ANS-0670 · INVENTORY & ITEM MANAGEMENT
How to Track Inventory ‘On The Water’ in NetSuite for FOB Origin Shipments?
Implement a dedicated 'On The Water' location and utilize NetSuite's Inventory Transfer Orders to manage goods in transit effectively.
Short answer
For FOB Origin shipments, create an 'On The Water' location. Receive Purchase Orders into this location. When goods arrive at the final warehouse, use an Inventory Transfer Order to move them from 'On The Water' to the 'Warehouse Location'. This method ensures accurate tracking of inventory in transit.
Scenario
Organizations often need to track inventory that is purchased under FOB Origin terms, where ownership transfers at the point of shipment, but the goods have not yet physically arrived at their final destination warehouse. This creates a requirement to account for inventory that is 'on the water' or in transit, ensuring accurate stock visibility and financial reporting before physical receipt.
Solution
To effectively manage inventory designated as 'On The Water' for FOB Origin Purchase Orders, follow these steps:
Establish a dedicated inventory location within NetSuite, such as ‘On The Water’. This location will serve as a temporary holding point for goods in transit.
Upon creation of the Purchase Order, ensure it is received into the newly created ‘On The Water’ location. This action records the inventory as owned but not yet physically present at the final warehouse.
When the goods physically arrive at the customer’s designated warehouse, initiate an Inventory Transfer Order. This order will facilitate the movement of items from the ‘On The Water’ location to the final ‘Warehouse Location’.
Fulfill the Inventory Transfer Order from the ‘On The Water’ location and subsequently receive the items into the ‘Warehouse Location’ to complete the inventory movement and update stock levels accurately.
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