You will need set up the Dynamics GP inventory module before you can even access the module’s functionality. Specifically you will need to identify the one segment of your account number format that relates to inventory locations. This identification allows the system to select an inventory general ledger account to use when moving inventory in the system. Though you don’t have to use this functionality, you do need to make a selection on the Inventory Control Setup screen.
You should also set up Item Classes. Make sure to mark that you want to Maintain History on the 4 options listed:
This video shows the minimum inventory setup for a new GP company: http://youtu.be/FXzS6bxdidY