This guide will help you get started with Odoo Inventory. Once you are done, you will benefit from:
- Automated flows: from sale to delivery, and purchase to reception
- Inventory forecast and automated replenishment rules
- Streamlined logistic flows
- Accurate visibility on all your operations
In short, you will get a more efficient warehouse management that will lead to inventory reduction and better efficiencies in your daily operations.
If you need help, do not hesitate to contact our experts using the button on the top bar.
For the Odoo Team,Fabien Pinckaers, Founder
Odoo uses the concept of Warehouse as a building where you stock your goods. Typically, a small business as only one warehouse (or more likely, a storage room), but as your company grow, you may need to manage several storage facilities.
Configure your warehouses:
By default, Odoo has one warehouse preconfigured: you can edit its details here.
You can create additional Warehouses from the Configuration/Warehouses menu: each new warehouse will appear in your dashboard.
Warehouse Locations
To better organize your stock, you can create subdivisions of warehouses called locations (ex: Shipping area, Merchandise return, Shelf 34 etc). As this configuration requires more operations to record, it's recommended to start without locations if you did not manage inventory per zone in the past.
Unless you are starting a new business, you probably already have a list of vendors.
To import your vendors, you can either:
- Create each one manually, the easiest way if you only have a few.
- Use the Import function, available from the Vendors list view.
- Or better yet, send your Odoo Project Manager the file containing all your data (CSV, XLS, XLSX or ODS) and he will gladly do the importation for you.
Before creating your products, here are a few concepts your should understand:
Product Types
- Stockable products are subject to the full inventory management system: minimum stock rules, automatic procurement, ...
- Consumable products are always assumed to be in sufficient quantity in your stock, therefore their available quantities are not tracked.
Supply Chain
- Manufacture: the product is manufactured internally or the service is supplied from internal resources.
- Buy: the product is bought from a vendor, through a Purchase Order.
- Make to Stock: your customers are supplied from available stock. If the quantities in stock are too low to fulfill the order, a Purchase Order (according the minimum stock rules) will be generated in order to get the products required.
- Make to Order: the product is acquired only as demand requires (meaning each time a Sales Order is confirmed). This will not modify stock in the medium term because you restock with the exact amount that was ordered.
On Hand / Available Quantities
- On Hand products are physically located in the warehouse location at the current time. This includes items that are already allocated to fulfilling production needs or sales orders.
- Available products are currently available for use in filling a new order for purposes such as production or distribution. This quantity does not include items already allocated to other orders or items that are in transit from a supplier.
Units of Measure
- By default, Odoo measures products by 'units', which are a generic and can represent just about anything.
- To use more precise units like pounds or kilograms, activate Some products may be sold/purchased in different unit of measures (advanced) in the Inventory Settings.
- Your can review and edit the pre-defined units via the Units of Measures configuration menu.
- Of course, feel free to add your own; just remember that Odoo can convert units within the same category (for example, liters to gallons in the volume category).
Reordering Rules
- Reordering rules can be used to automatically replenish your products: if the quantity on hand of a product for a given location is lower than the minimum indicated in the rule, Odoo will automatically propose a procurement to increase its quantity to the maximum level given in the rule.
- The easiest way to create a reordering rule is through the Reordering button on a Product; then, simply enter a minimum and maximum quantity.
Recommended if <100 products
Recommended if >100 products
We can handle the whole import process for you: simply send your Odoo project manager a CSV file containing all your products.
If you want to do it yourself:
- Download the Excel template
- Import using the top left button in the list of products
Making an inventory is the act of matching the theoretical quantities of your products in Odoo, to the real on-hand quantities in your stock.
To begin your inventory:
- Create a new Inventory Adjustment (e.g., Starting Inventory) from the Inventory Control menu.
- Select the Location you want to inventory (one is proposed by default if you only have one warehouse).
- Click on Start Inventory, then for each listed Product, enter their quantity in the Real Quantity column
- Validate the inventory.
All your product have their Quantities set correctly.
It is also possible to import your initial inventory from an Excel or CSV file. If you want to do that, contact your Odoo project manager.
In Odoo, inventory management is fully integrated with the sales and invoicing process. That means you can automate everything from the initial quotation, to the goods delivery and final invoice.
To better understand a complete sales flow, try to follow the following steps.
From the Sales application:
- Create a Quotation with a customer and some products: for each item, Odoo will check if you have enough stock on hand.
- Transform it to a Sales Order by clicking on Confirm Sale: this will automatically create a corresponding Transfer Order.
- Use the Transfers button on the Sales Order form to access it (you can of course also retrieve it from the Inventory Dashboard)
From the Inventory application:
- If your products supply chain is properly configured, the transfer should be marked as 'Ready to Transfer'. Otherwise, Check the availability manually.
- Validate the Delivery either by processing it one line at a time by clicking on the button, or as a whole with the Validate button
Now a similar exercise but for a purchase flow:
From the Purchases application:
- Create a Request for Quotation (or RFQ for short) to your vendor, add the products and their desired quantities, and send it by fax or email.
- Transform it to a Purchase Order by clicking on Confirm Order: this will automatically create a corresponding Transfer Order.
From the Inventory application:
- When you receive the ordered products, access the Incoming Shipments via the Dashboard.
- Process the products either manually by clicking on the button on the product lines, or scan them with the Odoo Barcode app.
- Validate the Receipt Order to mark the products as transferred to your stock location.
Back to the Purchases application:
- Find the original Purchase Order and print the invoice.
A good inventory management aims to optimize stock levels: not too low (or you may find yourself out of stock) and not too high (your products occupy space and may loose value).
Analyze your stock level at least once a month by generating a few reports:
- Stock Level Forecast look for rapidly increasing / decreasing stock level compared to last month
- Stock Valuation look for high inventory value combined with a high product quantity
Then, adapt the Reordering Rules to reduce or increase the stock level (just be careful to only make small changes over time).
If you configured automatic procurement, Odoo will automatically generate Procurements Orders. You usually don't need to worry about them, but sometimes, the system can remain blocked without generating a corresponding document, usually due to a configuration problem.
It is therefore a good idea to check and try to resolve those procurement exceptions, accessible from the Schedulers menu (you need the Stock Manager role to see it).
Here are some usual problems and their solutions:
- No bill of materials defined for production: you need to create a BoM or indicate that the product can be purchased instead.
- No supplier available for a purchase: you have to define a supplier in the Procurements tab of the product form.
- No address defined on the supplier partner: you have to complete an address for the default supplier for the product concerned.
- No quantity available in stock: you have to create a reordering rule and put it in the order, or manually procure it.
Packages allows you to ship products by boxes, pallets, packs or whatever logistic unit you may need.
To use Packages:
- Activate Record packages used on packing in your Inventory Settings.
- Activate Technical Features on your user account.
- Use the Configuration > Packages menu to edit or create your Packages
Once your Packages are defined, you can attribute them to your products via the Inventory tab of the Product form.
Odoo can run advanced traceability by using Product Lots and Serial Numbers, usually identified by bar codes stuck on the products.
Lots can be encoded on incoming shipments lines, internal moves and outgoing deliveries, and later can be separated into smaller lots depending on the quantities ordered, but they will always keep their initial lot number so you can track them.
To use Lot Tracking:
- Activate Track lots or serial numbers in your Inventory Settings.
- When you process a Purchase order, assign a lot number to a group of products by clicking on the icon (e.g. 0001)
The lot number you created will be displayed next to the item's location. To track the lot, go into Traceability > Serial Numbers.
Odoo can manage advanced push / pull routes configuration, for example:
- Manage product manufacturing chains.
- Manage default locations per product.
- Define routes within your warehouse according to business needs, such as Quality Control, After Sales Services or Supplier Returns.
- Help rental management, by generating automated return moves for rented products.
This is quite complex to set up, so contact your Projet Manager and he will take care of this for you.
Imagine the following situation: you ask your accountant for an inventory valuation or the value added by production, he will give you a figure. If you ask for the same valuation from your inventory manager, he will probably give you an entirely different figure.
That's because by default, Odoo is configured to do a periodic inventory valuation.
The alternative is to use a real-time inventory valuation, which gives a complete and permanent coherence between accounting and inventory.Indeed, each stock movement will generate a corresponding accounting entry.
To activate real-time inventory valuation:
- In the Accounting app, set up a General Account for each location that should be valued in your accounts.
- Back in the Inventory app, select the Perpetual inventory option for Inventory Valuation in the Inventory Settings.
- Define the following accounts, either on the product category (Accounting Stock Properties tab) or on the product itself (Accounting tab):
- Stock Input Account
- Stock Output Account
- Stock Valuation Account
Congratulations!
We hope this guide helped you implement Odoo Inventory.
Don't hesitate to send us an email to describe your experience or to suggest improvements!
Once it's fully working, give us some feedback: we love to hear from our customer. It would be great if you can send a photo of your warehouse to feedback@mail.odoo.com
Enjoy your Inventory management with Odoo!
- The Odoo Team
