Design Inventory Management System
Design an Inventory Management System that tracks products, stock levels, and inventory movements, while supporting operations like add, update, remove, and restock across multiple locations.
An Inventory Management System (IMS) is a software solution that helps businesses efficiently track, organize, and control their inventory across the supply chain, from procurement to storage to sales and fulfillment.
A well-designed IMS allows companies to:
- Monitor current stock levels in real time
- Reduce overstocking and understocking
- Track the flow of goods between warehouses or stores
- Support procurement, sales, fulfillment, and auditing processes
In this chapter, we will explore the low-level design of an inventory management system in detail.
Lets start by clarifying the requirements:
1. Clarifying Requirements
We are tasked with designing a system to manage inventory across multiple warehouses. The system should track products, stock levels, and handle orders.
Let's begin by clearly defining the system's capabilities.
Candidate: Should the system support multiple types of inventory operations such as adding, removing, and updating stock?
Interviewer: Yes, it should support all standard inventory operations like adding new items, updating existing quantities, and removing stock.
Candidate: Do we need to track inventory at a single location or across multiple warehouses?
Interviewer: Let’s support multiple warehouses. Each warehouse should maintain its own stock levels independently.
Candidate: Should the system track individual items (like using serial numbers), or manage inventory at the product level (by quantity)?
Interviewer: To keep it simple, assume quantity-based tracking per product per warehouse. No need for serial-number level tracking for now.
Candidate: Should the system support setting threshold alerts for low stock levels?
Interviewer: Yes, users should be able to set minimum quantity thresholds, and the system should alert when stock falls below that level.
Candidate: Do we need to support transaction history for auditing purposes?
Interviewer: Yes, every inventory operation should be recorded with a timestamp and operation type for audit and reporting.
Candidate: Should the system support bulk operations, such as importing inventory in batches?
Interviewer: That’s a nice-to-have. For this version, assume individual item operations are sufficient.
Candidate: Do we need to handle concurrency in case multiple updates happen on the same product simultaneously?
Interviewer: Yes, inventory updates must be thread-safe to prevent race conditions or inconsistent stock counts.
With these clarifications, we can now summarize the key system requirements.
1.1 Functional Requirements
- Support basic inventory operations: add new items, update quantities, and remove stock.
- Maintain stock levels per product, per warehouse.
- Allow multiple warehouses, each with its own inventory tracking.
- Enable setting and checking minimum stock thresholds for alerts.
- Record a history of all inventory transactions, including timestamps and operation types.
- Support viewing current stock levels by product and by warehouse.
1.2 Non-Functional Requirements
- Modularity: The system should follow object-oriented principles with well-separated components.
- Consistency: Inventory updates should be accurate and reflect immediately across relevant views and reports.
- Thread-Safety: The system must handle concurrent updates safely, especially when modifying stock quantities.
- Extensibility: The design should support future enhancements like batch imports, barcoding, or serial number tracking.
- Auditability: All operations should be logged for traceability and future analysis.
- Maintainability: The code should be clean, testable, and easy to enhance.
With the requirements clarified, the next step is to identify the core entities and responsibilities in the system.