To update the administrative warehouse

In various VMI scenarios, the party who manages the VMI warehouse or consignment warehouse defines the warehouse as a regular warehouse in his system. The other party, who owns the inventory in the warehouse or is responsible for supply planning, does not require registering every single activity involved in warehouse handling. For supply planning or invoicing purposes, this party is satisfied with a mere overview of the inventory levels and therefore defines the warehouse as an administrative warehouse in his ERP system.

If the customer manages the warehouse, the warehouse is defined as an administrative warehouse in the supplier's ERP system. If the supplier manages the warehouse, the warehouse is defined as an administrative warehouse in the customer's ERP system.

The administrative warehouse must be updated with the inventory levels of the "real" warehouse on a regular basis. The frequency and the required accuracy level of these updates depends on the applicable VMI scenario. For more information, refer to Overview of VMI business scenarios.

In the supplier's administrative warehouse, receipts are usually registered by means of transfer orders or receipt delivery messages after the receipts in the real warehouse are performed.

Consumptions are registered through consumption records triggered by consumption messages from the customer. When you process the consumption records, LN initiates invoicing, if applicable, and reduces the inventory of the administrative warehouse. To register the inventory reduction, LN creates a sales order of type Sales (Manual) and a shipment, which you can view in the Item - Warehouse - Inventory Transactions (whinr1510m000) and the Inventory Receipt Transaction Consumptions (whina1514m000) session. For more information, refer to Inventory consumption handling.

The customer's administrative warehouse is updated by automatic receipts triggered by receipt delivery messages after the receipts in the real warehouse are performed. Consumptions are registered through issues for outbound order lines based on the customer's originating production order or sales order. For more information, refer to Method of Inventory Update and Consumption records.