BC Tip #17 - Item Substitutions in Business Central
- Ben Cole
- Mar 22
- 4 min read
If you have ever had to tell a customer, “Sorry, we don't have that item,” you know how fast momentum can disappear.
The lost sale is not the only impact. This can leave customers feeling frustrated and potentially impact future orders if you cannot get them what they need, and fast.
This is exactly why item substitutions in D365 Business Central matter.
Done right, you can offer an approved alternative instantly, avoid missed opportunities, and keep your customers shelves full and feeling taken care of.
Table of Contents
Why item substitutions are a sales and customer experience win
Shirley Grimes, a client and friend of mine, put it simply: the goal is meeting customer needs with efficiency. If you can swap to a comparable product, you avoid the dead end of “out of stock” and keep the sale alive.
When item substitutions are configured correctly, the benefits show up across the board:
Prevent lost sales when the requested item is unavailable
Keep customers happy by providing a ready-to-go alternative
Increase conversion because you respond creatively vs. systematically
Improve speed and accuracy by showing availability without guesswork
How item substitutions work in Business Central
The concept is straightforward: you define which items can substitute for each other, then apply that logic on sales orders.
Step 1: Set up substitutions on the item card
Start in Business Central on the Item card:
Open the item you want to substitute from (for example, your main product)
Go to Item and click Substitutes
Add the substitute item
Choose how they relate (for example, mark as interchangeable)
Interchangeable means either item can replace the other. That is useful when the customer likely does not care which brand it is, as long as it meets the same need.
Step 2: Use the substitution on a sales order
Now the real payoff: when a customer orders an item that is out of stock, Business Central can immediately surface approved alternatives.
On the sales line, you can:
See whether a substitute exists right away
Open the substitute list
Review availability based on the location tied to the order
No jumping between warehouses. No guessing. No extra clicks.
Once you and the customer agree on the alternative, a simple approval updates the order, so the sale keeps moving with no lost sales and no frustration.
Step 3: Communicate the alternative cleanly
In practice, the best sales motion looks like this:
“The requested item is out.”
“Here is a comparable alternative that is available.”
“If you are good with it, we will update the order.”
This keeps the conversation proactive instead of reactive. And it helps you keep momentum instead of waiting on inventory decisions.
For a step by step walk-through, check out this post from Yun Zhu.
Real-world example: when “zero availability” shows up
Imagine a store orders a specific product (for example, Sky Vodka), but availability is zero. That big “goose egg” moment can be brutal. But if substitutions are set up, the system does the heavy lifting.
When you open the substitute list, you will see candidates that are eligible and, importantly, you can see what is actually in stock for that order’s location.
That is where the “magic” feeling comes from. It is not just offering alternatives. It is offering alternatives that are usable right now.
Can you use substitutions on assembly and production orders?
Yes. Item substitutions can also be used beyond sales orders.
The key requirement is that substitutions are:
Correctly set up in the system, and
does not cause a material difference in the final product
So if your process allows it, you can apply the same idea to keep manufacturing and assembly orders from stalling when specific components are unavailable.
Quick checklist to get value fast
Pick your true equivalents and avoid “almost similar” substitutions that create downstream issues
Set up substitutions on the item cards using the right relationship type (like interchangeable)
Test on a sales order to confirm substitutes appear and availability reflects the correct location
Standardize customer communication so the alternative offer feels confident and professional
When substitutions are set up well, it stops being a fight with inventory and becomes a smooth process: keep shelves full, avoid missed sales, and give customers an answer that keeps the deal moving.
FAQ
What are item substitutions used for in D365 Business Central?
Item substitutions allow you to define approved alternative items and apply them to orders when the requested item is unavailable, helping prevent lost sales and improving customer experience.
How do I set up item substitutions?
Open the relevant Item card, go to Item then Substitutes, and add the substitute item(s). You can configure the relationship, such as marking items as interchangeable as well as adding conditions for when substitutions are acceptable.
Can sales orders show substitute availability by location?
Yes. When applying substitutions on the sales order, Business Central can display availability based on the location setup for that order, so you do not have to guess or check warehouses manually.
Will item substitutions update the order automatically after approval?
Once the customer approves the alternative, you can confirm and the sales order line updates to the substitute item, avoiding manually work, customer delays, and lost sales.
Are item substitutions limited to sales orders?
No. Item substitutions can also be used on assembly orders and production orders when setup is correct and the substitution does not cause a material difference in the final output.
Ready to optimize your Business Central environment with guidance from a BC expert?
Contact Ben Cole at Ben@BenColeBC.com or (214) 433-0923.
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Ben Cole is passionate about making Microsoft Dynamics 365 Business Central work smarter for real people—users and partners alike. With roots in public accounting, Ben’s seen firsthand how automation and clever solutions can transform the Business Central experience. He’s known for breaking down complex topics with a dash of wit and plenty of practical advice. If you want to get more out of Business Central (and maybe even enjoy the process), Ben’s your go-to guide.
(214) 433-0923
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