Design an inventory system

Q: Design an inventory system

This question evaluates a candidate's competency in designing inventory and distributed systems, covering stock tracking models, reservation and commit semantics, concurrency control, data modeling, API design, and real-time integrations.

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Question

System Design: Inventory Management with Real-Time Stock and Ordering

Context

You are designing an inventory management service for a retail/marketplace platform with multiple merchants and locations (stores, dark stores, warehouses). Inventory must stay accurate across web/app ordering and in-store sales, with real-time updates to shoppers and partner systems. Assume high read volume (availability checks) and moderate write volume (stock changes, orders).

Task

Design an inventory management system that supports:

Stock tracking (on-hand, reserved, available) across multiple locations and merchants.
Ordering flows with reservation/commit/release semantics to prevent overselling.
Real-time updates to clients and partner integrations when availability changes.
Discussion of:
- Key components/services and their responsibilities.
- Core data model and relationships.
- External and internal APIs (including idempotency and error handling).
- Scalability strategies for reads/writes and hot SKUs.
- Consistency and concurrency control (isolation levels, conflicts, eventual vs strong consistency).

State any assumptions you make and justify trade-offs where relevant.

Design an inventory system

System Design: Inventory Management with Real-Time Stock and Ordering

Context

Task

Solution

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