Considerations for Inventory Organizations

You can create an inventory organization and should consider the dependencies and required parameters before you create the organization. After you create an inventory organization, you can change the name of an inventory organization but not the code.

Before creating inventory organizations, consider the following:

Set up inventory organization dependencies
Plan inventory organization parameters
Profit center business units
Copy inventory organizations

Setting Up Inventory Organization Dependencies

When you create an inventory organization, you must associate it to dependencies, such as business units and legal entities. For this reason, create these dependencies before creating an inventory organization.

Planning Inventory Organization Parameters

Before creating an inventory organization, plan the inventory organization's parameters.

Consider the following when planning to configure an inventory organization's parameters:

Which schedule to use.
Whether to configure locator control and if so, the level at which to enforce the locator control.

If you set the locator control to No locator control, later you can change it to Locator control determined at subinventory level. Only newly created subinventories will use locator controls. Any subinventories created before this change will continue to have no locator controls.

If you set the locator control to Locator control determined at subinventory level, you can update it to No locator control, only if every subinventory beneath the organization has no locators. If any subinventory below the organization uses locators, you won’t be able to change the locator control.
How you want to configure movement request settings such as pick slip batch size and replenishment movement request grouping.

Consider the size of your operation, your usage of subinventories, and the type of labor or equipment required when considering whether you want to use organization- or subinventory-level replenishment movement request grouping.
How you want to configure lot, serial, and packing unit generation settings.

To make appropriate choices for these settings, you should be familiar with:
- Your company's guidelines for creating lot names, serial numbers, and packing unit numbers
- Whether your company requires you to assign the same lot number to multiple items in the same organization, or a specific lot number to only one item in the same organization
- Whether your company requires you to lot control purchase order or shipping order material
How you want to configure item sourcing details, such as the picking rule to use, and whether to specify the inventory organization as a logistics services organization.

Profit Center Business Units

When defining inventory organizations, you must specify a profit center business unit to generate intercompany trade transactions for various business flows. If you don't associate a profit center business unit to an inventory organization, it may result in trade transaction errors during cost processing.

Copying Inventory Organizations

Before creating new inventory organizations, you should determine if copying an existing inventory organization is the appropriate method. The Copy Inventory Organizations task can be used to simplify creating inventory organizations when a source organization exists, and is suitable to be used as the basis for making a series of copies where the new organizations vary by name, code, and location.

For example, your business uses third-party companies for shipping and new companies are added often. The new third-party companies will use the same parameters as the existing companies, only the name and location vary. You can use a suitable existing inventory organization and create new inventory organizations that use the new company's name, code, and location.

Note: Organizations enabled for contract manufacturing or for item sourcing can't be used as the source organization when copying Inventory Organizations.