Retail

Why is Inventory Status such an important concept?

As part of the Advanced Warehouse Operations (AWO), which on its turn is at the center of the new Openbravo Supply Chain Suite, the Inventory Status (IS) allows organizations to distinguish between good and bad stock, stock that is avaiable or not avaialabe,  and stock that should be  taken into account for planning, or not.

Regardless of whether your inventory is in sellable condition or not, it still has an accounting value and can’t just be thrown away. Likewise, stock that is not actually available, might very well be ‘available’ from a planning perspective. And another typical use of inventory status is to allow stock to go negative — see below for more on this specific example.

In the introduction I’ve quickly touched upon the three characteristics or flags in the Openbravo Inventory Status functionality:

  1. Is this stock Available? This flag interferes in the activity of reservations, picking and issuing. Any stock that is not available will be ignored by these process flows.
  2. Is this stock Nettable? This flag interferes in the planning activity. Stock that is not nettable is ignored in the calculation of the planning.
  3. Can this stock be Over-Issue? This flag interferes when goods are issued, either for work orders, sales orders or distribution orders. If Over-Issue is allowed, the system will not limit the quantity to issue to the on-hand quantity (the actual  quantity physically held in the warehouse). This can result in a (temporary) negative stock and is expected to be resolved in the near future with a goods receipt.

The IS can be freely configured, although with Openbravo (as from 17Q3) comes a set of eight typical and preconfigured inventory status values.

In order to get an agile process, inventory adopts the IS of the bin that it is stored or received in. This allows you to configure your warehouse with areas for receipts, for returns, for inspection or for plain storage. Goods that are moved to any of these locations/bins automatically will reflect the IS of the bin and subsequently be available -or not, nettable -or not- and allow for over-issue -or not.

 

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