January 2025   ​|   ​Finance & Accounting   |   ERP

With the release of Odoo 18, the ERP system has received a significant enhancement in the area of stock valuation. While Odoo 16 already introduced the automatic “Revaluation in case of deviating invoice amount”, Odoo is now going one step further. Version 18 makes it possible to customize the valuation of serial number- or batch-managed products.

What does this mean in concrete terms for companies?
More flexibility, more control and a more accurate reflection of actual costs. However, there are also challenges that need to be considered. In this article, you will learn about the advantages of the new valuation method and what you should pay attention to.

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The previous stock valuation methods in Odoo

Standard valuation with FIFO & average price

Until now, companies could choose between two stock valuation methods in Odoo:

• FIFO (First-In-First-Out): The oldest stocks are sold first, whereby the cost price of these items is used for valuation.

• Average Costing: Inventory is valued at an average cost price, regardless of when and at what price an item was purchased.

Both methods are tried and tested - but they have weaknesses, especially for products with highly fluctuating purchase prices.

Challenges with high-value products

Companies that work with high-priced or high-value products were faced with a problem:

• A blanket FIFO valuation can be inaccurate if individual batches have very different cost prices.

• The average price can also be problematic if the costs per unit differ greatly.

This is where Odoo 18 comes in with its new evaluation option.

New evaluation options in Odoo 18

Individual evaluation by serial number or batch

The big innovation in Odoo 18: Companies can now specify for each product whether the evaluation should be aggregated or individual.

What that means:

✔ Products with serial numbers or batches can now be evaluated individually.

✔ When a particular item is sold or consumed, its individual cost price is taken into account.

✔ Value tracking becomes more precise and transparent.

Advantages for companies with dynamic purchase prices

Companies from these sectors benefit in particular:

• Electronics industry: Hardware components can have large price fluctuations.

• Medical technology: Batch-specific evaluation is essential for documentation.

• Luxury goods: Individual items have individual purchase prices that must be recorded precisely.

The new valuation method gives companies a more realistic representation of their inventory values and therefore more accurate financial accounting.

Limits and challenges of the new method

No targeted devaluation of individual serial numbers possible

One small drawback: Odoo currently does not allow direct devaluation of individual serial numbers or batches. Instead, a devaluation is distributed evenly across all serial numbers of a product.

This means:

• If an individual component is damaged and is to be devalued, the correction is applied to all items of this product.

• Companies may have to use workarounds to devalue individual serial numbers.

Conclusion - A big step for warehouse valuation in Odoo

With the new stock valuation functions in Odoo 18, companies finally have the option of using individual cost prices per serial number or batch. This provides more transparency and more realistic value tracking - especially for companies with volatile purchase prices or high-priced products.

Nevertheless, there is still room for improvement, especially in the targeted devaluation of individual serial numbers. It remains to be seen whether Odoo will release future updates with further optimizations.