Decoding Inventory Options: Understanding Available, Reserved, and On Hand Quantities

There are 3 kinds of inventory metrics in 4Seller. They are On Hand, Reserved, and available. Understanding the difference between Available, Reserved, and On Hand is crucial in inventory management. Here is a detailed explanation of each term:

 


 
On Hand Quantity

On-hand refers to the total quantity of a product physically present in inventory at a given time. This is the actual count of items in your warehouse or storage facility. For example, if you have 100 units of a product in your warehouse, your On Hand quantity is 100.

 


 
Reserved Quantity

Reserved quantity represents a portion of the amount of inventory that has been reserved for a specific order or purpose and cannot be used for a new order. These items are still physically present in inventory but are designated for existing commitments, such as customer orders, production needs, or other reservations.

For example, if you have 100 units on hand and 20 of them are reserved for customer orders, the number of reserved units is 20.

 


 
Available Quantity

The available quantity of a product refers to the amount that is not already reserved and is therefore ready for new orders. This is determined by subtracting the reserved quantity from the on-hand quantity. For instance, if there are 100 units on hand and 20 units are reserved, the available quantity would be:

Available=On Hand−Reserved

Available=100−20=80



Example Scenario

To illustrate the differences more clearly, let us consider a practical scenario:

On Hand: You have 200 units of Product X in your warehouse.

Reserved: Out of these 200 units, 50 units are reserved for a specific customer order.

Available: Therefore, the quantity of Product X that you can offer to new customers or use for other purposes is:

Available=200−50=150



Summary

On Hand: Total physical inventory count.

Reserved: A portion of the On Hand quantity set aside for specific commitments.

Available: The stock is ready for new orders; The maximum quantity that customers can buy



Understanding these distinctions helps in effectively managing inventory levels, fulfilling orders accurately, and improving your online business processes. 

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