Summary:

A custom entity may be created in Sage CRM using the advanced customisation wizard without selecting the options "Has library or has communications". Can the mail merge feature be added to this entity at a later date without recreating the custom entity?

Workaround:

Yes, this is possible. Instructions are available on the Sage CRM Community, in a blog post entitled "Adding Document Filing and Mail Merge functionality to your existing Custom Entities".

 External link: Community.