Magento 2: Multi Source Inventory (MSI)

April 8, 2021 Wasim Haider Chowdhury Comments

In Magento 2.3+, you can use outstanding features of Multi Source Inventory (MSI). Using MSI, you can control the single or multi-channel inventories and sale channels. Besides managing physical locations, sources, and their products, you can manage inventory visibility effectively, ease Drop Shipping and get low-level up-to-date inventory reports.

In Magento 2.3+, you can use outstanding features of Multi Source Inventory (MSI). Using MSI features, you can do the following:

Control the single or multi-channel inventories and sale channels.
Manage physical locations, sources, and their products.
Manage inventory visibility effectively and enhance customers’ experiences.

Ease of Drop Shipping.
Get low-level up-to-date inventory reports.
Ship from a different Warehouse.
Allow your customer to buy online and pick up in store options.

How to implement Multi Source Inventory (MSI) in Magento 2

To use Magento 2 MSI in better way, we should follow the steps below:

Step 1.1: How to Add a Sources

In MSI, sources represent the physical locations where you can store your products. Those locations can be either a warehouse, a drop shipper, or a distribution center.

1.1.a) In Magento Admin, navigate to Stores > Inventory > Sources

1.1.b) After clicking, you can see the default Source. By default, Magento store is single-source mode and all products are stored to the default source.

1.1.c) By clicking on the Add New Source button, add a new source and enable multi-source mode.

Step 1.2: Manage Stocks

1.2.a) Like the Sources addition, navigate to Stores > Inventory > Stocks in Magento Admin.

1.2.b) After clicking, you can see the default Stock.

1.2.c) By clicking on the Add New Stock button, add a new stock with its Name, Sales Channel and Sources.

Step 1.3: How to add Product Qty to the Sources

Now, you can add product quantity to a source.

1.2.a) Navigate to Catalog > Products.

1.2.b) In the Product grid, click on the Edit button to edit a product.

1.2.c) In Product edit page, scroll down to the Sources section:

Step 1.4: Salable Quantity in MSI

As of Magento 2.3+, when a customer places an order, the salable quantity will not be decreased, but the products Quantity will not be changed instantly. The quantity of product is decreased only after fulfilling the shipment.

Step 1.5: Shipping Algorithm

When you are ready to make a partial or full shipment, you as a merchant can select the source or sources from which to send the products. Customers typically want low-cost shipping and a guarantee of safe arrival of products, while the merchant needs to ensure minimal overhead for the inventory storage and shipping costs.

MSI includes an algorithm that takes the above considerations into account and recommends the best shipping option or options. Magento provides an algorithm for Priority, using the source priority per stock, where each source is given a priority in the scope of a specific sales channel, and for Distance, using the locations of sources and shipping destinations.

Inventory Management also supports developer-provided extensions for other algorithms based on criteria such as cheapest shipping and closest GPS location.