To set up stock locations, you must enable the Storage Locations settings from the Inventory -> Configuration -> Warehouse Management -> Settings page.
Once you have enabled the setting, go to Inventory -> Configuration -> Locations and click on the Create button. Type the name of the location in the Location Name field, and select the Parent Location from the dropdown list. The parent location can be a physical, partner, or virtual location. There is no limit on the number of sub-locations a location can have.
You should enable the Is a Scrap Location? setting if this is a location for damaged/quarantined goods. You should enable Is a Return Location? if you want this location to be suggested when returning/accepting returns from vendors/customers.
Click on Save when done.
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