    Plan

f)     Manage Projects

g)    Manage Costs

h)    Retail

i)      General

Adding above options will make products specific to legal entity. Options a to i will be covered in detail on upcoming posts.

If there is an error during the released product process, the product will be displayed in the Product information management > Open product releases form. For example, you will receive an error if you release a product variant that already exists in the legal entity.

From the Open product releases form, you can view all open product release sessions, view the error, change the session, and initiate the release. A session is deleted if there are no more existing errors. Product can be released to Legal entity on the following way.

Step 1 – Navigate to Product Information Management -> Common -> Products -> Product

Click on Release Products button and select product and product variants to be released. Note:- to release more than 1 product at a time select multiple products and click on release button.

Select companies (Legal Entity) to which product should be released.

Note: Be careful while releasing products to companies (Legal Entity) as once product is released it cannot be un-released or taken back.

Click ok and to have better performance in case of multiple product release please select the batch job and schedule release as part of batch job.

 In Decentralized environments products can be directly created under the released products master by following steps.

Step 1 – Navigate to Product Information Management -> Common -> Products -> Released Product

You will notice lot more fields while creating new released products when compare to Product master. 

 3) Legal Entities Specific Product Master: In AX 2012 products can be specialized by Legal entities by adding several Options to the product.

a)    Purchase – Use this option tab to specialize product for procurement process and includes Purchase Prices, Trade Agreements, View Open Purchase Orders & Supply Overview, Define Invoice Matching policy and price tolerances, Supplementary items and vendor external description, Approved vendors.

b)    Sell – Use this option tab to specialize product for selling process and includes Sales Price, Trade Agreements, ATP Information & Open Sales Orders, customer external description & commission calculation, Supplementary Items.

c)    Manage Inventory – User this option tab to specialize product for Site Settings, Order Settings, Warehouse Items Strategy, Product Bar codes, Quality Management & Non Conformance, Compliance Regulated Products, Restrict Products and Batch Attributes.

d)    Engineer – Use this option tab to specialize product for Manufacturing (Production) purpose such as Bill Of Materials Definition, Bill Of Materials Designer, Formula Definition for process manufacturing, Define Report as Finished & Max Report as Finished.

e)    Plan – Use this option tab to specialize product for Planning purpose such as Supply Schedule,  Forecasting – Demand, Supply & Inventory, Item Coverage, Default Order & Site Settings, Net Requirements & Gross Requirements

f)     Project – Use this option tab to specialize product for managing Projects & Project Costs

g)    Manage Cost – Use this option tab to specialize product for defining the Standard cost for the product, applicable only when product costing model is defined as Standard Cost.

h)    Retail – Use this option tab to specialize product for defining the Retail such as Shelf & Product labels, Linked Products, Check Product for Retail, Competitor prices and Price List.

 i)     General – Use this option tab to specialize product for defining general settings for a product such as Maintain & Manage exception through cases, Share & Send data through AIF, Setup Product Presentations through enterprise Portal.

4) Finalize Product for Transaction: In AX 2012 once products are released it needs to be validated to make sure that it can be used in transactions such as Sales, Purchase & Inventory. When validated system check for the following

 a)    Item Model Group

b)    Item Group

c)     Storage Dimension Group (only for Product Master)

d)    Tracking Dimension Group (only for Product Master)

If any of these fields missing system validates and display error message.

Setup Dimensions Group and validate again.

Dimensions & Model Groups for released product can be applied from Templates.

If Template does not exist, create a new template from any existing items

On Edit Mode Click on Template and enter Template name.

2 types of template can be created

a)    Create Personal Template – Visible Only for current logged in user

b)    Create Shared Template – Visible for all the users among the company.


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