Design an inventory management system

Q: Design an inventory management system

This question evaluates competency in system design, data modeling, distributed consistency, concurrency control, API design, idempotency, and scalability for backend inventory and reservation workflows.

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Question

Design an inventory management system for an e-commerce business.

The system must support:

Updating stock when inventory is received, adjusted, or sold.
Reserving items when a shopper starts checkout (to prevent overselling).
A “shopper collects items” workflow (e.g., curbside pickup / warehouse picking): an API call that marks items as collected/picked and updates inventory accordingly.

Focus areas:

Database schema design.
Achieving high consistency (avoid overselling, correct reservation handling under concurrency).
Core APIs and their request/response semantics.
Handling race conditions, retries, and idempotency.
Reasonable scaling approach (multiple SKUs, multiple warehouses/locations).

Design an inventory management system

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Solution

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