How is the vendor unit ratio used?

The unit ratio specifies the ratio between inventory and vendor units of measure (UOM). For example, if you stock an item in single units, but a vendor sells you the item in cases of 12, then you would enter "12" as the vendor unit ratio (i.e., 12:1). If the ratio is 1:1, then enter "1" as the unit ratio. Having a defined vendor unit ratio allows you to purchase inventory in the vendor's UOM. However, on receipt that inventory will be converted automatically to your inventory UOM.