Locations with and without bins

Many companies start with inventory management in a single location and end up with a setup that is either too simple or too heavy. Business Central has several levels, and the right one is the smallest that solves your problem. Here you see what locations and bins are, which levels exist, and what to think about before you turn on bins. You also get a short list of questions to ask before you change the setup.

Location and bin are not the same

A location is a place where you buy, store and sell items, for example a warehouse, a service van or a showroom. A bin is a position inside the location. You can change a location's setup as long as it has no item ledger entries. If it is in use, you must therefore plan changes, for example by creating a new location.

When locations are enough

Locations suit places that are geographically separate. They allow access control through warehouse employees and responsibility centers, calendars and handling times for planning, and different default dimensions and posting setups. If you have items that always sit in the same place, the Shelf No. field on the item card can be enough. Microsoft Learn stresses that it is for information only and is not used in warehouse activities.

The levels in Microsoft's overview

Microsoft describes complexity levels by which settings are turned on on the location card:

No warehouse activity: you post directly from orders and journals. Bins are optional.
Basic, consolidated: Require Receive and Require Shipment give warehouse receipt and warehouse shipment for several orders.
Basic, order by order: Require Put-away or Require Pick give inventory put-away and inventory pick per order.
Advanced: receipt and put-away as well as shipment and pick, with worksheets and warehouse documents for several source documents.
Directed put-away and pick: the most advanced level, where bins are mandatory and the activities follow a fixed flow.

Turn on bins

You turn on bins by enabling Bin Mandatory on the Warehouse FastTab on the location card. The bins must be created before you can use them as defaults in the location's fields. You can group bins into zones and give them types such as RECEIVE, SHIP, PICK and QC. The types and capacity limits are only used fully with directed put-away and pick.

If bins are mandatory, inventory movements are posted at bin level. At the advanced levels they are recorded as warehouse entries, and you must synchronize them with the item ledger entries when counting.

Questions to ask first

How many people work in the warehouse at the same time?
Do you need to know exactly where the item is, or only how much you have?
Who will maintain the bin setup?
Are there items that must be quarantined or go through receiving inspection?
Can you make do with several locations instead of bins?

Typical pitfalls

Many turn on directed put-away and pick too early. You then get more documents, more steps and more places where an employee can get stuck. Start with the level that solves your errors today, and move up only when you can point to a concrete problem.

Also consider how you move on later. Microsoft Learn has a guide to converting existing locations to locations with warehouse management and to restructuring warehouses. Read it before you change a location that has postings.

Next steps

Addverk builds its own apps for Business Central, but they are not on Microsoft AppSource yet. On the apps page you can see what we are working on. If you want help with the setup in standard BC, you will find the services and the open prices on the prices page.