SAP B1 blog

Fully integrated for effective warehouse management

SAP Business One is more than just a software. It is a tool that helps you keep track of your stock levels, from purchasing and sales processes to stock valuation methods. It also offers functions for manual Inventory Transactions, pricing and inventory.

But let's dive deeper into warehouse organisation. In SAP Business One you can create as many warehouses as you like, which can be completely separated during warehouse management. These warehouses do not necessarily have to be physically separated. It is just as possible that you have main and spare parts warehouses in the same warehouse, but want to separate them for logistical reasons.

Another aspect that makes the SAP Business One warehouse organisation unique is the possibility to map the physical subdivisions of the warehouse with up to four levels. These can be, for example, rows, aisles, shelves, boxes, containers, cartons, crates, bins, etc. This means that the storage bin is the smallest usable spatial unit in the warehouse. This function enables precise and efficient warehouse management by facilitating the location and movement of items within the warehouse.

In this blog post we will focus on the basics of warehouse organisation in SAP Business One. We will highlight the different aspects of warehouse management, from the definition of warehouses and their attributes to the warehouse valuation methods available.

Basic principles for warehouse management in SAP Business One

The warehouses created are the basis of warehouse management in SAP Business One. It is possible to create a large number of warehouses that can be completely separated from each other in terms of managing the warehouse. This includes item cost calculation, minimum stock response, etc.

The warehouses you create in SAP Business One are logistically related. Each unit that you consider logistically relevant should have a warehouse in SAP Business One. A general warehouse, a spare parts warehouse, a sub-warehouse, a production warehouse, an intermediate warehouse or a scrap warehouse are some examples. Usually, warehouses are physically separated, but as mentioned earlier, this does not have to be the case for warehouse management. Some examples:

• Bulk storage for reserve stocks
• Duty-free warehouse, for imported goods that have not yet been declared
• Quality assurance for random sampling and goods inspection
• Drop shipment warehouse for deliveries from the supplier directly to the customer
• Returns warehouse, as ownership remains with the customer
• E-commerce warehouse to guarantee high availability

For each warehouse it can be defined whether the available quantities of this warehouse are to be taken into account in the disposition or not. Optionally, a warehouse can also be assigned a different G/L account or a different VAT identification number can be assigned. This may be necessary, for example, for a warehouse abroad.

Before creating or transferring item master data, early and sensible warehouse organisation is an important aspect of system initialisation and well-designed warehouse management. Using a numerical code at the beginning of the name can ensure that warehouses are properly arranged and findable.

Standard storage bin in SAP Business One

Order is essential in warehouse management. Good warehouse management can increase productivity, reduce errors and ultimately increase customer satisfaction. The ability to designate a default storage bin is a feature of SAP Business One that can help maintain this order. But what exactly does this mean? Remember that you have a warehouse with multiple storage bins. Each bin is dedicated to specific item types. You want to make sure that the items go to the right storage bin after you have received goods. This is the "Force default bin" option.

For a goods receipt, items only need to be placed in the default bin if you select the 'Force default bin' checkbox in SAP Business One. This means that regardless of where the item is actually stored, SAP Business One automatically selects the default bin for the goods receipt. This can help keep the warehouse tidy and make warehouse management more effective. However, this is not the only benefit within the warehouse organisation in SAP Business One. You can also use it to ensure that items always go to the right place by enforcing a standard storage bin. This can minimise the error rate and increase the accuracy of your stock levels.

Manage item costs per warehouse

One task of warehouse organisation is to make the costs of each item transparent. SAP Business One offers a function that allows you to manage item costs per warehouse. But what does that actually mean?

Imagine you have several warehouses. Not all warehouses are the same - some may be located in areas with higher operating costs, others may require special storage conditions that incur additional costs. In such cases, it makes sense to calculate the cost of each item differently depending on the warehouse. SAP Business One allows you to do just that.

SAP Business One allows you to select the checkbox "Manage item costs per warehouse" if you want the warehouse valuation method to be applied separately for each warehouse. If you check this option, for example, the moving average price calculated for each individual warehouse and not for all warehouses together. This allows for more accurate cost control and can help you make more efficient decisions.

But how does this work in practice? Let's say you have an item that is stored in two different warehouses. In warehouse A, the operating costs are higher than in warehouse B. If you have a goods receipt in warehouse A, you can include the higher cost in the item cost. If the same item arrives later in warehouse B, you can adjust the item costs according to the lower operating costs of warehouse B. In this way, the item costs in SAP Business One reflect the actual costs of each warehouse.

It is important to note that this function requires close and continuous monitoring. But don't worry, SAP Business One provides the necessary tools and reports within the warehouse organisation to facilitate this process.

Overall, item cost management per warehouse is a powerful feature in SAP Business One that can help improve the accuracy of your cost calculations and ultimately increase your profitability with this part of the warehouse organisation.

The stock transfer in SAP Business One

Stock transfer is an essential aspect of warehouse management. It allows you to move items from one storage location to another to efficiently manage inventory and ensure smooth business operations. SAP Business One provides a function that simplifies and streamlines this process.

But what does that mean exactly? Imagine you have an item that is no longer needed in a certain storage bin, but is missing from another storage bin. Instead of moving the item manually and updating the stock manually, you can perform a stock transfer in SAP Business One.

In SAP Business One you can perform a stock transfer in the same way as a goods receipt. You can select a business partner and a contact person to appear on the document printout. This can be particularly useful when you are transferring items between different locations or departments. When transferring stock in SAP Business One, you can also select a business partner to appear on the document printout. This can be particularly useful if you are transferring items to a customer or supplier. You can print the name of the business partner on the document printout to ensure clear and accurate documentation of the stock transfer.

Inventory transfer in SAP Business One is therefore another component of an efficient solution to optimise your warehouse management. It enables accurate control of item movements in your warehouse and can help improve the efficiency and accuracy of your warehouse management.

Automatic assignment at output

Warehouse management can be a complex task, especially when it comes to allocating items for goods issue. SAP Business One offers a feature that can simplify this process: automatic allocation on issue.

But what does that mean exactly? Imagine you have a goods issue, e.g. a sale or a delivery. You have to decide which items should be taken out of your warehouse. This is where the function "Automatic allocation on issue" comes into play.

In SAP Business One you can set different options for the automatic allocation of items at goods issue. These options can be set at the item, warehouse or storage bin level. For example, you can specify that items are to be allocated according to FIFO principle (First In, First Out) or be withdrawn according to the principle of the shortest expiry date.

But that's not all. This feature can also help improve the efficiency of your warehouse management. By using automatic allocation on issue, you can speed up the item withdrawal process and reduce errors. You can also ensure that the items in your warehouse are used optimally, for example by selling the oldest items first.

Inventory in SAP Business One Warehouse Management

Periodic inventory is at the heart of warehouse management. This cyclical count is necessary to match quantities in SAP Business One with their physical counterparts in the warehouse. Assigning cycle codes to each item and warehouse facilitates this periodic count.

SAP Business One offers two types of inventory documents as standard:

Inventory count: This document is a list of the items to be counted and the persons responsible for the count. It is also possible to lock the items to be counted to protect them from being issued. Prepared in this way, a count sheet can be printed out to serve as a practical guide to the counting process. After counting, the quantities can be entered into the count sheet. If manual entry is too time-consuming, SAP Business One allows the relevant data to be imported from MS Excel.

Stock posting vouchers: These vouchers are used to eliminate discrepancies between the counted quantities and the stock quantities recorded in the system. The stock entry vouchers allow you to enter the item cost and post the difference to adjust the stock.

Inventory reports

In warehouse management, it is essential to keep track of current inventory. SAP Business One offers a range of inventory reports to help you keep track and make informed decisions.

One of the most important reports is the "Stock Report". This report shows the current stock level as an overview or detail report. You can limit the display in the window "Stock report ? Selection Criteria" window with regard to item, warehouse and location. In addition, you can use the checkbox "Hide items with zero stock quantity" to display only those items that also have stock in store.

Another useful report is the "Stock Status" report. This report shows the same components for calculating the available quantity (In Stock Confirmed + Ordered = Available Quantity) as in the Item Master Data window on the Inventory tab.

In addition, SAP Business One provides the "Inventory Posting List" report. This report works along similar lines to the sales analysis in the Sales module and the purchasing analysis in the Purchasing. You can run the report by item, by business partner and by other criteria, such as sales representative, project or supplier catalogue number.

These reports and many others allow you to keep an accurate overview of your inventory and make informed decisions. They are another example of how SAP Business One can help you optimise your warehouse management and improve your business processes.