Where does scrapped stock go in Odoo?

To a virtual location of type Inventory Loss. On a new Odoo 19 database the Scrap Location defaults to Inventory adjustment, the same location that count corrections use, so it's worth creating a dedicated scrap location to keep the two apart.

Does scrapping stock create an accounting entry in Odoo 19?

Only when the product uses Perpetual (at invoicing) valuation and the scrap location has a Loss Account. Odoo then debits the Loss Account and credits the stock valuation account at the product's cost. Otherwise the fall in stock value is picked up by the stock closing entry.

Should I scrap stock or use an inventory adjustment?

Scrap when you know what happened to the goods: damaged, expired or spoilt. Use an inventory adjustment when a count differs from the system and you can't say why.

How to Record Scrap, Wastage and Damaged Stock in Odoo 19

By Sajjal Bajaj · Oct 14, 2026 · 8 min read · Odoo Odoo 19 Setup Inventory Inventory Management Stock Control Warehouse Management Food and Beverage

Short answer: in Odoo 19, go to Inventory ‣ Operations ‣ Scrap, click New, choose the product, quantity and a Scrap Reason, and click Validate. Odoo moves the goods out of stock into a virtual Inventory Loss location. You can also scrap from a receipt, delivery or manufacturing order. Give scrap its own Inventory Loss location with a Loss Account so wastage shows separately, and keep inventory adjustments for unexplained count differences.

This is the setup guide. For counting and correcting stock in general, see my explainer on inventory adjustments and cycle counts in Odoo.

Applies to

Odoo version: Odoo 19. I also checked the Odoo 20 documentation and code, which change this area. In Odoo 20 a scrap is no longer a separate scrap order record but a stock move marked as scrap. The menu stays the same, but the button reads Confirm, the checkbox is Should Replenish, you can scrap from a lot or serial number, and Moves History gains a Scrapped filter and a Revert action for scraps.
Edition: Community and Enterprise for scrapping. The Quality app, Shop Floor and the Profit and Loss report in Accounting are Enterprise only.
Apps: Inventory, plus Manufacturing for production scrap and Accounting or Invoicing for the valuation side.

Before you start

Turn on Storage Locations in Inventory ‣ Configuration ‣ Settings (Warehouse section). Without it the Source Location and Scrap Location fields are hidden, so you can’t choose where scrap comes from or goes to.
Agree your reasons. A short list works best, for example Damaged on receipt, Damaged in warehouse, Expired, Temperature breach and Customer return, unsaleable.
Check valuation with your accountant. Odoo 19 values stock either Perpetual (at invoicing) or Periodic (at closing), set for the company and overridable on each product category. That choice decides when scrap reaches the books.

Step by step

Create a scrap location. Go to Inventory ‣ Configuration ‣ Locations, remove the Internal filter and check whether a location named Scrap already exists. If not, click New, name it Scrap, set Location Type to Inventory Loss and, under Accounting Information, choose a Loss Account (an expense account your accountant picks for write-offs).
Scrap from stock. Go to Inventory ‣ Operations ‣ Scrap and click New. Fill in:
- Product and Quantity, plus Lot/Serial for tracked products.
- Source Location: where the goods physically are, such as WH/Stock/Cold Room.
- Scrap Location: your scrap location. Odoo defaults to the company’s first Inventory Loss location, which is normally Inventory adjustment, so change it each time.
- Scrap Reason: type a reason and pick Create if it’s new. There’s no separate menu for reasons.
- Replenish Quantities: tick it to have Odoo replace the scrapped quantity straight away, through the product’s usual replenishment route.
- Source Document: a note such as a delivery reference, if relevant.
Click Validate. If the source location doesn’t hold enough of the product, Odoo warns you first.
Scrap from a receipt or delivery. Open the transfer, click the Actions (cog) icon, choose Scrap, fill in the Scrap Products pop-up and click Scrap Products. If the transfer is already validated, the scrap comes out of its destination; if not, out of its source. For receipts, validate first, so the scrap leaves your stock rather than the vendor location.
Scrap in manufacturing. On a manufacturing order, use Actions (cog) ‣ Scrap. Components can be scrapped before the order is done; finished products once it’s done. Shop Floor (Enterprise) lets operators scrap components too.

Scrap or inventory adjustment?

Situation	Use
Cartons crushed, product expired, chilled goods spoilt	Scrap, with a reason
A count finds 4 fewer than the system and nobody knows why	Inventory adjustment
A count finds more than the system	Inventory adjustment
Goods arrive damaged from the vendor	Depends on the supplier; see the next section

Inventory adjustments live in Inventory ‣ Operations ‣ Physical Inventory: enter the counted quantity and click Apply. They post to the Inventory adjustment location too, which is why a separate scrap location makes the two easy to tell apart.

Damaged goods on receipt

Decide before you validate the receipt:

The supplier will credit you and won’t resend: receive only the good units and click No Backorder. The purchase order’s Received quantity is then correct, and a bill on received quantities is for what you kept. My guide to backorders in Odoo covers this.
The supplier will collect them: receive everything, then use Return on the validated receipt. By default a return lowers the purchase order’s received quantity.
They’re your loss: receive everything, then scrap the damaged units from the receipt with a reason.
You inspect goods (Enterprise): a Quality control point on receipts, with Control Per set to Quantity, can send failed units to a Failure Location such as WH/Quarantine. You then return or scrap them from there.

Worked example: a food and FMCG distributor

A distributor of packaged foods keeps chilled lines in WH/Stock/Cold Room and tracks them by lot. It uses Perpetual valuation and has created a Scrap location with a write-off expense account as its Loss Account.

Monday: 200 cartons of biscuits arrive and 6 are crushed. The supplier agrees to credit them and tells the team to dispose of them. The receiver enters 194, validates and clicks No Backorder.
Wednesday: a cold room check finds 18 tubs of yoghurt from one lot past their date. The supervisor scraps them from WH/Stock/Cold Room to Scrap, with the lot and the reason Expired. Odoo posts an entry debiting the Loss Account and crediting stock at the product’s cost.
Friday: a van brings back 3 cases of juice dented in transit. They were already delivered, so the team processes a customer return (see my guide to sales returns in Odoo), then scraps the 3 cases from stock with the reason Customer return, unsaleable.
Month end: the manager opens Scrap Orders, switches to the pivot view and groups by Product and Scrap Location to see what was written off.

To cut expiry waste, the team also picks chilled lines first-expired, first-out; see removal strategies in Odoo.

What you should see

A scrap reference on each validated scrap order, and a Product Moves smart button with the move.
A Scraps smart button on any transfer or manufacturing order you scrapped from.
On-hand stock lower in the source location, and the scrapped quantity in the scrap location’s stock.
Scrap Orders in list, pivot and graph views, with grouping by Product, Location, Scrap Location and Transfer.
With Perpetual valuation and a Loss Account, a posted journal entry per scrap. If either is missing, there’s no entry at the time; the stock closing entry picks up the change.

Troubleshooting

Scrap went to Inventory adjustment instead of Scrap. That’s Odoo’s default. Change Scrap Location on each new scrap order. Validated scraps can’t be edited or deleted, so ask your accountant to reclassify past amounts if they need separating.

No journal entry after scrapping. The product uses Periodic (at closing) valuation, through its category or the company default, or the scrap location has no Loss Account.

You can’t see Source Location or Scrap Location. Storage Locations is off.

The scrap tried to take stock from the vendor. You scrapped from a receipt that wasn’t validated yet. Validate the receipt, then scrap.

Scrapped stock was reordered without anyone asking. Replenish Quantities was ticked, which runs the product’s replenishment straight away.

Official references

Odoo 19 documentation: Scrap inventory
Odoo 19 documentation: Account for scrapped goods
Odoo 19 documentation: Scrap during manufacturing
Odoo 19 documentation: Inventory adjustments
Odoo 19 documentation: Inventory valuation (Accounting)
Odoo 19 documentation: Failure locations (Quality)

*How this guide was checked: menu paths, field names, defaults and Enterprise-only status were checked against the Odoo 19 documentation and the Odoo 19 code for scrap orders, locations, returns and stock accounting, in October

The Odoo 19 manufacturing page names the default scrap location differently from the Inventory page; I’ve followed the code. The worked example is illustrative and wasn’t run on a live database, so there are no screenshots; labels can vary slightly with your installed apps and language.*

If wastage is a real cost line for you and you want it visible and accounted for properly, I can help design the setup. See Odoo implementation.