Inventory management
Inventory management brings quantities, locations and states together. Physically present goods are not automatically available for further sales.
What is inventory management?
Inventory management records and controls item quantities and states at storage locations. Sales decisions need to distinguish physically present quantities, quantities already committed and quantities blocked for other reasons. Expected deliveries are tracked separately. The system used defines the state names and the events that change them.
A fictional stationery retailer considers one ring binder variant at one location: 28 units are physically present, including 7 committed to orders and 2 blocked for a quality check. In this example, 28 - 7 - 2 = 19 units are available for further sales. Another 12 units are expected but have not arrived; they do not yet increase stock on hand. The planned inventory view should show these quantities separately. On receipt, the actual quantity and condition are checked before the new goods are released under the defined rules.
Sources
Related terms
- Inventory reservationAn inventory reservation assigns a quantity to an order or purpose. It becomes unavailable for other operations even though it has not been shipped.
- Product bundleA product bundle offers several products together. Its contents, price and available components must match the quantity sold.
- DropshippingWith dropshipping, a supplier sends the sold item directly to the customer. Shop orders, supplier orders and updates need to match.
- FulfilmentFulfilment covers the operational preparation and shipping of ordered goods. Picking, packing, handover and delivery need traceable events.
- Order management systemAn order management system links information and processing steps for an order. Individual lines can remain in different states.
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