Inventory Movement

Understanding how inventory moves through LOU can help you keep track of inventory and spot when there may be an issue to mitigate loss.

Check out How Transactions Post to the General Ledger for information on how transactions affecting Inventory impact your General Ledger.

The information below describes how the Inventory moves through LOU in various scenarios. Not all these scenarios are a transaction that impacts the General Ledger.

SKU Statuses

• On Hand: Total number of SKUs in your possession.
• Reserved: SKUs still in your possession, but on a Pending Order
• Available: Total number of SKUs in your possession which are neither Reserved or Delivered.
• On Order: SKUs on a Pending PO that has been ordered and not yet received.
• Estimates: SKUs on a Pending Estimate

Add Inventory to LOU

Before you can sell it, you have to account for it in Inventory. There are two majors ways to add Inventory to LOU: Purchase Orders and Stock Adjustments.

Purchase Orders

• This is the most common way to add Inventory. Purchase Orders, or POs, created in LOU can be sent to the Vendor if they allow, but most Vendors have a preferred ordering process. POs in LOU are primarily used as your record that an order was placed.
• Once the Purchase Order status has been updated to Placed On Order, the SKUs on the PO will show under the On Order column of SKU Details on the Inventory Search page.
• Once you physically receive the order from the Vendor, Receive Inventory in LOU to add the quantity to Inventory. This will move SKUs from showing as On Order to showing as Available and On Hand.

Perform a Stock Adjustment

• This method can both increase and decrease Inventory, depending on whether you adjust as a positive integer or a negative integer.
• While this method will impact quantities and the Inventory Valuation Log, it will not create a Purchase Receipt for the adjustment.
• This method is most often used to correct quantities rather than documenting a purchase. If you purchased the item and need to add it to Inventory, it’s best to create the PO and go through the Receive process.
• This method is used by LOU’s Physical Count feature to correct counts at the end of the process.
• Stock Adjustments only affect the On Hand and Available columns of the SKU Details section of Inventory Search.

Stock Transfers

Stock Transfers do not increase or decrease quantities on hand overall. Instead, they move existing quantities between Stock Site locations. The number of Available SKUs is increased or decreased by a Stock Transfer, but the overall Company QOH remains the same.

Inter-Company Purchase Orders (ICPOs)

ICPOs do not increase or decrease quantities on hand. Rather, they serve as Stock Transfers for those instances where you are moving SKUs between Stock Sites which are in different locations. SKUs remain Available and simply change Stock Site locations.

Add SKUs to an Order or Estimate

You can add any Active SKU to an Order or Estimate regardless of quantities on hand. Estimates can be promoted to an Order without the quantity on hand to cover. SKUs are not removed from Inventory and considered Sold until they are invoiced.

Estimates

• Do not require QOH for SKU to be added
• Do not require QOH for Estimate to be promoted
• SKUs added to an Estimate display under the Estimates column on SKU Details.

Work Orders and Sales Orders

• Do not require QOH for SKU to be added
• Invoicing without sufficient quantity results in a warning. See below for details.
• SKUs added to an Order display under Reserved on SKU Details while the Order is in Pending Status.
• Invoicing an Order reduces QOH and is removed from Reserved on SKU Details.

Insufficient Quantities to Invoice

If you attempt to invoice an Order without quantities on hand to fulfill it, LOU will warn you that continuing will result in a negative quantity. This gives you the chance to back out and correct the Inventory levels before invoicing.

However, if you choose to invoice in the negative, LOU will let you proceed. Be aware that this will result in $0 being posted to the COGS and Miscellaneous Revenue GLs and impact your Inventory Valuation Log. Once you receive or adjust inventory, that transaction will post to COGS and the Inventory Valuation Log, bringing everything back into balance.

Inventory Movement Setup

There are several places where you configure important settings to guide LOU in moving Inventory.

• Stock Sites: Locations that store Inventory
• Stock Site Selection Matrix: When a SKU is added to an Estimate or Order, what location should it sell from?
• Vehicle Stock Site Links: Service vehicles carrying Inventory can be designated as Stock Sites to be sold from on Orders with associated Tasks.
• Transfer Inventory to Vehicles: Move Inventory from a stationary Stock Site to a vehicle Stock Site.