Managing rental items using hierarchical storage locations without putting away returned items. One method comprises receiving units of a rental item at a processing facility. Each of two or more local storage locations is associated with a different successively longer time period of subsequent processing for that storage location. The rental item is associated with a net average shipping quantity and a buffer inventory quantity for each time period. An excess number of the units is determined as the rental item units that are not needed for current orders. A first quantity of the excess units is placed in a first local storage location. The first quantity is based on the net average shipping quantity for the first location; in a second location, a second quantity of the excess units is placed. The second quantity is based on the buffer inventory quantity for the second location and a growth factor.