ERP Setup

Configure the ERP foundation — company, master data and finance — on Desk and the App.

Most of what follows is created automatically by the install wizard. Your job here is to review and confirm, not rebuild — a few of these choices (currency, fiscal year) are permanent once you post your first transaction.

Warning

Currency and fiscal year are effectively permanent. Once you post your first transaction you can't change the company's base currency, and every entry is locked to a fiscal year. Confirm both before you record anything.

How to navigate: every screen has a search bar at the top (the "awesome bar"). Type the name of any record to open it (e.g. Company, Item), or type New Item to create one. Each step below gives you the term to search.

Work top to bottom and tick each box as you go.

Company and accounting

The legal and financial backbone. Everything else hangs off the Company record.

[ ] Confirm the Company — search Company, open the one the wizard created. Check Abbreviation (appended to every account/warehouse, e.g. Cash - GF — keep it short), Country (sets your default accounts and taxes) and Default Currency. Why: country and currency are effectively permanent — currency can't change once transactions exist. One Company per legal entity.
[ ] Set the Fiscal Year — search Fiscal Year. Match the start/end to your statutory year (not always Jan–Dec). Why: every entry is stamped to a fiscal year; this drives period-close and your financial statements. Fix it before posting anything.
[ ] Review the Chart of Accounts — search Chart of Accounts for the tree. The standard structure (Assets, Liabilities, Income, Expenses, Equity) is generated from your country. Rename or add ledger accounts to match how you think about the business (e.g. split sales by product line). Mark headings as Group, posting accounts as Ledger. Why: far easier to shape now — once an account has entries you can only disable it, never delete it. Don't over-build; add accounts as you need them.
[ ] Set up Taxes — search Sales Taxes and Charges Template and Purchase Taxes and Charges Template. Create one template per tax scenario (e.g. standard VAT/IVA, exempt). Add Tax Categories if different customers are taxed differently. Why: templates auto-fill the right tax lines on every invoice — consistent, audit-ready, no manual tax entry per document.
[ ] (Optional) Cost Centers — search Cost Center. Add one per department, branch or line if you want profit/cost broken down that way. Why: lets you report margin by area, not just company-wide.

Items and inventory

Your materials, finished goods and where stock lives.

[ ] Item Groups — search Item Group. Build a simple tree: e.g. Raw Material (Fabric, Trims, Thread), Finished Goods (by style or category). Why: groups drive reporting, default accounts and filtering everywhere items appear.
[ ] Units of Measure — search UOM. Confirm the units you actually use (Meter, Kg, Piece, Dozen, Roll). Set UOM Conversion Factors on items that are bought and sold in different units. Why: prevents the classic "bought in rolls, issued in meters" mismatch.
[ ] Items — search New Item. Fill Item Code, Item Group, Default UOM. Set Maintain Stock on for physical goods (off for services). Add purchase/sell rates if known. Why: the item master feeds every transaction — BOMs, orders, invoices, stock.
[ ] Warehouses — search Warehouse. Model your real storage and work-in-progress locations (e.g. Fabric Store, Cutting WIP, Sewing WIP, Finished Goods). Why: accurate warehouses = accurate stock value and shortage visibility at each stage.
[ ] Valuation method — set on the item or in Stock Settings. Choose FIFO or Moving Average and apply it consistently. Why: determines your cost of goods sold and inventory value — switching later distorts comparisons.

Customers and suppliers

The parties you trade with, and the terms you trade on.

[ ] Customer & Supplier Groups — search Customer Group / Supplier Group. Group by segment (e.g. Wholesale, Retail, Export) and Territory if you sell across regions. Why: drives default pricing, credit terms and sales reporting.
[ ] Customers — search New Customer. Add Customer Name, Group, Territory, and a default Currency if they pay in another. Attach Address and Contact records. Why: one clean party record feeds quotes, orders, invoices and statements.
[ ] Suppliers — search New Supplier. Same idea — name, group, currency, address, contact. Why: powers purchase orders, supplier invoices and payables.
[ ] Payment Terms — search Payment Terms Template. Define your standard terms (e.g. Net 30, 50% advance / 50% on delivery) and assign them to parties. Why: auto-sets due dates and instalments, so receivables/payables aging is correct without manual edits.

Finance basics

The day-to-day cycle: bill, get paid, report.

[ ] Raise a Sales Invoice — search Sales Invoice. Pick the customer, add items (taxes auto-apply from your template), submit. Why: this is the document that books revenue and creates the receivable.
[ ] Record a Purchase Invoice — search New Purchase Invoice. Pick the supplier, add items, submit. Why: books the expense/stock and creates the payable.
[ ] Register Payments — search New Payment Entry (or use Payment from the invoice). Match the payment to its invoice. Why: clears the outstanding balance and keeps customer/supplier ledgers accurate.
[ ] Add Bank Accounts — search Bank Account, then use Bank Reconciliation periodically. Why: reconciling against the statement is how you catch missed or duplicate entries.
[ ] Check your reports — search Profit and Loss Statement, Balance Sheet, Accounts Receivable, Stock Balance. Why: if the setup above is right, these are accurate from day one — your live picture of the business.

AI Guided Configuration

The steps above are deliberately generic. The parts that aren't — tax rates, local accounts, statutory fiscal year, payroll deductions — depend on where you operate. An AI assistant (ChatGPT, Claude, Gemini) is a fast way to draft that country-specific detail.

Copy the prompt below, fill in your country, and paste it into your AI tool. It's written so the AI coaches you step by step — you move forward together rather than getting one giant wall of text:

You are my setup guide for ERPNext v16 (with Frappe HRMS v16). Coach me through it
ONE STEP AT A TIME — explain a step, ask me anything you need, wait for my reply,
then move to the next. Don't dump everything at once.

About me:
- I run a GARMENT MANUFACTURING business in [YOUR COUNTRY].
- I'm the owner/administrator — I know my business well but I'm new to ERPNext.
- Infer my likely currency and the standard statutory fiscal year from my country,
  and confirm both with me before we rely on them.

Work through these together, in order:
1. Company & fiscal year — confirm currency and the statutory financial year.
2. Chart of Accounts — propose any local accounts beyond ERPNext's default, then
   GENERATE A FILE I CAN UPLOAD with ERPNext's Chart of Accounts Importer, so I
   don't build it by hand. Use the columns the importer expects: Account Name,
   Parent Account, Account Number, Is Group, Account Type, Root Type.
3. Taxes — which tax applies to garment manufacturing and sales here
   (VAT/GST/IVA/etc.), typical rates, and how to set them up as Sales/Purchase
   Tax Templates and Tax Categories.
4. Payroll & HR (Frappe HRMS v16) — statutory deductions, employer contributions
   and salary components I must configure for employees here.
5. Anything country-specific a garment manufacturer commonly misses.

Rules:
- One step at a time; check I've finished a step before moving to the next.
- Be concrete and map each step to the actual ERPNext/HRMS screens.
- Where rules vary or you're unsure, SAY SO and tell me to confirm the exact
  figures with a local accountant — don't guess at rates.