Inventory Reservation and Allocation

This section describes the inventory reservation and allocation logic used by the order processing system

The StreamV Order Processing applications automatically reserve and allocate inventory to the sales order and loaner order lines that are entered into the system (quote order lines do not reserve inventory and are never allocated to).

How inventory is reserved and allocated to each sales or loaner order line depends on several factors which include

      The type of item being ordered.  Stocking and Nonstock items are treated differently by the inventory control and order processing systems.

      The order fulfillment method being used for the order line.  Some order fulfillment methods (such as vendor shipments), do not cause the system to reserve or allocate warehouse quantities. 

      Information in the Catalog and Inventory records for the item being ordered such as the lead time for the item, the reserved and allocated totals for the item, the max auto allocate quantity for the item, and other information

      Additional  information that is stored in the sales order line, such as the schedule date.

Most of the following discussion centers on the warehouse shipment fulfillment method since that is the method that is used to fulfill customer orders from your available warehouse quantities.  Most of the following discussion also centers on stocking items (items tracked by the system).

Item Types

As a general rule, the system treats nonstock items as always available.  The quantity of a nonstock item is not updated by the system and is zero, but order lines for nonstock items are fully allocated when they are saved.  The system tracks the total quantity that is reserved and allocated for each nonstock item   

Order lines for stocking items are allocated to by the system based on available stock for the item in the location in which it is ordered.

Fulfillment Method

The fulfillment method used for each order line determines how the item will be supplied to the customer.  The fulfillment method is also used to determine the Inventory Reservation and Allocation behavior to be used when the line item is saved.

      Warehouse Shipments are completed using your inventory on hand quantities.  Order lines entered as warehouse shipments will reserve inventory in the warehouse location in which the order is entered, and the lines will be allocated to from the available stock for the item in the same warehouse location. 

      Vendor Shipment order lines are shipped directly to your customer by the vendor.  Vendor shipment lines are saved as fully allocated when they are entered but they do not reserve inventory in your warehouse locations. No warehouse quantities are allocated to vendor shipment lines (they are not being shipped from your warehouse).  Vendor Shipment order lines are not included in the reserved and allocated quantities that are maintained for each item.

      Special Order Lines are lines that have specific purchase order lines tied to them.  Special Order processing is normally used for items that you do not normally stock, and that you do not wish to order unless there is a specific sales order in hand for the item.  Special Order Lines are saved as Open but not allocated, and they are not included in the  reserved and allocated quantities that are maintained for each item until the po line for the special order line is received.  At that point, the quantity supplied specifically for the order line is allocated to the order line and it is  included in the reserved and allocated quantity for the item.


Inventory Reservation and Allocation - Terms and Concepts

Inventory Reservation

Inventory Allocation

Inventory Allocation Methods

Inventory Allocation Overview