Stock Reservation from Orders

Stock Reservation from Orders

Stock reservation is a critical inventory management feature that ensures you can fulfill customer orders by reserving inventory when orders are created. This prevents overselling and helps you manage stock availability more effectively.

Understanding Stock Reservation

Stock reservation means:

• When a sales order is created, the ordered quantities are "reserved" in your inventory
• Reserved stock is not available for other sales but remains in your physical inventory
• This ensures you have stock available when it's time to fulfill the order
• Reserved stock is released when the order is cancelled or converted to invoice
• Helps prevent double-selling of the same inventory

How Stock Reservation Works

Automatic Reservation

When you create a sales order:

1. System checks if stock tracking is enabled for the items
2. Verifies available stock quantity
3. Reserves the ordered quantity (if stock is available)
4. Updates available stock (available = total - reserved)
5. Order status may affect when reservation occurs

Reservation Timing

Stock reservation typically happens when:

• Order status changes from "Draft" to "Pending" (confirmed order)
• Order is created with "Pending" status directly
• Order is confirmed by you or the customer

Note: Draft orders usually don't reserve stock to allow flexibility during order creation.

Reservation Process

1. Order is created with items and quantities
2. System checks stock availability for each item
3. If stock is available, quantities are reserved
4. Available stock decreases by reserved amount
5. Reserved stock increases by the same amount
6. Order shows reserved stock information

Viewing Reserved Stock

In Order Details

• Open any sales order
• View reserved quantities for each item
• See total reserved stock for the order
• Check reservation status

In Inventory Reports

• Navigate to Reports → Inventory Reports
• View stock summary showing:
  • Total Stock
  • Reserved Stock
  • Available Stock (Total - Reserved)
• Filter by item, location, or date

Stock Levels View

• Go to Items → Stock Levels
• See reserved stock for each item
• View which orders have reserved stock
• Check reservation details

Stock Availability Scenarios

Sufficient Stock Available

• Ordered quantity is less than or equal to available stock
• Stock is reserved successfully
• Order can be fulfilled
• Available stock decreases accordingly

Insufficient Stock

• Ordered quantity exceeds available stock
• System may:
  • Reserve available quantity and flag shortage
  • Show warning message
  • Prevent order confirmation (depending on settings)
  • Allow backorder creation
• You'll need to:
  • Procure additional stock
  • Reduce order quantity
  • Cancel the order
  • Wait for stock replenishment

No Stock Available

• Item is out of stock
• Order cannot reserve stock
• System will alert you
• Options:
  • Create backorder
  • Cancel the order
  • Wait for stock arrival

Releasing Reserved Stock

Reserved stock is released in the following scenarios:

Order Cancellation

• When an order is cancelled
• All reserved stock is immediately released
• Stock becomes available for other orders
• Automatic process - no manual intervention needed

Order Conversion to Invoice

• When order is converted to invoice
• Reserved stock is converted to actual sale
• Stock is deducted from inventory
• Reservation is cleared
• This is the normal fulfillment process

Partial Fulfillment

• When only some items are delivered
• Reserved stock for delivered items is released and converted to sale
• Reserved stock for pending items remains reserved
• Order status updates to "Partially Fulfilled"

Manual Release

• In some cases, you may manually release reserved stock
• Useful if order is on hold indefinitely
• Should be done carefully to avoid fulfillment issues
• May require approval depending on settings

Multi-Location Stock Reservation

If you have multiple locations/branches:

Location-Specific Reservation

• Stock is reserved from the specific location/branch
• Each location maintains its own reserved stock
• Orders are fulfilled from the assigned location
• Cross-location transfers may be needed

Location Selection

• Specify location when creating order
• Stock is reserved from that location
• Can transfer stock between locations if needed
• Location-specific stock reports available

Reservation Alerts and Notifications

Low Stock Alerts

• Get notified when reserved stock causes available stock to fall below threshold
• Helps you plan procurement
• Prevents stockouts

Reservation Warnings

• Alerts when creating orders with insufficient stock
• Warnings for orders that cannot be fulfilled
• Notifications for high-value reservations

Stock Availability Updates

• Notifications when stock becomes available for pending orders
• Alerts when reserved stock is released
• Updates on stock replenishment

Managing Reserved Stock

Reviewing Reservations

• Regularly review reserved stock levels
• Identify orders with long-standing reservations
• Check for reservations on cancelled orders
• Monitor reservation trends

Optimizing Reservations

• Release reservations for orders that won't be fulfilled
• Prioritize reservations based on order dates
• Coordinate with procurement for stock replenishment
• Balance reservations across locations

Reservation Reports

Use reports to analyze stock reservations:

Reserved Stock Report

• Total reserved stock by item
• Reserved stock by location
• Reservations by order
• Reservation aging (how long stock has been reserved)

Stock Availability Report

• Total stock vs. reserved stock
• Available stock levels
• Items with high reservation rates
• Stock that's fully reserved

Order Fulfillment Report

• Orders with reserved stock
• Orders waiting for stock
• Reservation to fulfillment timeline
• Reservation efficiency metrics

Best Practices

• Enable stock tracking for items you want to reserve
• Regularly review reserved stock to ensure it's still valid
• Release reservations promptly for cancelled orders
• Monitor stock levels to ensure sufficient inventory
• Set up alerts for low available stock
• Coordinate reservations with procurement planning
• Use reservations to plan production schedules
• Review reservation reports regularly
• Balance between reserving too much (tying up inventory) and too little (risk of overselling)
• Train team on reservation concepts and processes

Troubleshooting

Stock is not being reserved?

• Check that stock tracking is enabled for the items
• Verify that order status allows reservation (usually "Pending" or confirmed status)
• Ensure items have stock tracking enabled in item settings
• Check inventory module activation

Reserved stock is not releasing?

• Verify that order cancellation or conversion was successful
• Check for system errors in stock update process
• Review reservation release settings
• Contact support if issue persists

Available stock shows negative?

• This may happen if reservations exceed total stock
• Review and cancel unnecessary reservations
• Check for data inconsistencies
• Reconcile stock levels

Can't fulfill order even though stock shows available?

• Check if stock is reserved for other orders
• Verify location-specific stock availability
• Review reserved stock for the item
• Check if stock is in a different location

Effective stock reservation management ensures you can fulfill customer orders reliably while optimizing your inventory levels!