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Dynamics NAV Warehouse Management Overview

This Article provides you with an overview of the concepts and principles that are used in the Dynamics NAV Warehouse Management features. It explains the design behind a central warehouse features and how warehousing integrates with other supply chain features.

To differentiate the different complexity levels of warehousing, this documentation is divided into 2 general groups, Basic and Advanced warehouse configurations, indicated by section titles. This simple differentiation covers the different complexity levels as defined by product granules and location setup.

NAV Warehouse Management Overview

To help the physical handling of items on the zone and bin level, all information must be traced for each transaction or movement in the warehouse. This is managed in the Warehouse Entry table. Each transaction is stored in a warehouse register.

Warehouse documents and a warehouse journal are used to register item movements in a warehouse. Every time that an item in the warehouse is moved, received, put away, picked, shipped, or adjusted, warehouse entries are registered to store the physical information about the zone, bin, and quantity.

The Bin Content table is used to handle all the different dimensions of the contents of a bin per items, such as the unit of measure, maximum quantity, and minimum quantity. The Bin Content table also contains flow fields to the warehouse entries, warehouse instructions, and the warehouse journal lines, which ensures that the availability of an item per bin and a bin for an item can be calculated fastly.

When item postings occur outside the warehouse module, the default adjustment bin per location is used to synchronize warehouse entries with inventory entries. During the physical inventory of the warehouse, any differences between the calculated and counted quantities are recorded in the adjustment bin and then posted as correcting item ledger entries.

The following illustration outlines typical NAV Warehouse Management flows.

NAV Warehouse Management

Design details warehouse management overview

Basic or Advanced Warehousing

Warehouse functionality in the Microsoft Dynamics NAV can be implemented in different complexity levels, depending on a company’s processes and order volume. The main difference is that activities are performed order-by-order in the basic warehousing when they are consolidated for multiple orders in advanced warehousing.

To differentiate between the different complexity levels, this documentation refers to 2 general denominations, Basic and the Advanced Warehousing. This simple differentiation covers several different complexity levels as defined by product granules and the location setup, each supported by different UI documents.

Basic UI Documents

  • Inventory Put-away
  • Inventory Pick
  • Inventory Movement
  • Item Journal
  • Item Reclassification Journal

Advanced UI Documents

  • Warehouse Receipt
  • Put-away Worksheet
  • Warehouse Put-away
  • Pick Worksheet
  • Warehouse Pick
  • Movement Worksheet
  • Warehouse Movement
  • Internal Whse. Pick
  • Internal Whse. Put-away
  • Bin Creation Worksheet
  • Bin Content Creation Worksheet
  • Whse. Item Journal
  • Whse. Item Reclass. Journal

Warehouse Setup

Warehouse functionality in the Dynamics NAV contains different levels of complexity, as defined by license permissions in the offered granules. The level of complexity in the warehouse solution is largely defined by the bin setup on location cards, which in turn is license-controlled so that access to bin setup fields is defined by the license. In addition, the application objects in the license govern which UI document to use for the helped warehouse activities.

The following warehouse-related granules exist:

  • Basic Inventory
  • Bin
  • Put Away
  • Warehouse Receipt
  • Pick
  • Warehouse Shipment
  • Warehouse Management Systems
  • Internal Picks and Put-aways
  • Automated Data Capture System
  • Bin Setup

Inbound Warehouse Flow

The inbound flow in the warehouse begins when items arrive in the warehouse of the company location, either received from external sources or from another company location. An employee registers the items, by scanning a bar code. From the receiving dock, the warehouse activities are performed at different complexity levels to bring the items into the storage area.

Each item is identified and matched to the corresponding inbound source document. The following inbound source documents exist:

  • Purchase order
  • Inbound transfer order
  • Sales return order

In addition, following internal source documents exist that function like inbound sources:

  • Production order with output posting
  • Assembly order with output posting

Basic Warehouse Configurations

The below diagram illustrates the inbound warehouse flows by document type in basic warehouse configurations. The numbers in the diagram correspond with a step in the sections following the diagram.

Design details warehouse management inbound basic flow

Design details warehouse management inbound basic flow

1: Release Source Document / Create Inventory Put-Away

When items are received in a warehouse, the user who is responsible for receiving releases the source document, such as a purchase order or an inbound transfer order, to signal to the warehouse workers that the received items can be put away in inventory. Alternatively, the user creates inventory put-away documents for individual order lines, in the push fashion, based on specified bins and quantities to handle.

2: Create an Inbound Request

When the inbound source document is released, the inbound warehouse request is created automatically. It contains references to the source document type and the number and is not visible to the user.

3: Create Inventory Put-Away

In the Inventory Put-away window, a warehouse worker retrieves, in a pull fashion, the pending source document lines based on inbound warehouse requests. Alternatively, inventory put-away lines are already created, in a push fashion, by the user who is responsible for the source document.

4: Post Inventory Put-Away

On each line for items that have been put away, partially or fully, a warehouse worker fills in the Quantity field, and then posts the inventory put-away. Source documents that are related to an inventory put-away are posted as received.

Positive item ledger entries are created, the warehouse entries are created, and the put-away request is deleted if fully handled. For example, the Quantity Received field on an inbound source document line is updated. A posted receipt document is created that reflects the purchase order, for example, and received items.

Advanced Warehouse Configurations

The below diagram illustrates the inbound warehouse flow by document type in advanced warehouse configurations. The numbers in a diagram correspond with the steps in the sections following the diagram.

Design details warehouse management inbound advanced flow

Design details warehouse management inbound advanced flow

1: Release Source Document

When items are received in a warehouse, the user who is responsible for receiving releases the source document, such as a purchase order or an inbound transfer order, to signal to warehouse workers that the received items can be put away in the inventory.

2: Create Inbound Request

When an inbound source document is released, an inbound warehouse request is created automatically. It contains references to a source document type and number and is not visible to the user.

3: Create a Warehouse Receipt

In a Warehouse Receipt window, the user who is responsible for receiving items retrieves the pending source document lines based on the inbound warehouse request. Several source document lines can be combined in a warehouse receipt document.

The user fills in the Qty. to Handle field and choose the receiving zone and bin, if required.

4: Post Warehouse Receipt

The user posts the warehouse receipt. Positive item ledger entries are created. For example, the Quantity Received field on an inbound source document line is updated.

5: Create Warehouse Internal Put-Away

The user who is responsible for putting away from internal operations creates the warehouse internal put-away for items that have to be put away in the warehouse, such as production or assembly output. The user mentions quantity, zone, and bin from where the items should be put away, potentially with the Get Bin Content function. The user releases a warehouse internal put-away, which creates an inbound warehouse request so that the task can be retrieved in warehouse put-away documents or in the put-away worksheet.

6: Create Put-away Request

When the inbound source document is posted, the warehouse put-away request is created automatically. It contains references to a source document type and number and is not visible to the user. Depending on the setup, an output from a production order also creates a put-away request to put the finished items away in inventory.

7: Generate Put-away Worksheet Lines (Optional)

The user who is responsible for coordinating put-aways retrieves warehouse put-away lines in the Put-away Worksheet based on posted warehouse receipts or internal operations with an output. The user selects the lines to be put-away and prepares the put-aways by mentioning which bins to take from, which bins to place in, and how many units to handle. The bins may be predefined by the setup of a warehouse location or operation resource.

When all put-aways are planned and assigned to the warehouse workers, the user generates the warehouse put-away documents. Fully assigned put-aways lines are deleted from a Put-away Worksheet.

8: Create Warehouse Put-away Document

The warehouse worker who performs put-aways creates the warehouse put-away document in a pull fashion, based on the posted warehouse receipt. The warehouse put-away document is created and assigned to a warehouse worker in the push fashion.

9: Register Warehouse Put-Away

On each line for items that have been put away, partially or fully, a warehouse worker fills in the Quantity field in the Warehouse Put-away window, and then registers the warehouse put-away.

Warehouse entries are created, and a warehouse put-away lines are deleted if fully handled. The warehouse put-away document remains open until the full quantity of a related posted warehouse receipt is registered. The Qty. Put Away field on a warehouse receipt order lines is updated.

10: Post Warehouse Shipment

When all items on the warehouse shipment document are registered as picked to the specified shipment bins, the shipping worker who is responsible for posts the warehouse shipment. Negative item ledger entries are created. For example, Quantity Shipped field on the outbound source document line is updated.

Internal Warehouse Flows

The flow of items between bins at the company location centers on picking components and putting away end items for assembly or production orders and ad-hoc movements, such as bin replenishments, without relation to source documents. The scope and the nature of the involved activities vary between basic and advanced warehousing.

Internal Flows in Basic Warehousing

In basic warehouse configuration, a flow of items between bins inside the company centers on picking component and putting away end items for production or assembly orders and ad-hoc movements, such as bin replenishments, without relation to the source documents.

The below steps describe the involved actions by different users and the related response:

  1. The shop floor supervisor releases the production order. Items with Forwarding flushing method and no routing link code are deducted from the open shop floor bin.
  2. The shop floor supervisor selects the Create Warehouse Pick button on the production order. A warehouse pick document has created a pick for items with ManualPick + Backward, and Pick + Forward flushing methods. These items are placed in the To-Production bin.
  3. The warehouse manager assigns the picks to the warehouse worker.
  4. The warehouse worker picks the items from appropriate bins and places them in the To-Production bin or in a bin specified on the warehouse pick, which may be a work center or machine center bin.
  5. The warehouse worker registers the pick. The quantity is subtracted from the pick bins and included to the consumption bin. The Qty. Picked field on the component list for all the picked items is updated.
  6. The machine operator informs the production manager that end items are finished.
  7. The shop floor supervisor uses a consumption journal or production journal to post the consumption of component items that use either Manual flushing method or Forward or Pick + Forward flushing methods together with routing link codes.
  8. The production manager posts the output of a production order and changes status to Finished. The quantity of component items that use Backward flushing method is deducted from an open shop floor bin, and the quantity of component items that use Pick + Backward flushing method is deducted from the To-Production bin. The below illustration shows when the Bin Code field on the component list is filled according to your location or machine/work center setup.
binflow

binflow

Availability in the Warehouse

The system must keep constant control of item availability in the warehouse, so that outbound orders can flow efficiently and provide optimal deliveries.

Availability varies depending on allocations at the bin level when the warehouse activities such as picks and movements occur and when the inventory reservation system imposes restrictions to comply with. A rather complex algorithm verifies that all conditions are met before allocating quantities to picks for the outbound flows.

Bin Content and Reservations

In any installation of NAV Warehouse Management, item quantities exist both as warehouse entries, in a Warehouse application area, and as item ledger entries, in the Inventory application area. These 2 entry types contain different data about where items exist and whether they are available. Warehouse entries define the item’s availability by bin and bin type, which is called bin content. Item ledger entries define the item’s availability by its reservation to outbound documents.

Special functionality in the picking algorithm exists to calculate the quantity that is available to pick when bin content is coupled with the reservations.

Quantity Available to Pick

If, for example, picking algorithm does not consider item quantities that are reserved for a pending sales order shipment, then those items might be picked for another sales order that is shipped earlier, which prevents from the first sales from being fulfilled. To avoid this situation, picking algorithm subtracts quantities that are reserved for other outbound documents, quantities on existing pick documents, and quantities that are picked but not yet shipped or consumed.

The result is displayed in the Available Qty. to Pick a field in the Pick Worksheet window, where the field is calculated dynamically. The value is also calculated when users create warehouse picks directly for the outbound documents. Such outbound documents could be sales orders, production consumption, or outbound transfers, where the result is reflected in a related quantity fields, such as Qty. to Handle.

Calculating the Quantity Available to Pick

The quantity available to pick is calculated as given below:

quantity available to pick = quantity in the pick bins – quantity on picks and movements – (reserved quantity in pick bins + reserved quantity on picks and movements)

The below diagram shows the different elements of the calculation.

design details warehouse management availability

design details warehouse management availability

Quantity Available to Reserve

Because the concepts of bin content and reservation co-exist, the number of items that are available to reserve must be aligned with allocations to outbound warehouse documents.

It should be possible to reserve all the items in inventory, except those that have started outbound processing. Accordingly, the quantity that is available to reserve is defined as a quantity on all documents and all bin types, except the following outbound quantities:

  • Quantity on unregistered pick documents
  • Quantity in shipment bins
  • Quantity in to-production bins
  • Quantity in open shop floor bins
  • Quantity in to-assembly bins
  • Quantity in adjustment binsThe result is displayed in the Total Available Quantity field in the Reservation window.On a reservation line, a quantity that cannot be reserved, because it is allocated in the warehouse, is displayed in the Qty. Allocated in Warehouse field in the Reservation window.

Calculating the Quantity Available to Reserve

The quantity available to reserve is calculated as given below:

quantity available to reserve = total quantity in the inventory – quantity on picks and movements for source documents – reserved quantity – quantity in outbound bins

The below diagram shows the different elements of the calculation.

Quantity Availability

Quantity Availability

Integration with Inventory

The NAV Warehouse Management application area and the Inventory application area interact with one another in physical inventory and an inventory or warehouse adjustment.

Physical Inventory

The Whse. Phys. Inventory Journal window is used with the Phys. Inventory Journal window for all advanced warehouse locations. The inventory on bin level is calculated, and the printed list is provided for the warehouse employee.

The warehouse employee enters the counted quantity in a Whse. Phys. Inventory Journal window and then posts the journal.

If the counted quantity is greater than the quantity on a journal line, a movement is posted for this difference from the default adjustment bin to the counted bin. This increases the quantity in a counted bin and decreases the quantity in the default adjustment bin.

If the quantity counted is less than the quantity on a journal line, a movement for this difference is posted from the counted bin to the default adjustment bin. This decreases the quantity in a counted bin and increases the quantity in the default adjustment bin.

In advanced warehouse configurations, a value in the Quantity (Calculated) field is retrieved from item ledger entries and the value in the Quantity (Phys. Inventory) field is retrieved from the warehouse entries, excluding the adjustment bin content. The Quantity field mentions the difference between the first two fields, which should be equal to the contents of the adjustment bin.

When you post the physical inventory journal,  inventory and the default adjustment bin are updated.

Warehouse Adjustments to the Item Ledger

in NAV Warehouse Management you can use the Item Journal window and the Calculate Whse. Adjustment function to adjust inventory on the item ledger in accordance with an adjustment that has been made to the item quantity in the warehouse bin. To create a link between the inventory and warehouse, you must define a default adjustment bin per location.

The default adjustment bin registers items in the NAV Warehouse Management when you post an increase for the inventory. However, if you post the decrease, the quantity on the default bin is also decreased. In both cases, item ledger entries and the warehouse entries are created.

If you want to adjust the bin content, you can use a warehouse item journal, from which you can enter the item number, zone code, bin code, and quantity that you want to adjust.

If you enter a positive quantity and post the line, then inventory stored in the bin increases, and the quantity of the default adjustment bin decreases correspondingly.

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