In Odoo, a Warehouse is the actual building/place in which your items are stocked. You can setup multiple warehouses and create moves between warehouses.

A Location, is a specific space within your warehouse. It can be considered as a sublocation of your warehouse, as a shelf, a floor, an aisle, etc. Therefore, a location is part of one warehouse only and it is not possible to link one location to multiple warehouses. You can configure as many locations as you need under one warehouse.

Locations are understood by the Barcode App and you can print barcodes for them, or enter the barcode for them if you already have barcodes on your Racks - see https://www.odoo.com/documentation/15.0/applications/inventory_and_mrp/inventory/barcode/setup/software.html#set-locations-barcodes

You can activate this feature from the Inventory App, Configuration --> Settings Menu:

Multi-step Routes support things like cross docking - see https://www.odoo.com/documentation/15.0/applications/inventory_and_mrp/inventory/routes/concepts/cross_dock.html

Storage Categories are useful if you have rules about where products are allowed to be stored, when they can be mixed, or need to know if a location is full BEFORE you try to put something there, and have an ALTERNATE location suggested instead. This is supported when your products can be created in advance (because you regularly receive them to REPLENISH quantities, perhaps because you are a third party fulfillment warehouse) - see https://www.cybrosys.com/blog/storage-categories-in-odoo-15

Packages are containers of products, like palettes or crates or totes, which also may (or may not) have separate barcodes. In addition to storing the location, you can store the package within the location. See https://www.odoo.com/documentation/15.0/applications/inventory_and_mrp/inventory/management/products/usage.html

A Consignment feature supports you assigning an Owner to each Receipt Transfer you receive - see https://www.odoo.com/documentation/15.0/applications/inventory_and_mrp/inventory/management/misc/owned_stock.html

Serial Numbers and Lots can optionally be recorded for high value products or those needing track and trace - see https://www.odoo.com/documentation/15.0/applications/sales/point_of_sale/shop/serial_numbers.html

Landed Costs can be added to the cost of the product if you charge per product fees or storage charges, etc. - see https://www.odoo.com/documentation/15.0/applications/inventory_and_mrp/inventory/management/reporting/integrating_landed_costs.html

We integrate with 3rd Party Shippers (UPS, FedEx, OnTrac, Deutsche Post, etc) to get labels and provide tracking information for shipments - see https://www.odoo.com/documentation/15.0/applications/inventory_and_mrp/inventory/shipping/setup/third_party_shipper.html

We support location based or task based inspections, with an audit trail of the inspection steps performed (and by whom) - see https://www.odoo.com/documentation/15.0/applications/inventory_and_mrp/inventory/management/delivery/inventory_flow.html and https://www.odoo.com/documentation/15.0/applications/inventory_and_mrp/manufacturing/management/quality_control.html

We have multi-company support (if you manage multiple LLC's or legal entities) - see https://www.odoo.com/documentation/15.0/developer/howtos/company.html

We have multi-currency support (if you work in multiple countries) see https://www.odoo.com/documentation/15.0/applications/finance/accounting/getting_started/main_concept.html

We have an Email Server (or can integrate with your email system), with all emails available from beneath the corresponding Receipt, Transfer, Return, Delivery, etc.  See https://www.odoo.com/documentation/15.0/applications/general/email_communication/email_domain.html

We have an integrated Order Management (Purchase Orders and Sales Orders) system - see https://www.odoo.com/documentation/15.0/applications/inventory_and_mrp/purchase.html and https://www.odoo.com/documentation/15.0/applications/sales/sales.html

Our Customer Portal gives your Customers a view into the status of their shipments. See https://www.odoo.com/documentation/15.0/applications/sales/sales/advanced/portal.html

Our Invoicing App manages your billing - see https://www.odoo.com/documentation/15.0/applications/finance/accounting.html

As a dropshipper since 2 years my suggested 7 major points for your instant solution are:

1. Activate Advanced Inventory Features

• Go to Inventory, Configuration, Settings
• Under Warehouse, turn on Multi-Step Routes and Storage Locations.
• Save.

2. Set up Your Rack Locations

• Go to Inventory, Configuration, Locations.
• You’ll see a top-level “WH/Stock” location. Under that, click New to create each pallet rack (e.g., “Rack A1”, “Rack B3”).
• Give each a short code (like A1) and make its Parent Location your main stock location.

3. Create Your Products

• Go to Inventory, Products, and click New.
• Give it a Name and set Product Type to Stockable (so Odoo will track quantities).
• Skip the Sales Price field entirely if you’re not selling these items—Odoo won’t complain if you leave it blank.
• Under the Inventory tab, you can add a default Purchase Price so cost reporting still works.

4. Enable Barcodes

• Go to Inventory, Configuration, Settings.
• Under Operations, enable Barcode Scanning.
• Save, then go back to your Products and Locations and click into each one to assign a unique barcode (you can type or scan them).

5. Define Putaway Rules (optional but handy)

• In Inventory, Configuration, Putaway Rules, create a rule so that when goods arrive, Odoo will suggest putting them into the right rack location automatically.

6. Receive Stock

• Go to Inventory, Operations, Receipts, click New, select your Vendor, add your stockable products and quantities.
• Validate the receipt. Odoo will create an internal transfer to move items from “Receipts” to your storage racks—follow its suggestion or scan the rack barcode to confirm.

7. Pick Stock Out

• When you need to pull something out, go to Inventory, Operations, Transfers (or Delivery Orders, if you’ve set one up).
• Open the pick list, hit Print or use the Barcode app on your tablet/phone:
  • Scan the rack location barcode (tells Odoo “I’m at Rack A1”)
  • Scan the product barcode (tells Odoo “I’m removing Product X”)
  • Enter the quantity, then validate.
• Odoo will deduct the exact qty from that rack.

If you’d like a turnkey, click-and-scan experience with less setup, Phase V offers a ready-made Odoo add-on that:

Automatically maps pallets to rack codes

Builds clean, printable pick lists

Gives you a mobile barcode interface (no extra config!)

Adds dashboard reports showing exactly who picked what, when, and from where

Hi JNZ, yes, we have found a solution, In our case, we took the standard Inventory and Barcode module and modified it heavily to suit our needs. each rack location had to be inputted as both a source and destination location and we had to manually link the barcodes on our physical racks to the virtual locations.

It's been a little long and tedious process but we now have the system working well enough to suit our needs, although it does require a little more work to make it perfect.

Feel free to reach out again if you need more info, maybe we can exchange information for mutual benifit.