Odoo 18 Enterprise Book: Inventory

3. Configuration

Warehouse Management

Warehouse management is one of the unbiased activities of the inventory operations of a firm. For proper running of the stock operations and transfers, the warehouses of a firm must be properly managed and supervised. Odoo, as a great inventory management helper can provide you with dedicated platforms for proper management of the company's warehouses. The Odoo tools can assist you in handling multiple warehouses at a time. The number of warehouses a company possesses will vary depending on the business they conduct. Regardless of the size and number of warehouses a company has, Odoo will always ensure to simplify the workflow.

Advanced features like Warehouse, Locations, Routes, Rules, Operation Types, Storage Categories and Putaway Rules on the Warehouse Management tab are available in the Configuration menu of the Odoo Inventory module.

4.1 Warehouse

These are the options that will help you execute various warehouse operations. First, we need to discuss how to configure warehouses in the Odoo 18 Inventory module. To do this, you can choose the Warehouses option under the Configuration menu.

The above illustrated screenshot is the list view of warehouse platform. You will receive the Warehouse, Address, and Company information from this view. Utilizing the New button let's set the details of a new warehouse to the Odoo Inventory module.

Here, you can enter the Warehouse, Short Name of the warehouse, Company, Address, opening hours, and Intrastat Region that the warehouse is part of in the respective fields. Under the Warehouse Configuration section, you are asked to specify the Shipments and Resupply information.

In the Incoming Shipment, you have the option of how to handle the incoming shipment of the products. If you choose the Receive goods directly option, you can receive products directly into the warehouse. In the Receive goods in input and then stock method, the incoming shipment has two-step. In this two-step method, the products will be received first and then transferred to the stock. Once you have taken delivery of the goods, you can conduct quality checks on the same before you stock them via the Receive goods in input, then quality, and then stock method of the incoming shipment. The same kinds of options shall be there for the Outgoing Shipment too and you shall be able to choose the appropriate one for this warehouse's shipment operations.

With the Resupply tab, you shall have upgraded features to switch on.

Enabling the Dropship Subcontractors feature will enable you to dropship subcontractors with components. The Resupply Subcontractors can be employed to resupply subcontractors with the components. This will assist the manufacturer to supply materials to the subcontractors when needed. If the company possesses numerous warehouses, you can resupply components from one warehouse to another with these features.

You can easily resupply raw materials in warehouses when they are demanded. When the products go out of stock, you can produce them in the warehouse to resupply by enabling the Manufacture to Resupply option. You will receive three ways to set manufacturing procedures. By choosing the Manufacture option, you can transfer the components directly to the production area and initiate the manufacturing procedures. Under the Pick components and then manufacture method, you have to go through two steps.

First, you need to unload the components from the stock to the input location and then proceed to the production location for manufacturing. Once you have picked the components and manufactured the products, you can store them in the warehouse by using the Pick components, manufacture, and then store products option. Activating the Buy to Resupply feature, Odoo enables you to purchase raw materials to resupply and stock them in this warehouse. Clicking the Save button will save the information of the newly set warehouse.

The routes management window for this warehouse's operations can be accessed by clicking the Routes smart button in the upper right corner of the display.

4.2 Operation Types

You may quickly create new operation types in the Odoo 18 Inventory module with the help of the specific tools that are offered in the module. The Operation Types menu can be accessed from the Configuration menu, as seen below.

When this choice is made, a new window with details regarding the operation currently set up is opened. You can change the kinds of operations available by selecting them from the given list. In this case, we are going to create a brand-new Operation Type. Hence, click the New button.

In this window, you can create a new type of operation. In the appropriate field, you can define the operation type. In the relevant fields, put in the Sequence prefix, reservation method, Barcode, return type, create backorder, analytic costs, and Company.

The Reservation Method will decide the method through which goods in this kind of transfers ought to be preserved.

There, you have the sub options, like at confirmation, manually, and before scheduled date, as in the above image. That is, It is possible manually, at confirmation time, or even before the reserved date. To select the 'Ask' choice in the Create Backorder area while you confirm a transfer and ask your clients to choose if they desire a backorder on the selected items. Odoo18 will create a backorder of the remaining products automatically if the 'Always' option is selected. The remaining products will be canceled if the 'Never' option is selected. Select the Show Detailed Operation option if you want to show a complete stock operation on the picking lines.

The related fields on the Locations tab enable you to define the Default Source Location and Default Destination Location of the transfers of this operation type.

The operation type would be internal transfer, manufacturing, delivery, or receipt. All the other fields will change by a small percentage based on which Type of Operation you select. There are setup options for every type of Operation. The added fields that will appear on-screen, such as if you decide to have the type of operation as receipt, are mentioned below.

You have the freedom to select the most appropriate type of operation in product return through its insertion into the Operation Type for Returns field. The specific goods, locations, and lot/serial numbers of relevance shall automatically be completed in detailed operations by Odoo18.

4.3 Locations

There, storage location helps you to track product location in your warehouse.You can define the locations in your warehouses where the products are stored using the platform to set up and control different locations available in the Odoo18 Inventory module. You can control numerous stock locations within one warehouse. You might activate the Storage Location feature, which will assist you in monitoring product location in your warehouse, from the Inventory module's Settings menu.

On selecting the location options there, you will be directed to the given page. Information regarding the Locations, Location Type, Is empty, Is a dock location, Storage Category, and Company is given in this platform's list view. When discussing how to create a new location in Odoo 18, we will consider each of these options in further detail. You can accomplish this by choosing the New button.

The window to create a new location is shown above. You can provide the location name in the field given here. The Parent Location option enables you to enter the parent location that has this location. You can select the parent location from the drop-down menu. You can configure the tabs for Additional information, Logistics, and Cyclic Counting. The products stored at this location will have the inventory count automatically set at the given frequency if it is not equal to zero. You can select Location Type for the new one from the options. The location types include vendor location, view, internal location, customer location, inventory loss, production, and transit location.

Vendor location: Represents the location where goods come from when you purchase something.

Internal Location: Represents your own warehouses or storage areas.

Customer Location: Represents where goods go when you deliver to a customer.

Inventory Loss: Used for stock adjustments when products are missing or gained.

Production: Used during Manufacturing operations.

Transit: Used for dropshipping or multi-step delivery

View: Not a real location—used as a parent or container for other locations.

You can indicate the storage grouping that is being used in this location by filling out the Storage Category section. If multiple companies share this location, you can leave the Company box blank. By turning on the Is a Scrap Location? option, you can approve the placement of scrap and damaged products here. You can designate a location as a dock location by checking a boolean field in the Location form. This checkbox, located in the "Additional Information" section, allows you to define specific areas within your warehouse as loading/unloading docks.

The Barcode field allows you to enter the barcode that is used at this site. To have all amounts replenished at this place, use the Replenish Location function.

Add a line to the Cyclic Counting tab with the label "Inventory Frequency" in days. The date of the inventory count for the items stored at this location will be automatically entered at the designated frequency if the difference is more than zero. The date of the last inventory at this location will be shown in the Last Effective Inventory column. The Next Expected Inventory field will then show the date of the upcoming planned inventory depending on a cyclic schedule.

It provides the standard policy to recommend the exact location, the lot, etc., where the products will be taken from for this site. In the event of not being provided here any parent locations, there's a fallback done to the level of the product category where this technique may be imposed. Removal Strategies that can be utilized here are,

FIFO: Products or lots initially received will be taken out first.

LIFO: The last stocked products or lots will be emptied first.

Closest Location: The lots or products closest to the destination location will be shipped out first.

FEFO: The products/lots with the earliest feasible removal will be emptied first.

Least Packages: Products can be packed into packages. Therefore, the smaller package will be emptied from the inventory first.

Further, in the window of location, there are such special smart buttons for stocks and putaway rules. The button of Putaway Rules will come up with the window of the instructions to take products from a place to another, and Current Stocks button will give information of the latest stocks of this place.

4.4 Routes

The interface for managing and creating various operating routes is available via the Configuration menu of the Warehouse Management tools in the Odoo 18 Inventory module. Besides corporate data and route names, the user can navigate a preconfigured list of routes here.

To create a new inventory move route, select the New button.

You may input the name of the route in the Route field. The same fields can also indicate the Sequence, Supplied Warehouse, and Company. You may not fill the Company field if all companies in your database utilize the same route. In the section Applicable On, you can choose which areas this route may be chosen. You may choose from the Product Categories, Products, Packaging, Shipping methods, Warehouse, and Sales Order Lines provided here in line with the policies of your company.

The Add a Line button on the Rules tab enables you to add a description of the rules applied to this operation path. The steps outlined above can be utilized to create new rules for this route. Don't forget to save the changes by clicking the Save button at the end.

While configuring, you can define a specific operation path for every product in the Odoo database. You can find a particular field on the Inventory tab of the products management window, as depicted below, and choose the best path for a product's inventory movement.

4.5 Rules

The user is able to add new rules for inventory movements via the Inventory module's Configuration menu. By selecting the Rules option from the Warehouse Management menu, as shown below, a new window with the list view of the already configured Rules is opened.

This preview shows the Action, Source Location, Destination Location, Route, and Company information for each Rule. Similar to other platforms, Odoo makes sure that the core and flexible GroupBy and Filters capabilities are available to enable searching. You can go ahead and click the New button right away to see how to create a new rule in Odoo 18.

In the Name field, you can enter an appropriate title for the new rule. The second step is to specify the Action for the new rule. There will be a drop-down menu where you can choose the appropriate action to perform.

Pull From: This action can be set when goods are required in the desired location. It may be from a manufacturing order or a sales order. In case there is a requirement for a product at the destination point, Odoo will create a picking operation type from the source point to fulfill the need.

Push To: Using this rule, you can move a product. When the items have arrived at the beginning point, you can transport them to another location using this action. Odoo will create a pickup operation type to ship them to the destination in this instance.

Push and Pull: This is an activity that can be applied in the above-stated situations. A pick is taken from the source location when products are required at the destination point. Specifications of products are thus needed at the origin area. After the source point has met the requirements, products are pushed to the destination point to respond to the needs of the destination point.

Manufacture: Users can directly create manufacturing orders to fulfill the requirements of the source location with the assistance of this task.

Buy: When the product is required at the destination place, Odoo will utilize this action to fetch a quote for the purchase of the product.

The fields below enable you to select the operation type, source location, and destination location. In the Applicability tab, you can specify what Route, Warehouse, Company, and Sequence this rule is applied to. The supply method option determines how a product is sourced to fulfill a demand, especially when using push/pull rules. It dictates whether the product is taken from existing stock or if another rule is triggered to resupply.

The "Propagation" tab within a rule defines how the procurement group associated with a move or procurement is handled. It allows you to choose how related transfers are linked and determines whether a specific procurement group is applied to all transfers. In the Propagation tab, you can select Empty, Fixed, or Propagate for the propagation of the Procurement Group.

If the Cancel Next Move is set, the move that this rule created will be canceled and so will the next move. When the carrier propagation is turned on, the cargo carrier will propagate. For a new move or procurement, you can specify another warehouse in the Warehouse to Propagate field than the one for this rule.

4.6 Storage Categories

The Storage Categories functionality in Odoo will enable you to consolidate numerous storage locations under one category. You can define numerous such categories in the Odoo Inventory module that will be useful to execute intelligent put-away operations.

Prior to configuring the storage categories, you need to configure the storage locations that are present in your inventory. Then you can consolidate them under a particular category. By enabling the Storage Location from the Settings module, you are able to create and manage all storage locations in your business. Once you enable this feature, you will receive an extra field referred to as Storage Categories below to specify different categories for the available storage.

This window's list view will display the information concerning the available Storage Categories, Max Weight, Allow New Product, and Company. To add a new storage category, we can make use of the New button.

The name of the new storage category can be entered in the provided space. In addition to this, you can enter the maximum weight that can be stored under this category. If you wish to permit new products to the locations under this category, you can provide conditions for this in the Allow New Product field. You can permit new products if the location is vacant, if all products are identical, or permit mixed products.

In the Capacity by Package field, you can refer to the Package Type and its Quantity using the Add a line button that can be added in this category. The products that can be added to this storage category too, can be indicated in the Capacity by Products tab. Saving via the Save button will add a new storage category for your inventory. The intelligent Location button will provide the information of the location that has been included under this specific category.

4.7 Putaway Rules

An effective warehouse management system is responsible for products being kept at the right location in the warehouse. If the warehouse holds risky and hazardous items, you ought to take them under your protection by providing them with a separate place where you can keep them away from contact with other goods. For performing these operations automatically, the Odoo Inventory module brings forward the Putaway Rules that will guide you in pushing goods to rightful locations. This aspect will prevent improper storage of items in your inventory. With the putaway rules, you can move items from the receiving locations to the most suitable location in the warehouse itself.

The Putaway Rules window can be opened through the Configuration menu of the module. The following screenshot presents the list of previously set putaway rules. In this, you will be provided with the information of When the product arrives in, Product, Product Category, Package Type, Store to sublocation, Having Category, and Company.

It is simple to create new putaway rules in Odoo. Click on the New button and a new line will be created below the available list. In this, you can enter the product name, product category, and package type in the respective fields.

The receiving location of the product can be defined in the When product arrives in the field. In the Store to Sublocation field, you may include the location where you want the product that comes to the receiving location moved. The Sub-location Option in Odoo Inventory aids in deciding how products are allocated to various storage areas inside a warehouse when setting up Putaway Rules. Under Sub-location, the three primary choices are:

No (Stamped Out Location): The merchandise is always shipped to a certain, predetermined address. It is helpful in cases where products have fixed storage locations.

Last Used Location: Incoming stock is routed by the system to the product's most recent usage location. Perfect for goods that constantly switch storage locations according to the availability.

Closest Location: When a product arrives, Odoo automatically chooses the closest sublocation to store it. It is beneficial for maximizing warehouse space and cutting down on employees' commuting time.

You can specify the category of the sublocation in the Having Category field. You may follow by noting the Company and then click the Save button. When a product belonging to a specific product category in a specific package type reaches the destination location described here will be shifted to the said sublocation of the company by default. Finally go to the Save icon.

4.8 Product Categories

It is crucial to put in place a well-thought-out inventory management system that facilitates classification. Make use of Odoo ERP software, which makes it simple to create and modify product categories and enables flexibility in response to shifting business requirements. Review and update your categories frequently to account for new items or shifts in consumer preferences. Your inventory system will stay current and adapt to changing consumer demands thanks to this flexibility. For even more granularity, think about using subcategories. Dividing more general categories into more focused subcategories makes it easier to organize information precisely and makes searching easier for both customers and staff.

Start by opening Odoo 18's Inventory module and going to the "Configuration" section.

A thorough list of pre-configured product categories will be available once you arrive. These categories give you a starting point for inventory organization, making it simple to classify things like office supplies, apparel, and gadgets. Click the "New" button to create a new product category and start customizing your inventory structure. This stage is essential for customizing how your products are arranged to meet your unique business requirements.

Use the chance to methodically supply particular details as you explore the new product category's settings window. This entails entering details like the category name, description, and any pertinent characteristics that set the category apart. This methodical technique guarantees that your product categories are exactly in line with your company's needs, which helps to create an orderly and effective inventory management system.

You can give the newly formed category a relevant name in the "Category" column, which will make management and recognition easier. The "Parent Category" field indicates a higher category that might have lower subcategories, often known as kid categories. A systematic method for classifying and arranging products is introduced by this hierarchical arrangement. Consider the parent category "Electronics," for example, which acts as a large umbrella beneath which subcategories such as "Laptops," "Smartphones," and "Accessories" are nested. In addition to improving the items' organized layout, this hierarchical structure makes navigating easier and makes the system more effective and user-friendly.

Odoo and AvaTax work together smoothly to provide precise sales tax calculations for all US states and territories as well as all Canadian provinces and other territories. Beyond the fundamentals, it manages several Canadian tax components such as GST, PST, and HST, giving it a flexible option for companies doing business in both Canada and the US.

With its flexible removal methods that may be used at different source sites, the Force Removal Strategy stands out in the Logistics tab of the product category setup window. These methods are essential for picking operations optimization because they reduce worker distance, guarantee quality control, and manage products according to expiration dates.

First In First Out (FIFO), Last In First Out (LIFO), First Expiry First Out (FEFO), Least Packages, and Closest Location are the five main removal methods that cover a range of options, as shown in the accompanying figure. Every technique has a specific function in warehouse management.

FIFO (First In, First Out):

This method prioritizes picking products that entered the warehouse first. It's suitable for perishable goods or items with short shelf lives.

LIFO (Last In, First Out):

This method picks products that entered the warehouse most recently. It's commonly used for products without a shelf life or where the order of use doesn't matter.

FEFO (First Expiry, First Out):

This strategy prioritizes picking products with the nearest expiration date. It's crucial for items with limited shelf lives, ensuring products are used before they expire.

Least Packages:

This strategy prioritizes picking products with the fewest remaining packages. It can help optimize inventory and reduce handling time by minimizing the number of packages picked.

Closest Location:

This strategy prioritizes picking products based on their physical location within the warehouse. It minimizes travel distances for warehouse staff, especially when multiple locations hold the same product.

By concentrating on the actual locations of things within the warehouse, the "Closest Location" approach departs from chronological order. This strategy offers a different approach to strategic inventory management and is frequently used for products that retain a constant level of quality throughout time.

Both the Income Account and the Expense Account for the product category must be specified under the Account Properties tab.

The "Income Account" in Odoo's product category settings is usually linked to the money received from a product's sale. The goal of this account is to carefully monitor the money coming in from product sales. On the other hand, the "Expense Account" is closely related to the charges or expenses related to the product. It is essential for keeping track of the costs associated with the product's purchase or manufacture. You may effectively manage and classify your financial activities by configuring these accounts inside the product category settings, which guarantees a thorough picture of both sales income and cost of goods. The downpayment accounts option A down payment account is a particular type of accounting account that is used to track payments made in advance to a vendor or client. These payments are paid prior to the completion of the invoice or the actual delivery.

Costing techniques are essential to Odoo inventory valuation since they give companies a variety of choices to suit their particular requirements. One such strategy is the "Standard Price," which keeps the cost per unit constant despite price swings in the market. Despite the fact that actual cost changes are dynamic, this constant number never wavers.

A more flexible approach to valuation that takes into account the continuous fluctuations in costs is provided by the "Average Cost" method, in which the system dynamically determines the mean cost of every unit in stock.

The "First In First Out (FIFO)" approach ensures a systematic flow that reflects the chronological order of acquisitions for those who value chronological accuracy by assuming that the first products entered to the inventory are the first to be sold.

Under the inventory valuation, you have the costing method and inventory valuation options.

Inventory Valuation Method defines whether the stock journal entires need to be record during a delivery or receipt.

Manual: Requires you to manually update inventory values based on physical stock counts.

Automatic: Automatically updates inventory values based on purchase prices and other relevant data.

Another section Reserve Packagings in product category can be reserved in full or partial quantities for outgoing shipments. Partial packaging flexibility expedites order fulfillment by allowing the immediate shipment of available items, while awaiting the rest.

To configure packaging reservation methods, go to Inventory app ‣ Configuration ‣ Product Categories. Then, click New, or select the desired product category.

On the product category’s form, in the Logistics section, Reserve Packagings can be set to Reserve Only Full Packagings or Reserve Partial Packagings. To see the Reserve Packaging field, the Product Packaging feature must be enabled. To enable this feature, go to Inventory app ‣ Configuration ‣ Settings, scroll to the Products section, tick the Product Packagings checkbox, and click Save.

Take a look at the following example to better assess the possibilities according to business needs:

Each package contains twelve units of a product. The order requires two packages. Only twenty-two units are available. Only twelve pieces are set aside for the order when Reserve Only Full Packagings is chosen.

In contrast, 22 units are set aside for the order when Reserve Partial Packagings is chosen.

These various methods give companies the freedom to modify their inventory value plans in accordance with particular requirements and current market conditions. Whether choosing the consistency of Standard Price, the flexibility of Average Cost, or the timeliness of FIFO, Odoo's strong platform forms the basis for thorough inventory control.

4.9 Package Types

In the Odoo Inventory module, you can define and manage various package types to better organize and handle different product packaging needs, including delivery operations. These package types are configured through the Configuration menu, allowing you to define specifics like size, weight, and carrier details.

Here, you can see the options like carrier, package type, height, width, length, max weight, and carrier code. To create a new one, go to the New icon.

Here, you can add the above mentioned details as well.