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Introduction to Inventory Management

A double-entry inventory has no stock input, output (disparition of products) or transformation. Instead, all operations are stock moves between locations (possibly virtual).

Bewerkingen

Stock moves represent the transit of goods and materials between locations.

Productieorder
Verbruik:
2 wielen: Stock → Productie
1 Fietsframe: Stock → Productie
Produceer:

1 fiets: productie → Stock

Configuratie:
Stock: the location the Manufacturing Order is initiated from
Production: on the product form, field "Production Location"
Drop-shipping

1 fiets: Leverancier → Klant

Configuratie:
Leverancier: op het product formulier
Klant: op de verkooporder zelf
Client Delivery
Verzamelen
1 Bicycle: Stock → Packing Zone
Verpakking
1 Bicycle: Packing Zone → Output
Verzending
1 Bicycle: Output → Customer
Configuratie:
on the pick+pack+ship route for the warehouse
Inter-Warehouse transfer
Overplaatsing:
1 Bicycle: Warehouse 1 → Transit
1 Bicycle: Transit → Warehouse 2
Configuratie:
Warehouse 2: the location the transfer is initiated from
Warehouse 1: on the transit route
Broken Product (scrapped)

1 Bicycle: Warehouse → Scrap

Configuratie:
Scrap: Scrap Location when creating the scrapping
Voorraad
Ontbrekende producten in voorraad
1 Bicycle: Warehouse → Inventory Loss
Extra producten in voorraad
1 Bicycle: Inventory Loss → Warehouse
Configuratie:
Inventory Loss: "Inventory Location" field on the product
Ontvangst
1 Bicycle: Supplier → Input
1 Bicycle: Input → Stock
Configuratie:
Supplier: purchase order supplier
Input: "destination" field on the purchase order

Analyse

Inventory analysis can use products count or products value (= number of products * product cost).

For each inventory location, multiple data points can be analysed:

  • inventory valuation
  • value creation (difference between the value of manufactured products and the cost of raw materials used during manufacturing) (negative)
  • value of lost/stolen products
  • value of scrapped products
  • value of products delivered to clients over a period
  • value of products received from suppliers over a period (negative)
  • value of products in transit between locations
Location Value
Physical Locations $1,000
 Warehouse 1 $600
 Warehouse 2 $400
Partner Locations - $1,500
 Customers $2,000
 Suppliers - $3,500
Virtual Locations $500
 Transit Location $600
 Initial Inventory $0
 Inventory Loss $350
 Scrapped $550
 Manufacturing - $1,000

Procurements & Procurement Rules

A procurement is a request for a specific quantity of products to a specific location. They can be created manually or automatically triggered by:

Nieuwe verkooporders
Effect
A procurement is created at the customer location for every product ordered by the customer (you have to deliver the customer)
Instelling
Procurement Location: on the customer, field "Customer Location" (property)
Minimale voorraadregels
Effect

Een inkoop is aangemaakt op de regel zijn locatie.

Instelling

Inkoop locatie: op de regel, veld "Locatie"

Inkoopregels
Effect
A new procurement is created on the rule's source location

Procurement rules describe how procurements on specific locations should be fulfilled e.g.:

  • waar het product vandaan moet komen (bronlocatie)

  • whether the procurement is MTO or MTS

Routes

Procurement rules are grouped in routes. Routes define paths the product must follow. Routes may be applicable or not, depending on the products, sales order lines, warehouse,...

To fulfill a procurement, the system will search for rules belonging to routes that are defined in (by order of priority):

Magazijnen

Warehouse Route Example: Pick → Pack → Ship

Verzamellijst:

Verzamelzone → Verpakkingszone

Verzamellijst:

Verpakkingszone → Poort A

Ontvangst order:

Poort A → Klant

Routes that describe how you organize your warehouse should be defined on the warehouse.

Een product

Product Route Example: Quality Control

Ontvangst:
Supplier → Input
Bevestiging:
Input → Quality Control
Opslag:
Quality Control → Stock
Productcategorie

Product Category Route Example: cross-dock

Ontvangst:
Supplier → Input
Cross-Docks:
Input → Output
Ontvangst:
Output → Customer
Verkooporderregel

Verkooporderlijn voorbeeld: dropshipping

Order:

Leverancier → Klant

Push regels

Push rules trigger when products enter a specific location. They automatically move the product to a new location. Whether a push rule can be used depends on applicable routes.

Kwaliteitscontrole
  • Product lands in Input
  • Push 1: Input → Quality Control
  • Push 2: Quality Control → Stock
Warehouse Transit
  • Product lands in Transit
  • Push: Transit → Warehouse 2

Procurement Groups

Routes and rules define inventory moves. For every rule, a document type is provided:

  • Verzamelen

  • Verpakking

  • Ontvangst order

  • Inkooporder

  • ...

Moves are grouped within the same document type if their procurement group and locations are the same.

A sale order creates a procurement group so that pickings and delivery orders of the same order are grouped. But you can define specific groups on reordering rules too. (e.g. to group purchases of specific products together)