Inventory Management

Last updated: november 21, 2019

Inventory Management

Inventory is the heart of the business; it is from here all other parts of the business get sufficient energy to live. If properly managed, the business remains healthy, otherwise always messy. Odoo inventory management is a resourceful module which can be utilized by any business organization irrespective of their size. It is designed in such a flexible manner. Odoo inventory is fully integrated with other applications, such as Purchase, Sales or Inventory. But is not limited to those processes, it is also fully integrated with our e-Commerce, Manufacturing and Repairs applications. To Access inventory and warehouse management module in your ERP, you have to install ‘Inventory Management’ app from Odoo.

Odoo inventory management makes a worthy product to use because of the following features.

Clean and Fast

Odoo Double entry inventory management, flexible design, modern user interface, mobile control and tracking mechanisms make Odoo a clean and fast performing ERP.

Basic operation support

Prepare delivery order in simple steps, control and manage incoming shipments, prepare inventory counts (cycle counts), multiple location management, barcode-based packing, efficient scrap management, stock transfer option etc. Odoo support all the basic and advanced operations taking place in a warehouse.

Advanced Routing

Odoo advanced routing support operations like:

Drop-shipping: Deliver to customers straight from your supplier based on products, orders or customers.

Cross-Docking: Unload incoming material and directly transfer to outbound gates with little to no storage in between.

Put away & Removal strategies

Define your own storage and removal strategies; FIFO, nearest available zone, LIFO, etc.

Pick - Pack - Ship

Design your own order process flow. Deliver to customers in one step (delivery order) or several steps: picking, packing, and shipping.

Push & Pull Routes

Design your own product routes to automate transfer orders between warehouses or locations.

Multi-Warehouses

Manage all your warehouses with the same system and define replenishment rules between warehouses.

Replenishments

To keep your inventory properly replenished, Odoo provides options like

Minimum Stock: Have proposition of purchase orders (or request for quotations) created by Odoo based on your future stock forecast.

Purchase Propositions

Get purchase order propositions based on supplier lead times, product demand and inventory forecasts.

Make-to-Order

Purchase raw materials or manufacture products to order. Define your own routes specific to warehouses, products, orders, etc.

Request for Quotations

Want to negotiate a price with suppliers every time you buy a specific product? Odoo can trigger request for quotations automatically based on future needs.

Traceability

Tracking your product inside and outside the inventory is a challenging task. But Odoo traceability features like ‘Lots Tracking’, ‘Activity Log’, ‘Serial Numbers’, ‘Perpetual valuation’ make it easier for you.

Product Types

Odoo supports several product types that have different behavior: physical products, consumables, services, digital products.

Kits

Odoo's kitting features allows your salesperson to sell a kit, but you will deliver a set of products.

Custom fields

Add as many custom fields as you want on products to handle your business needs.

Multi-Level Variants

Define multiple level variants in just a few clicks. Create matrix based on colors, sizes, attributes, etc.

Multiple unit of measures

Odoo supports multiple unit of measures and converts automatically for you: buy a pallet of beer, sell packs of beers.

Expiration Dates

Track expiration dates on products.

Multiple barcodes

Create custom barcodes with specific codes to implement desired behaviors, such as a specific promotion.

Business intelligence

The capability of Odoo BI and reporting tools are already explained in many modules. Odoo BI tools perform similar admirable jobs here in Manufacturing module by providing reports like inventory forecast, customer transaction drill down reports, perpetual inventory valuation reports etc.

If we compare Odoo Inventory with proprietary ERP Microsoft Dynamics, we can that find many features like Freight Carrier Integration, Consignee stock management, etc. are not available there. And if the comparison is between SAP and Odoo, Odoo has the advantage of features like multiple variant support, Up and Down traceability, more effective barcode support etc.

Before going to the detailed operations of Odoo inventory management, let’s first explore some of the terms used in the modules. It will give you a better understanding about working Odoo Inventory management system.

Warehouse: A warehouse in Odoo is a location where you store products. It is either a physical or a virtual warehouse. It could be a store or a repository.

Location: Locations are used to structure storage zones within a warehouse. In addition to internal locations (your warehouse), Odoo has locations for suppliers, customers, inventory loss counter-parts, etc.

Lots: Lots are a batch of products identified with a unique barcode or serial number. All items of a lot are from the same product. (E.g. a set of 24 bottle) Usually, lots come from manufacturing order batches or procurements.

Serial Number: A serial number is a unique identifier of a specific product. Technically, serial numbers are similar to having a lot of 1 unique item.

Unit of Measure: Define how the quantity of products is expressed. Meters, Pounds, Pack of 24, Kilograms etc. Unit of measure of the same category (ex: size) can be converted to each other’s (m, cm, mm) using a fixed ratio.

Consumable: A product for which you do not want to manage the inventory level (no quantity on hand or forecasted) but that you can receive and deliver. When this product is needed Odoo suppose that you always have enough stock.

Stockable: A product for which you want to manage the inventory level.

Package: A package contains several products (identified by their serial number/lots or not). Example: a box containing knives and forks.

Procurement: A procurement is a request for a specific quantity of products to a specific location. Procurement are automatically triggered by other documents: Sale orders, Minimum Stock Rules, and Procurement rules. You can trigger the procurement manually. When procurements are triggered automatically, you should always pay attention for the exceptions (e.g. a product should be purchased from a vendor, but no supplier is defined).

Routes: Routes define paths the product must follow. Routes may be applicable or not, depending on the products, sales order lines, warehouse, etc. To fulfill a procurement, the system will search for rules belonging to routes that are defined in the related product/sale order.

Push Rules: 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.

Procurement Rules or Pull Rules: Procurement rules describe how procurements on specific locations should be fulfilled e.g.: where the product should come from (source location), whether the procurement is MTO or MTS etc.

Procurement Group: Routes and rules define inventory moves. For every rule, a document type is provided: Picking, Packing, Delivery Order, Purchase Order etc. Moves are grouped within the same document type if their procurement group and locations are the same.

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

Quantity On Hand: The quantity of a specific product that is currently in a warehouse or location.

Forecasted Quantity: The quantity of products you can sell for a specific warehouse or location. It is defined as the Quantity on Hand - Future Delivery Orders + Future incoming shipments + Future manufactured units.

Reordering Rules: It defines the conditions for Odoo to automatically trigger a request for procurement (buying at a supplier or launching a manufacturing order). It is triggered when the forecasted quantity meets the minimum stock rule.

Cross-Dock: Cross-docking is a practice in the logistics of unloading materials from an incoming semi-trailer truck or railroad car and loading these materials directly into outbound trucks, trailers, or rail cars, with no storage in between. (Does not go to the stock, directly from incoming to packing zone)

Drop-Shipping: Move products from the vendor/manufacturer directly to the customer (could be retailer or consumer) without going through the usual distribution channels. Products are sent directly from the vendor to the customer, without passing through your own warehouse.

Removal Strategies: The strategy to use to select which product to pick for a specific operation. Example: FIFO, LIFO, FEFO.

Put away Strategies: the strategy to use to decide in which location a specific product should be set when arriving somewhere. (Example: cables goes in rack 3, storage A)

Scrap: A product that is broken or outdated. Scrapping a product removes it from the stock.

PRODUCT CONFIGURATION

CREATE NEW PRODUCT

For that go to Inventory > Master Data > Product > Create.

Odoo will enlists a set of products for you. But one can create a product depending on the business requirement and needs via clicking the button CREATE.

Via clickcing the CREATE button, you will be navigated to a new window like below:

The create form has the following fields:

  • Product name: It is the name which will be displayed on all other screens that refer to this specific product.
  • Can be Sold: To remove a product from showing up on ‘sales product’ list, uncheck the Can be Sold button. Generally, this is used while creating a raw material or a product for internal consumption.
  • Product Type: Product Type is the first option on the Information tab. There are three available product types:
  • Services: A service is a non-material product which you provide. This type of product will configure at the time when your company is providing any type of services to your customers. Therefore it does not appear in the various stock operations.
    In Odoo, the services are also considered as a product. But user can't keep the stock of a service.
  • Consumables: A product for which the user doesn't want to manage the inventory (no quantity on hand or forecasted) but that can be received from the supplier or delivered to the customer. Odoo assumes that the product always has enough stock.
  • Stockable: The product which is managed with Inventory.This product is used in stock management and its replenishment is more or less automated by the rules defined in the system. In Stockable product, you can easily maintain your minimum stock level by defining reordering rule for stock in your system, so that your stock will not reach to out of stock. If you do not set Reordering rule, Odoo ERP will show-up warning messages in quotation, if there isn’t enough balance in the stock. Odoo ERP will prevent processing delivery orders that don’t have balances in the stock and it can be processed only by force availability button in the delivery order.
  • Product Category: User can organize the products under a specific category.
  • Internal Reference: For the most part, Odoo utilizes the Product Name field and the description when displaying product information. It is very common that a company may have a coding system for its products. The Internal Reference field is useful to enter an alternative product code or number for the product in that case.
  • Barcode: Especially, when the number of products is more, the probability of human error also increases. Now smartly and effortlessly add/update product quantity by scanning product barcodes while receiving or delivering products in your Odoo.
  • Sales Price: The price at which the product is sold to the customer.
  • Consumer Tax: Default taxes used when selling the product. Odoo's tax engine is very flexible and support many different type of taxes: value added taxes (VAT), eco-taxes, federal taxes, retention, withholding taxes, etc. For most countries, the chart of account you setup is automatically pre-configured with the main taxes of the country.
Under Sales Tab of product;

You have the following;

  • Invoicing Policy:
    • Ordered Quantity: Invoice quantities used by the customer.
    • Delivered Quantity: Invoice quantities delivered to the customer.
  • Subscription Product: If set, confirming a sale order with this product will create a subscription.
  • Email Template: Send a product specific email once the invoice is validated.
  • Event Ticket: If checked this product automatically creates an event registration at the sales order confirmation.
  • Optional Products: Optional products are suggested whenever the customer hits the”Add to cart .”
  • Sales Description: A description of the product that you want to communicate to your customers. This description will be copied to every Sales Order, Delivery Order, and Customer Invoice/Credit Note.
  • Warning Message; Selecting the ‘Warning Option’ will notify the user with the message. Selecting “Blocking Message” will throw an exception with the message and block the flow. The message has to be written in the next filed.
Under E-commerce Tab of product,
  • Website: Option to restrict publishing to this website.
  • Categories: The product will be available in each mentioned e-commerce category. Go to shop>Customize and enable ‘E-commerce categories.
  • Alternate Product: Suggest Alternatives to your customer (upselling strategy). Those product show up on the product page.
  • Accessory Product: Accessories show up when the customer reviews the cart before payment.
  • Extra Product Media:
Under Point of Sale Tab of product
  • Available in POS: Check this if you want this product to appear in the POS.
Under Purchase Tab of product
  • Reordering:
    • Procurement:
      Create a draft purchase order- Based on your product configuration, the system will create a draft purchase order.
      Propose a call for tender-If the purchase requisition module is installed and this option is selected, the system will create a draft call for tender.
  • Vendor Bills: Vendor Taxes- Default taxes used when buying the product.
  • Control Policy:
    • On ordered Quantities-Control bills based on ordered quantities.
    • On received Quantities-Control bills based on received quantities.
  • Purchase Descriptions: This note is added to purchase orders.
Under Inventory Tab of Product
  • Route: Depending on the module installed, this will allow you to define the route of the product. whether it will be bought, manufactured, replenished on order etc.
  • Manufacturing Lead Time; Average lead time in days to manufacture this product.In the case of multi level BOM,the manufacturing lead times of the component will be added.
  • Customer Lead Time: Delivery lead time in days. It is the number of days,promised to the customer, between the confirmation of the sale order and the delivery.
  • Packages: Gives different ways to package the same product.
  • Tracking: Via enabling the option you ensure the traceability of a storable product in a warehouse.
  • Product Location: The stock location will be used instead of the default one, as the source location for stock moves generated by manufacturing orders.
  • Inventory Location: The stock location will be used instead of the default one, as the source location for stock moves generated when you do an inventory.
  • Logistics: Here, you can give away the Weight, Volume, HS Code: Standardized code for international shipping and goods declaration. At the moment only used for FedEx Shipping Provider. Also you can assign the Responsible: The user will be responsible of the next activities related to logistics operations for this product.
  • Description for Delivery Orders: This note is added to Delivery Orders.
  • Description for Receipts: This note is added to receipt orders.
  • Description for Internal Transfers: This note is added to internal transfer orders.
Under Accounts Tab of product
  • Income Account: Keep this field empty to use the default value from the product category.
  • Expense Account: Keep this field empty to use the default value from the product category. If anglo-saxon accounting with automated valuation method is configured, the expense account on the product category will be used.

PRODUCT VARIANTS

Configure your products with variations and select optional product items

Product Variants

Product variations are utilized to oversee items having diverse varieties, similar to measure, shading, and so forth. It permits dealing with the item at the layout level (for all varieties) and at the variation level (specific attributes).

For instance, an organization selling shirts may have the accompanying item:

B&C T-shirt

Sizes: S, M, L, XL, XXL

Hues: Blue, Red, White, Black

In this model, B&C T-Shirt is known as the item layout and B&C T-Shirt, S, Blue is a variation. Sizes and shading are properties or attributes.

To enable the choice, go to Inventory >Configuration> Settings and Activate Variants under Product.

Upon clicking the attributes button, a window just like below will appear.

One can create a new attribute in Odoo or import from the list.

Upon clicking the CREATE button, you will be navigated to a new window like below:

  • Attribute Name: Name of the product variant.
  • Category: Set a category to regroup similar attributes under the same section in the comparison page of eCommerce.
  • Display Type: The display type used in the product configurator.
  • Variants Creation Mode:
    • Instantly:All possible variants are created as soon as the attribute and its values are added to a product.
    • Dynamically:Each variant is created only when its corresponding attributes and values are added to a sales order.
    • Never:Variants are never created for the attribute.

Note: the variants creation mode cannot be changed once the attribute is used on at least one product.

PRODUCTS IN DIFFERENT UNITS OF MEASURE

Now and again, dealing with products in various unit of measures is vital. For instance, in the event that you purchase items in a nation where the metric measuring standard is of utilization and sell them in a nation where the imperial framework is utilized, you should change over the units.

Another scenario is buying products in bigger packs from your supplier and later selling them in units to your customers.

Odoo empowers to work with various units of measure for one item.

You can set up Odoo to work with different units of measure for one product. For that go to, Inventory >Configuration> Settings and activate Units of Measure under Product.

Upon clicking Units of Measure button, you will be navigated to new window like below:

Upon clicking CREATE button, you can create new Units of Measure for your products.

Here, you can name the unit of measure, define its category (conversion between two units of measure can happen only if they belong to same category. The Conversion will be made based on the ratios.)

While doing inter-unit exchanges, the rounding adjustments are automatically done by Odoo.

Setting up units on your products

In Inventory Control > Products, open the product which you might want to change the purchase/sale unit of measure, and click on Edit.

In the Unit of Measure area, select the unit in which the item will be sold and in which internal exchanges will be executed.

In the Purchase Unit of Measure area, select the unit in which you buy the item. When you're set, click on Save.

Upon clicking the edit button you are provisioned to create new unit of measures in Odoo.

Transfer from one unit to another

While doing inter- unit exchanges, the rounding adjustments are consequently done by Odoo.

The unit of measure can be changed all through the entire procedure. The only condition is that the unit of measure is a piece of a similar class.

Let us see how it works

Buy in the Purchase Unit of Measure

Under Odoo Purchase, Create a new RFQ adding product with the different Units of Measure.

Later confirm it.

Upon created RFQ, Odoo automatically create purchase order. Here, Purchase UoM is Box of 6. Upon entering receipt linked to purchase order, 10 boxes of 6 units gets converted to 60 units. You can see stock is managed in units.

Replenishment

Upon clicking the Replenish button, one can change the unit of measure.

Sell in bigger UoM

Choose the desired unit of measure on the sale order. Here it is dozen. When doing so, the price automatically gets computed from Units UoM to selected UoM.

In delivery order, the UoM in sale order is converted to the UoM used for stock management (here the units).

PRODUCT PACKAGING

The package is the physical container where you put one or a few items from a picking. For instance, when you deliver a product, you can simply separate the product quantity to two different packages/bundles. Odoo enables you to have a report with the amount of items for each bundle.

Configuration:

Go to Inventory>Configuration>Settings and activate Product Packages under the option Products.

Upon clicking product packages, you will be navigated to a new window like below.

Here, you can define the Packaging Type, the products, quantity, barcode used for packaging identification, company.

Destination package can be made applicable if the company is transferring some goods to a certain location or to the customer itself. If all the products or product packages of different customers need to be sent to a particular location, then all the items can be put into a single container for the easier transportation, then this container can be termed as a Destination package.

Packaging

The packaging is the physical container that protects your product. If you are selling computers, the packaging contains the computer with the notice and the power plug.

In Odoo, packagings are used for indicative purposes on sale orders. They can be specified on the product form, in the inventory tab.

PRODUCT TRACEABILITY

To activate the product traceability in the warehouse, go to

Inventory> Configuration> Settings> Traceability

Lot and Serial Number

Lots and serial numbers have commonality in their functional end, however behaves different in situation. Lots and Serial numbers are widely used in apps like inventory, sales and purchase for tracing products.

Where lot corresponds to certain number of products that you received, which is stored in one single pack, Serial number performs like an identification number offered to one product in particular. Be it lot or the serial number, it helps in tracing the product journey from reception to delivery and post sales.

Lots can be highly useful at those circumstances where you receive products in great quantity. Thus lots can be made use for reporting, quality control and so forth.

On the other hand, serial numbers can be beneficial for those products that requires after-sales service, for instance; electronic goods.

Managing Serial Numbers

The serial number tracking can be beneficial for tracing a product’s current location, also tracing their history when they are moved from one location to another.

To activate the feature, enable the option Lots & Serial Numbers under Accounting>Inventory>Settings> Traceability. Click SAVE button to mark the changes.

Creating Lot/Serial Numbers

To activate, Go to Inventory-> Master Data->Lots/Serial Numbers

Upon clicking the lot/serial number You will find the lists of products with lot/serial numbers. To add a new product with lot/serial number click the CREATE button.

A creation form like below will appear:

The fields includes Product Name, Quantity, Internal Reference, Dates including: Best Before Date, End of the Life Date, Removal Date and Alert Date. Dates can be great helpful in tracking the products.

Let’s see how it works.

Serial Numbers

Firstly, activate the tracking of lot numbers. For that go to Inventory > Configuration > Settings and enable Lots & Serial Numbers. Click SAVE to mark changes.

Product Configuration

Configure a product of your choice for which you want to track using serial numbers.

Go to Master Data > Products and open the product. Click EDIT button and make changes. Select Tracking by Unique Serial Number in the Inventory tab. Then, click on save.

Manage Serial Numbers

Receipts

To receive an item that is tracked by serial number, you need to determine its serial number first. You have different ways of doing it.

  • Manual assigning
  • Multi-assignation
  • Copy/pasting from an Excel file

No matter which way you select, firstly go to detailed operations of your picking.

To Manually assign different serial numbers, under detailed operations, click on Add a line. Under the field, you can fill in the serial number.

Once done, you can click again Add a line for registering new serial number.

Multi-assignation

Odoo automatically create necessary lines under multi-assignation. All you need to do is enter the serial number for the product, also the number of products you have to assign with serial number.

One the entries are marked, click Assign Serial Number. Odoo automatically does the work.

Copy/pasting from an Excel file

To utilize copy/paste, open the spreadsheet containing the serial numbers. Copy the list and past them in the Lot/Serial Number Name column. Odoo automatically creates new lines

Operation types

One can also manage serial numbers for each activity type. To characterize it, go to Configuration > Operation Types in the Inventory application.

For each type, you can choose whether to go for new serial number or utilize existing ones. However, by default, the new serial number /lot is only allowed at product reception.

Serial Number traceability

Serial numbers help you to monitor where the items are received, placed in stock, to whom they were sold, and where they were dispatched to.

Open the Inventory application, and go to Master Data > Lots/Serial Numbers and click on the serial number you are hunting. Click on the TRACEABILITY button and you find in which documents the serial number has been utilized.

In case you need to locate a serial number, click the LOCATION button available on the serial number form.

Managing Lots

Firstly, activate the tracking of lot numbers. For that go to Inventory > Configuration > Settings and enable Lots & Serial Numbers. Click SAVE to mark changes.

Product Configuration

Now configure a product that you want to track by lot numbers.

Go to Master Data > Products and open the product of your choice. There, click on Edit and select Tracking by Lots in the inventory tab.

Manage Lots

Receipts

To receive a product tracked by lots, firstly specify the lot numbers. Like serial numbers, you have varied ways of managing lots:

  • Manually assign the different lot numbers
  • Copy/paste lot numbers from an Excel file
Manually assign the different lot numbers

Go to detailed operations, click on Add a line. There you can fill in the lot number. Once done, you can click on Add a line again to register a new lot number.

Copy/paste lot number from an Excel file

Open the spreadsheet containing lot numbers. Copy the list and past them in the Lot/Serial Number Name column for Odoo to automatically create necessary lines. Enter the number of products contained in each lot.

Operation Types

One can define lots for each operation type. For that go to Inventory app and go to Configuration > Operation Types.

For each type (receipts, internal transfers, deliveries, …), you can decide whether to go for new lot numbers or use the existing ones. By default, the creation of new lots is only allowed at product reception

Lots traceability

To track an item, open the Inventory module and, in Master Data > Lots/Serial Numbers, click on the lot number.

Via clicking Traceability button, you see documents where lot number is used.

To locate the lot number, click on the on Location start button.

PRODUCT EXPIRY

Especially in food and pharmaceutical industries, tracing stocks dependent on expiry dates is required to abstain from offering expired products to clients. With Odoo, you can trace your items dependent on their expiration dates, regardless of whether they are tracked by serial number or lot number.

To activate the feature, go to Inventory>Configuration > Settings> Traceability

Activate Lots & Serial Numbers and Expiration Dates features.

Click Expiration Dates to set the expiration dates on lots and serial numbers. Click Save to make the changes.

After applying this change, you have now a new option in the product form.

To set the product expiry, you can give the following attributes-

Product Life Time: When a new a Serial Number is issued, this is the number of days before the goods may become dangerous and must not be consumed.

Product Use Time: When a new a Serial Number is issued, this is the number of days before the goods start deteriorating, without being dangerous yet

Product Removal Time: When a new a Serial Number is issued, this is the number of days before the goods should be removed from the stock.

Product Alert Time: When a new a Serial Number is issued, this is the number of days before an alert should be notified.

If you are not giving these days in the product form, you can give the dates after the creation of the lot/serial number also. When a new serial number is assigned to this product. These dates are automatically calculated and stored in the Lot/serial number.

Expiration Alerts

To get access to expiration alerts, go to Master Data > Lots/Serial Numbers. Make use of the filter for knowing which all lots/serial numbers exceeded their alert date.

CONSIGNMENT

Configuration

Go to Inventory> Configuration> Settings> Traceability

Click on Consignment and Save to set owner on stored product.

INVENTORY OPERATIONS

TRANSFER

The Dashboard gives you a glimpse to all the operations in your Warehouses.

To view all the operations specifically in the warehouse, Got to

Inventory -> Operations->Transfers

Transfers include the receipts, delivery orders and internal transfers. You can see all listed here.

You can click and view the status of each one.

BATCH TRANSFER

Batch Transfer is defined as a group of transfers, picked together to make a batch. Here, transfers include the receipts, delivery orders and internal transfers.

In the usual scenario, the individual manages their every transfer separately. This is quite strenuous and challenging. However, under batch transfer, one can pick together several transfers and bring them under a single batch This significantly reduces the transport time and allows the business to fulfill large batches of items in a single move.

To initiate Batch Transfer, go to Inventory>Operations>Batch Transfer

Create Batch Transfer

After enabling the settings, one can create batch transfer.

Click CREATE button.

A creation form will appear like below:

Responsible: Person Responsible for this Batch Transfer

Add a line: Here, one can add transfers for this batch.

Via clicking CONFIRM button, you can make the Batch Picking.

INCOMING TRANSFER

Receive products in stock

Firstly, create products under Master Data > Products.

If you set your product type as Storable, you can track its stock, say how many units are available and what is the forecasted number of units. However, in case, if you do not want to track the stock, just add them in your receipts/delivery, you can set it as consumable.

Receive Products in Stock

Now create a receipt to enter products from your supplier in stock.

On the receipt document, you can specify the supplier (receive from), quantity of different products. Once everything is added, click on VALIDATE button. You products will enter the stock.

In case you have a planned transfer, you can create a planned receipt with a scheduled date.

Insert here the initial demand for each product, corresponding to what supplier ordered.

After entering click MARK AS DO for considering it in your forecast.

Receive Products in Stock from Purchase Orders

Validate the RFQ and create a receipt under purchase app. The corresponding receipt will be visible on the purchase order.

OUTGOING TRANSFER

Deliver products from stock

Firstly, create products under Master Data > Products.

If you set your product type as Storable, you can track its stock, say how many units are available and what is the forecasted number of units. However, in case, if you do not want to track the stock, just add them in your receipts/delivery, you can set it as consumable.

Deliver Products from Stock

As the products gets ready, you can proceed with delivering products to customers. The step is as follows:

In case of immediate transfer, click the option and specify the partner (to whom products will have delivered), products and their quantities. After delivery, click VALIDATE button. The products will be deleted from your stock.

In case you have a planned delivery, you can create a planned delivery with a scheduled date. Also add initial demand for each product, corresponding customer order. After entering click MARK AS DO for considering it in your forecast.

Deliver Products from Stock from a Sale Order

Product delivery can be initiated after validating a quotation. The corresponding delivery will be visible on the sale order.

INVENTORY ADJUSTMENTS

Inventory Adjustments acts as a pivotal feature in a warehouse management software to keep the inventory right. Once your products have been defined, it is time to make your initial inventory. You will reflect reality by inventorying the right quantities in the right locations.

So firstly configure your product via going to Inventory>Master Data> Products.

Set the product type as Storable for tracking its stock and making inventory adjustments

Inventory Adjustment for one Product

As soon as you open your product form you get access to the UPDATE QUANTITY button. You can see here, 0 product On Hand.

Click on the Update QTY on Hand button.

Upon clicking, you can see the current stock for this product. You can make edits such as locations, packages, or add new serial/lot numbers.

Once you come back to your product, you see that the quantity on hand updated.

Inventory Adjustment for Multiple Products

Operations > Inventory Adjustments and create a new one.

Here, you can define an inventory reference, a title for your inventory adjustment. Also you can decide whether to proceed with the inventory adjustment for all products or for some.

Then click START INVENTORY.

If there exists certain products in stock, Odoo will add the lines corresponding to theoretical quantity in stock. You can also add new lines with your other products.

Odoo will highlight in red if there comes a difference between the theoretical quantity on hand and quantity that is manually entered. After entering every product, click VALIDATE INVENTORY. Eventually, Quantities on hand of different products will be updated.

SCRAP MANAGEMENT

It is quite obvious to find scrap in your warehouse. Be it in the form of damaged, expired or any other. Scrap is often noticed while picking a product. Odoo helps you to managed scraps via moving these damaged goods to the scrap area.

Configuration

Odoo automatically creates a scrap location under the name virtual location or scrap. However, one can create a new scrap location via going to

Inventory > Configuration > Settings and activating Storage Locations.

Now, go to Configuration > Locations and create your scrap location.

If you tick the option, Is a scrap location, to allow using this location to put scrapped/damaged goods.

Ways to scrap products

One can scrap products from receipts, delivery order, and from internal transfer.

Scrap from receipt

Go to Inventory > Dashboard > Receipts

click on 1 TO PROCESS button.

Open the receipt and validate the picking. As the products enter the stock, SCRAP button appears on receipt screen.

Click SCRAP to remove the damaged goods from receipt.

Soon the products will be moved from stock to scrap location.

Scrap from delivery order

Go to Inventory > Dashboard > Delivery orders. Click 1 TO PROCESS button.

Once done, open the delivery order.

Click the SCRAP button on top.

Soon products shall be moved from available stock to virtual scrap location.

To view scrap orders,

Scrap from an internal transfer

Go to Inventory > Dashboard > Internal Transfers.

Open internal transfers and click on scrap button.

LANDED COST

Landed cost is the total price of a product once it has arrived at buyers’ hand. The total cost of a landed shipment including purchase price, freight, insurance, and other costs up to the port of destination. This includes the transportation fee, duty, handling fees, taxes, insurance, currency conversion, crating, handling and payment fees, etc. These prices are added and divided to get the actual selling price of the product.

Landed Costs = The purchase price of the product + Any additional charges to get the product to the buyer’s hands.

The way of calculating landed cost will vary according to the company and products which they are handling, etc. In some instances, it may also include the customs duties and other taxes levied on the shipment.

Configuration

Inventory->Configuration-> Settings->Valuation->Landed Costs

Now if you go to Inventory>Operations>Landed costs and click create button, you will be navigated to a new creation form like below:

Click Add a line to define a product for which the landed cost type is created.

Split Method: The field defines the method of splitting the landed cost type.

Odoo provides five split method options:

  • Equal: Selecting the option enables to equally divide the costs.
  • By Quantity: Enabling the option, costs will be divided according to products quantity.
  • By Current Cost: Enabling the option, costs will be divided according to product’s current cost.
  • By Weight: Enabling the option, costs will be divided depending on the product’s weight.
  • By Weight: Enabling the option, costs will be divided depending on the product’s weight.
  • By Volume: Enabling the option, costs will be divided depending on the product’s volume.

Cost: The field defines the cost used for stock valuation in Standard price and as a first price to set in average/FIFO. Also used as a base price for pricelists. Expressed in the default units of measure of the product.

RUN SCHEDULER

The scheduler is the calculation engine which plans and prioritizes production and purchasing automatically according to the rules defined on products. By default, the scheduler is set to run once a day (Odoo automatically creates a Scheduled Action for this).

Calculating Requirements / Scheduling

Scheduling only validates procurements that are confirmed but not yet started. These procurement reservations will themselves start production, tasks or purchases depending on the configuration of the requested product.

You take into account the priority of operations when starting reservations and procurements. Urgent requests, those with a date in the past, or requests with a date earlier than the others will be started first. In case there are no enough products in stock to satisfy all the requests, you can be sure that the most urgent requests will be produced first.

Configure and run the scheduler

Run the scheduler manually

This feature is not visible by default. You have to enable debug mode to see this. To enable debug mode, go to Help ‣ About and click on Activate the developer mode.

You can also start the scheduler manually from the menu Inventory> Operations> Run Schedulers. The scheduler uses all the relevant parameters defined for products, suppliers and the company to determine the priorities between the different production orders, deliveries and supplier purchases.

Configure and run the scheduler (only for advanced users)

This feature is not visible by default. You have to enable debug mode to see this. To enable debug mode, go to Help -> About and click on Activate the developer mode.

You can set the starting time of the scheduler by modifying the corresponding action in the menu Settings ‣ Technical ‣ Automation ‣ Scheduled Actions. Modify the Run mrp Scheduler configuration.

WAREHOUSE MANAGEMENT

WAREHOUSE

In Odoo, a Warehouse is a place where you stock your products. One can setup multiple warehouses, alongside create transfers between warehouses.

To create a new warehouse, go to Inventory>Configuration> Settings > Warehouse and activate manage several warehouses option.

Next go to Inventory > Configuration > Warehouses.

Click CREATE button to add new warehouse

Warehouse: In the field, insert the full name of the warehouse.

Short Name field: insert a 5-characters code for your warehouse. Keep in mind that this code is the one that will appear in the lists, so make sure you choose a name that is easy to understand and easy to enter.

Address field: You can select an existing company or create one on-the-go. Therefore, the address of your warehouse will be the same as the one of the company you selected. You can also leave this field empty and edit it afterwards.

Save all the changes to create a new warehouse. Now in the Dashboard you can see new operation types automatically created by Odoo on account of creation of a new warehouse.

LOCATIONS

A location is nothing but a particular space within warehouse say a shelf or floor. It can be called as a sub location of your warehouse. For this reason, one cannot link a location to multiple warehouses.

In odoo, one can configure multiple locations under a single warehouse. Mainly the location comes in 3 models.

  • Physical Locations: An internal location within a warehouses for which you are the owner.
  • Partner Locations: Spaces within a customer or vendor's warehouse for which you aren’t the owner.
  • Virtual Locations: Space that do not exist in real, but in which products can be placed when they are not physically in an inventory say when products that are on their way to the warehouse (Procurements).

In Odoo, locations are structured like a tree, dependent on a parent-child relationship.

Configuration

Go to Inventory application > Configuration > Settings> Warehouse and activate Storage Locations.

Next, go to Inventory application> Configuration > Locations to create new location

Upon clicking create button, you will be navigated to new window like below:

Here, you can define Location Name, select the Parent Location from the list. Parent location can be a physical, partner or virtual location. Alongside, one can also add multiple sub-locations to a location.

In case you want to allow this location to keep the scrapped/damaged products, you can tick the Is a scrap location? Menu. and Is a Return Location? to allow using this location as a return location.

In case Barcode application is installed, you can specify the barcode that corresponds to this particular location.

RULES & ROUTES

Procurement is the action of obtaining the desired or required amount of product rather than going for bulk, and the procurement inventory control system begins with a customer order. One of the prime advantages the end user can acquire from the procurement rule is that he can evade the possibility of excess inventory. Here, the end user is freed from the management or storing of excess stock. The procurement rule reduces the inventory levels and thereby the cost of storing the goods in the inventory.

Push Rule however involves forecasting inventory needs to meet customer demand. Disadvantage of the push inventory control system is -too much product is left in inventory as the sales are unpredictable. This eventually rise the cost of company to store these goods. However, the advantage is company will be always self-sufficient to meet customer orders

To satisfy a procurement, the system will scan for rules belonging to routes characterized in particular sale order.

Configuration

Go to the Inventory >Configuration>Settings> Warehouse->Multi-step Routes.

In order to create new rules or view the existing rules go to Inventory >Configuration >Rules.

One can see the different actions set under the menu. To create a new rule, click CREATE button.

You will be navigated to a creation form like below:

Here you can define:

  • Action
  • Operation Type:
  • Source Location
  • Destination Location
  • Routes for the product:

The default routes in Odoo ERP includes: Drop Shipping, Re supply subcontractor on order, Manufacture, Buy and Make To Order.

  • Drop Shipping: Under the Drop Shipping function, the vendor does not keep the products in stock, rather process the delivering of goods directly from the vendor to the customer. There will not be any stock housing during the transit.
  • Buy: Buy proposes a purchase or manufacturing the product.
  • Re-supply Subcontractor on Order: Using this route, one can subcontract the production of some finished products through subcontractors.
  • Manufacture: Under this route, one can set up production plans and workflows for your customizable products.
  • Replenish on Order/ Make To Order: The Make to Order function trigger a purchase order as soon as a sales order related to the product is generated. Here, the function doesn’t evaluate the current stock and draft a purchase order even if the product quantity is inadequate. i.e. it triggers the purchase order regardless of the product quantity in hand.

One can see the routes for each product under the inventory tab of the product.

ROUTES

Routes are the different ways by which the particular products are obtained or sold from the warehouse. Routes might be relevant or not appropriate relying upon the products, the sales order lines, the stockroom, and so on. Odoo can manage advanced push/pull routes configuration for instance creating a route for managing the products manufacturing chain or say manage default locations per product.

Drop-shipping

Deliver to customers straight from your supplier based on products, orders or customers.

Cross-Docking

Unload incoming material and directly transfer to outbound gates with little to no storage in between.

Put away & Removal strategies

Define your own storage and removal strategies; FIFO, nearest available zone, LIFO, etc.

Pick - Pack - Ship

Design your own order process flow. Deliver to customers in one step (delivery order) or several steps: picking, packing, shipping.

Push & Pull Routes

Design your own product routes to automate transfer orders between warehouses or locations.

Multi-Warehouses

Manage all your warehouses with the same system and define replenishment rules between warehouses.

Inventory->Configuration->Settings->Warehouse

Odoo embeds some pre-configured routes for your warehouses. To see them,

In the Inventory application, go to Configuration > Warehouses.

In the Warehouse Configuration tab, Set Warehouse routes options set some routes according to your choices.

Under the form you will find the fields such as:

Short Name: Short name to identify your warehouse.

Company: The Company is automatically set from your user preference.

Under Warehouse configuration

Incoming shipments: Default incoming routes to follow:

  • Receive goods directly (1 STEP).
  • Receive goods in input and then stock (2 STEPS).
  • Receive goods in input, then quantity and then stock (3 STEPS).

Outgoing Shipments: Default outgoing routes to follow:

  • Deliver goods directly (1 STEP)
  • Send goods in output and then deliver (2 STEPS)
  • Pack goods, send goods in output and then deliver( 3 STEPS)

Under Resupply

Resupply Subcontractors: Resupply contractors with components.

Manufacture to Resupply: When products are manufactured, they can be manufactured in this warehouse.

Manufacture: Produce: Move the raw materials to the production location directly and start the manufacturing process. Pick/Produce: Upload the raw materials from the Stock to Input Location first, and then transfer it to the production location.

Buy to Re-supply: When products are brought, they can be delivered to this warehouse.

Custom Routes

Configuration

Go to Inventory> Configuration>Routes

Upon clicking routes, you will be navigated to a new window like below. You can see the existing list of routes, however can create new routes via clicking the CREATE button.

Upon clicking the CREATE button, you get navigated to a new window like below to create your custom route.

Here you can define the route name, sequence, company (leave this field empty if the route is shared between all countries), Option to select the place where this route can be selected- Product Categories, Products, Warehouses, Sales Order Lines) and Rules.

Routes applied on warehouses

If you tick Warehouses, you have to choose on which warehouse it will be applied. The route will be set for all transfer in that warehouse that would meet the conditions of the procurement and push rules.

You can see the rules defined here

Routes applied on products

If you tick Products, you have to manually set on which product it will be applied.

Open the product on which you want to apply the routes (Inventory ‣ Master data ‣ Products). In the Inventory Tab, select the route(s):

Routes applied on Product Category

If you tick Product Categories, you have to manually set on which categories it will be applied.

Open the product on which you want to apply the routes (Configuration ‣ Product Categories). Select the route(s) under the Logistics section:

Routes applied on Sales Order lines

If you tick Sales order lines, you have to manually set the route every time you make a sale order.

In order to make it work, you also have to activate the use of the routes on the sales order.

In the Sales application, go to Configuration ‣ Settings and tick Choose specific routes on sales order lines (advanced).

You can now choose the routes for each lines of your sales orders:

Make-to-Order Route

If you work with no stock, or with minimum stock rules, it is better to use the Make To Order route. Combine it with the route Buy or Manufacture and it will trigger automatically the purchase order or the Manufacturing Order when your products are out-of-stock.

PUTAWAY RULES

Put away is the way toward taking items off the receiving shipment and placing them in a safe area. For instance, your warehouse will have volatile substances, in that case placing every product together can cause some kind of chemical reaction.

Configuration

Go to Inventory>Configurations>Settings> Warehouse and Activate setting Storage Locations.

Put away strategies are defined at location level.

If you go to Inventory> Configuration> Locations

You can see the putaway rules on the top of the location screen.

Via clicking the Put away rules, you will be navigated to a new window like below:

Here you can enter the Product name, Category of the product, Location to which that product arrives in and also to which location the product should be stored to. Defining these, the put away rule will trigger the move of goods/items correspondingly.

REMOVAL STRATEGIES

Removal strategies are usually in picking operations to select the best products in order to optimize the distance for the worker, for quality control purpose or due to reason of product expiration.

When a product movement needs to be done, Odoo will find available products that can be assigned to shipping. The way Odoo assign these products depend on the removal strategy that is defined on the product category or on the location.

Configuration

Go to Inventory> Configuration> Settings and enable option Set Put away Rules on Location, then click on Save.

Then, open Inventory> Configuration > Locations and open the location on which you want to apply a removal strategy.

Odoo enables with 3 types of Removal Strategies:

  • First In First Out (FIFO)
  • Last in First Out (LIFO)
  • First Expiry First Out (FEFO)
FIFO ( First In First Out )

A First In First Out strategy implies that the products that were stocked first will move out first. Companies should use FIFO method if they are selling perishable goods. Companies selling products with relatively short demand cycles, such as clothes, also may have to pick FIFO to ensure they are not stuck with outdated styles in inventory.

Configuration

Go to Inventory ‣ Configuration ‣ Locations, open the stock location and set FIFO removal strategy.

LIFO (Last In First Out)

In this warehouse management, the products which are brought in the last, moves out the first. LIFO is used in case of products which do not have a shelf life.

Configuration

Go to Inventory ‣ Configuration ‣ Locations, open the stock location and set LIFO removal strategy.

FEFO (First Expiry First Out )

In FEFO warehouse management, the products are dispatched from the warehouse according to their expiration date.

Go to Inventory ‣ Configuration ‣ Setting. Check the option Expiration date Then click on save changes.

This will allow you to set four expiration fields for each lot or serial number: best before date, end of life date, alert date and removal date. These dates can be set from Inventory Control ‣ Serial Numbers/Lots.

Product Life Time: When a new a Serial Number is issued, this is the number of days before the goods may become dangerous and must not be consumed.

Product Use Time: When a new a Serial Number is issued, this is the number of days before the goods start deteriorating, without being dangerous yet

Product Removal Time: When a new a Serial Number is issued, this is the number of days before the goods should be removed from the stock.

Product Alert Time: When a new a Serial Number is issued, this is the number of days before an alert should be notified.

When a new serial number is assigned to this product. These dates are automatically calculated and stored in the Lot/serial number.

If you are not giving these days in the product form, you can give the dates after the creation of the lot/serial number also.

PRODUCT CATEGORIZATION AND INVENTORY VALUATION

Having a precise inventory valuation is critical on the grounds that, it is the reported measure of the stock or the inventory that influences the expense of goods sold, the net profit, and the overall gain on the income statement. Also, the accurate inventory valuation measures the current resources, working capital, investors' or proprietor's equity reported on the balance sheet.

Product Categorization

Configuration

Go to Inventory->Configuration->Product Categorization

You can see a list of product categories in Odoo.

To create a new product category, click the button CREATE.

A creation form will appear like below:

The field includes:

  • Category Name: One can provide the new category name in the corresponding field
  • Parent category: One can create the hierarchy of the product category by choosing the parent category.
  • Tax Cloud Category: This refers to Taxability Information Codes that are used by Tax Cloud to compute specific tax rates for each product type. This value is used when no TIC is set on the product. If no value is set here, default value set in invoicing will be used.
  • Inventory Valuation:

Odoo offers two inventory valuation methods: Manual and Automated

  • Manual: The accounting entries to value the inventory are not posted automatically when a product enters or leaves the company.
  • Automated: An accounting entry is automatically created to value the inventory when a product enters or leaves the company.

Costing Method:

Odoo provides with 3 Costing Methods:

  • Standard Price: The products are valued at their standard cost defined on the product. Value = Total quantity*Standard Price. For example, product quantity is 15 and standard price of the product is Rs 80, then value= 15 * 80 = Rs 1200
  • First In First Out (FIFO): The products are valued supposing those that enter the company first and will also leave first. First I have purchased 10 products at Rs 80 , then 15 product at Rs 90 ,and sold 5 products Then, Value = 5 * 80 + 15 * 90 = Rs 1750
  • Average Cost (AVCO): The products are valued at weighted average cost. Value = Quantity * cost of the product. For example, if I have purchased 10 products at Rs 80 and 15 product at Rs 90 , and sold total 10 products. In this case, the cost of the product equals 86 and Quantity 15. The Value equals 15 * 86 = Rs 1290
    • Force removal strategy: Select a specific removal strategy that will be used regardless of the source location for the product category. There are 3 types of force removal strategy available in odoo,
      • First In First Out (FIFO): The product which has arrived first will get removed first from the stock.
      • Last In First Out (LIFO): The product which has arrived last will get removed first from the stock.
      • First Expiry First Out (FEFO): The product which gets firstly expired will be removed first from the stock.

DELIVERY

SHIPPING METHODS

Odoo can handle various shipping methods, but it is not activated by default. Shipping methods can be used for your sale orders, your deliveries but also on your e-commerce. Shipping methods allow you to manage the transport company, the price and the destination. You can even integrate Odoo with external shippers to compute the real price and the packagings.

Configuration

To configure your shipping methods, Inventory > Configuration>Delivery > Shipping Methods.

Upon clicking the CREATE button, you will be navigated to a new window with a creation form like below:

Here you can define the name for your shipping method, Select the provider, Margin on Rate ( This percentage will be added to the shipping price) , Selecting the option of Free Shipping, if the order amount is above, Delivery product, Company, Website etc.

Then you'll have to set the pricing. It can be fixed or based on rules.

If the price varies according to rules, tick Based on Rules. Click on add an item to a pricing rule. Choose a condition based on either the weight, the volume, the price or the quantity.

Finally, you can limit the shipping method to a few destinations. The limit can be applied to some countries, states or even zip codes. This feature limits the list of countries on your e-commerce.

Note :You can integrate Odoo with external shippers in order to compute the real price and packagings, and handle the printing the shipping labels.

Integrating a third party shipper

Odoo can handle various shipping methods, including third party shippers. Odoo can be linked with the transportation company tracking system. It will allow you to manage the transport company, the real prices and the destination.

Configuration

Inventory>Configuration> Settings> Shipping

DELIVERY PACKAGES

Using Odoo, one can deliver products under different packages based on its volume or weight.

Configuration

Go to Inventory> Configurations>Settings and activate Delivery Packages under Operations.

Proceed to a Delivery

Create a planned delivery with certain products inside. There you can create the new packages and assign them to the stock move lines.

Define the package type. After validating the delivery order, you can retrieve which products are included in the package.

Put in Pack

Put in Pack button is yet another mode to put products in a pack. Via clicking the Put in Pack button, Odoo automatically assign a pack to the number of products which is set as Done. Also duplicate the stock move line if necessary.

One can update the different packages created via tapping the PACKAGES button.

SEND AUTOMATED EMAILS AT DELIVERY

Configuration

Inventory>Configuration>Settings and activate the Email Confirmation feature.

Activating the feature, Odoo automatically creates an email template.

Send email at delivery validation

After validating the product and delivery, an automated email is sent. The information appears in chatter.

If you work with a shipping method, and then have a tracking link, it will be included in the standard email template.

SEND AUTOMATED SMS AT DELIVERY

Configuration

Go to Inventory> Configuration> Settings and activate SMS Confirmation under Shipping.

By default, there exists a SMS template. However, one can create a new template via clicking the arrow button.

Send SMS at delivery validation

Create a delivery order for a specific partner and Validate the delivery.

Now, the automated SMS appears in the chatter.

REPORTING

Warehouse Analysis
Inventory Report
Forecasted Inventory
Inventory Evaluation
Stock Moves
Product Moves
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