Inventory Glossary

Clear definitions for inventory, warehouse, and supply chain terms — from reorder points to BOMs.

66+ terms, each with a full breakdown: the formula where one applies, a worked example, and how it shows up in day-to-day stock control. New to inventory management? Start with safety stock and reorder point below, since most other terms build on those two.

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Material requirements planning (MRP)

What to build, and when

stockflow

Material requirements planning (MRP)

GlossaryProduction

Carrying cost

What sitting stock really costs

stockflow

Carrying cost

GlossaryCosting

Stockout

When the shelf hits zero

stockflow

Stockout

GlossaryOperations

Just-in-time inventory

Stock that arrives on time

stockflow

Just-in-time inventory

GlossaryProduction

SKU vs UPC vs EAN

SKU, UPC, and EAN decoded

stockflow

SKU vs UPC vs EAN

GlossaryClassification

WIP inventory

Stock still on the shop floor

stockflow

WIP inventory

GlossaryProduction

Dead stock

Stock that stopped moving

stockflow

Dead stock

GlossaryCosting

GMROI

Profit per dollar of stock

stockflow

GMROI

GlossaryCosting

Pick list

What to pull, and from where

stockflow

Pick list

GlossaryOperations

Purchase requisition

Ask before you buy

stockflow

Purchase requisition

GlossaryOperations

Lead time

The wait you have to plan for

stockflow

Lead time

GlossaryPlanning

Economic order quantity (EOQ)

The order size that costs less

stockflow

Economic order quantity (EOQ)

GlossaryPlanning

Minimum order quantity (MOQ)

The floor the supplier sets

stockflow

Minimum order quantity (MOQ)

GlossaryCosting

Safety stock calculator

Calculate the buffer, not just define it

stockflow

Safety stock calculator

GlossaryPlanning

Landed cost

Price on the dock, not the invoice

stockflow

Landed cost

GlossaryCosting

FIFO, LIFO & FEFO

Which unit leaves first

stockflow

FIFO, LIFO & FEFO

GlossaryOperations

Unit of measure (UOM)

Each, case, or pallet

stockflow

Unit of measure (UOM)

GlossaryOperations

Backorder

Sold, but not on the shelf

stockflow

Backorder

GlossaryOperations

Inventory shrinkage

When the count comes up short

stockflow

Inventory shrinkage

GlossaryCosting

Perpetual inventory system

Counts that stay current

stockflow

Perpetual inventory system

GlossaryOperations

Cycle counting

Small counts, done continuously

stockflow

Cycle counting

GlossaryOperations

Par level

The floor you restock to

stockflow

Par level

GlossaryPlanning

Min/max inventory method

A simpler reorder rule

stockflow

Min/max inventory method

GlossaryPlanning

ABC-XYZ analysis

Value and variability together

stockflow

ABC-XYZ analysis

GlossaryClassification

Warehouse management processes

The warehouse closed loop

stockflow

Warehouse management processes

GlossaryRelated

Asset tracking software

Tools that do not go missing

stockflow

Asset tracking software

GlossaryRelated

Meldebestand (Reorder Point): Definition & Formel

Wann nachbestellt wird

stockflow

Meldebestand (Reorder Point): Definition & Formel

GlossaryRelated

Replenishment

Getting back to target

stockflow

Replenishment

GlossaryPlanning

Days sales of inventory (DSI)

Days of stock on hand

stockflow

Days sales of inventory (DSI)

GlossaryCosting

Demand forecasting

Ordering against a forecast

stockflow

Demand forecasting

GlossaryPlanning

Put-away

From the dock to the shelf

stockflow

Put-away

GlossaryOperations

Pick, pack, and ship

The three fulfillment steps

stockflow

Pick, pack, and ship

GlossaryOperations

Dropship inventory

Sold without ever holding it

stockflow

Dropship inventory

GlossaryOperations

Inventory reconciliation

Closing the count gap

stockflow

Inventory reconciliation

GlossaryOperations

Serial number vs. batch number

Per unit, or per batch

stockflow

Serial number vs. batch number

GlossaryClassification

Inventory write-off

Off the books, for good

stockflow

Inventory write-off

GlossaryCosting

Engineering BOM vs. manufacturing BOM

Design structure vs. build structure

stockflow

Engineering BOM vs. manufacturing BOM

GlossaryProduction

Manufacturing routing

How and where it gets built

stockflow

Manufacturing routing

GlossaryProduction

Phantom bill of materials

A BOM line that is never built

stockflow

Phantom bill of materials

GlossaryProduction

Available to promise (ATP)

What you can actually promise

stockflow

Available to promise (ATP)

GlossaryPlanning

Backflushing

Consumption deducted after the fact

stockflow

Backflushing

GlossaryProduction

Blanket purchase order

One order, many releases

stockflow

Blanket purchase order

GlossaryOperations

Three-way matching

Pay for what actually arrived

stockflow

Three-way matching

GlossaryOperations

Centralized vs. decentralized manufacturing

One site, or several

stockflow

Centralized vs. decentralized manufacturing

GlossaryProduction

Inventory cost

More than the purchase price

stockflow

Inventory cost

GlossaryCosting

Multichannel vs. omnichannel retail

Independent channels, or one pool

stockflow

Multichannel vs. omnichannel retail

GlossaryClassification

Periodic inventory system

Counted on a schedule, not live

stockflow

Periodic inventory system

GlossaryOperations

SC

From raw material to customer

stockflow

Supply chain

GlossaryClassification

Asset lifecycle

From acquisition to disposal

stockflow

Asset lifecycle

GlossaryOperations

Mean time between failures (MTBF)

How often does it fail

stockflow

Mean time between failures (MTBF)

GlossaryOperations

Calibration record

Proof the reading can be trusted

stockflow

Calibration record

GlossaryOperations

Asset depreciation

Cost spread across useful life

stockflow

Asset depreciation

GlossaryCosting

Min/max vs. reorder point

When to order, and how much

stockflow

Min/max vs. reorder point

GlossaryPlanning

MRP vs. ERP

A module, not a category

stockflow

MRP vs. ERP

GlossaryProduction

SKU vs. serial vs. lot number

Three levels of granularity

stockflow

SKU vs. serial vs. lot number

GlossaryClassification

Multi-client warehousing

Many owners, one warehouse

stockflow

Multi-client warehousing

GlossaryOperations

Bin location

Where exactly it lives

stockflow

Bin location

GlossaryOperations

Unique device identification (UDI)

A device ID, plus a batch ID

stockflow

Unique device identification (UDI)

GlossaryClassification

ISO 9001 traceability records

What the standard asks for

stockflow

ISO 9001 traceability records

GlossaryOperations

Standard costing

A planned cost, tracked against reality

stockflow

Standard costing

GlossaryCosting

Negative inventory

A sequencing gap, not a real shortage

stockflow

Negative inventory

GlossaryOperations

Kanban replenishment

The bin itself is the signal

stockflow

Kanban replenishment

GlossaryPlanning

Browse every term A-Z

All 66 terms in this glossary, in one list. Looking for something broader? See how these terms come together in our inventory management software guide or the warehouse management process overview.