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Managing Transfer Orders within the Same Company in Different Locations

Jun Wang Profile Picture Jun Wang 5,659 Super User

Managing Transfer Orders within the Same Company in Different Locations Using Business Central
When processing transfer shipments and transfer receipts in Microsoft Dynamics 365 Business Central, the system automatically updates inventory records to reflect item movement between locations. Here's an overview of how this process works and what records are created to ensure accurate inventory management.
Understanding Transfer Orders
A transfer order in Business Central is used to move inventory items from one location to another within the same entity. This is particularly useful for businesses with multiple warehouses or storage locations.
Example Scenario: Transferring Items Between Locations
Let's consider a scenario where we need to transfer item XYZ from Location A to Location B.
Step-by-Step Process:
  1. Initial Inventory at Location A:
    • Location A has 10 items of XYZ.
  2. Posting the Transfer Shipment:
    • When you post the transfer shipment, Business Central reduces the inventory at Location A by the quantity being transferred. In this example, 2 items are transferred.
    • The inventory at Location A is now reduced from 10 to 8.
    • The transferred items (2 in this case) are put into an "in-transit" status, which can be visualized as a truck on the road transporting these items.
  3. In-Transit Inventory:
    • While the items are in transit, Business Central keeps track of them separately. This ensures that both the source location (Location A) and the destination location (Location B) are accurately updated.
    • Users can see the in-transit status within the system, allowing them to monitor the progress of the transfer.
  4. Posting the Transfer Receipt:
    • Once the items arrive at Location B, the user posts the transfer receipt.
    • Business Central then reduces the in-transit inventory by the received quantity and adds these items to the inventory at Location B.
    • Thus, Location B’s inventory is updated to include the 2 newly received items.
System Records Created
During this process, Business Central creates and updates several records to ensure all movements are accurately tracked:
  1. Posted Transfer Shipment:
    • This record is created when the transfer shipment is posted. It reflects the reduction of items from the source location and the addition of items to the in-transit status.
  2. Posted Transfer Receipt:
    • This record is created when the transfer receipt is posted. It reflects the removal of items from the in-transit status and the addition of items to the destination location.
Special Considerations
If your locations require warehouse shipment and warehouse receipt processes, you need to create and post these documents as well. This adds another layer of control and tracking, ensuring that all inventory movements are thoroughly documented and verified.
Conclusion
The transfer order process in Business Central is designed to streamline inventory management across multiple locations within the same entity. By automatically updating inventory records and creating necessary documents like posted transfer shipments and receipts, Business Central ensures accurate and efficient tracking of item movements. This functionality helps businesses maintain precise inventory levels and optimize their logistical operations.

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