What is the meaning of movement types?

A movement type is a three-digit number that determines the kind of goods movement occurring in the SAP system. It is arguably the most important component of inventory management, as it is largely responsible for determining which accounts are updated in Financial Accounting during material movements. Common examples of movement types include 101 (Goods receipt for purchase order or order), 201 (Goods issue to a cost center), 103 (Goods receipt for purchase order into GR blocked stock) and 301 (Transfer posting plant to plant in one step).