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.


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


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.


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.


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.


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.



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