Allocation Failed on Release to Warehouse. Why is reservation mandatory? AX 2012 R3

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Posted on by Ankit Batra

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Reservation is being done at site, warehouse and inventory status level and there is sufficient on-hand inventory and I can see from sales order that reservation is done. Wave template creates the work automatically.

However, when release to warehouse in done on the sales order, I get an error message that "Allocation failed, work has not been created etc"

Also, why is reservation mandatory? How will backorders be handled? In a scenario where sales orders are created automatically through an EDI interface with customers, what should be the process to release to warehouse for shipment and wave creation?

Any pointers?

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Fredrik Sætre 12,644 on at

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Your Location directives are not allocating the stock required.

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Fredrik Sætre 12,644 on at

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Reservations are required to be sure that there is stock available to pick I guess... I believe there is a function to reserve at load creation. So only create loads for dates in near future to handle the reservation conundrum. :)

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Ankit Batra 1,561 on at

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AX for some reason picks up the site and warehouse from the sales order header and not from the sales lines.

In my scenario the header and line warehouse were different and pick location directive was failing and hence allocation was being reversed.

However, can anyone help why reservation is mandatory and how back order lines are to be handled?

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Ankit Batra 1,561 on at

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Correct - my sales order header and line warehouse were different and AX picks up the site and warehouse from header and not lines. Which is a bug according to me. Would you agree?

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Ivan (Vanya) Kashperuk Microsoft Employee on at

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Yes, please open a support request about the Header/Line level

As for EDI-created orders. Reservation can be set up to be executed as part of the batch job for automatic release of sales orders, which answers also your question about how to handle the release process - use the Automatic Release to Warehouse batch job from Warehouse management\Periodic.

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Ankit Batra 1,561 on at

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Hi Ivan,

The point being that there can be hundreds of sales orders which are getting created automatically. Someone will have to release them to warehouse. This is something similar to creation of shipments in R2. However, in R2, when a shipment is activated then there is an option to continue with or w/o 100% reservation. With reservation required turned off, system will reserve what it can and leave the rest of the quantity as on-order. Output pallet transport and picking routes will be created accordingly. Whatever is not picked ultimately remains as open quantity on the sales order and on shipment remains on status registered and if required can be deleted and shipment can be completed, picked quantity can be packing slip posted and then invoiced.

In the above scenario, the sales team will never be involved and all of the above is done by the warehouse/inventory team. Sales team will post the picking list (with consolidated picking on which creates output orders) and this acts as a trigger for warehouse team to prepare shipments and deliver items. Sales order quantity is not changed depending upon what is on-hand. We capture 100% customer order. Once the shipments are complete on the sales order the pending/non-serviced quantity can be seen as on-order and rest of the quantity can be seen as invoiced.

These then appear in backorder enquiry and for my last client we wrote a job to automatically cancel deliver remainder quantity for all lines on a sales order and store that quantity in a separate field for reporting.

Note: That shipments across multiple sales orders can be combined so this gives a consolidated view of all orders to process and then reserve inventory across all orders together and then make adjustments

Also, multiple shipments can be done later when stock is produced or arrives in the warehouse through a purchase order and the pending quantity can then be shipped, packing slip posted and invoiced.

In R3 - you do not allow sales order shipment to be created if all lines cannot be 100% reserved. In this scenario I have no way other than deleting the quantity items rows upfront which I cannot service. This is a big limitation. How do I:

1. Do multiple shipments: Do a partial shipment now, produce or purchase items and service the remaining quantity later?

2. Report on backorder after servicing a sales order partially?

3. keep the task of allocation of inventory and order cuts with warehouse team rather than sales team. Warehouse team will do allocation based upon pre-defined business rules and in consultation with sales team.

Please suggest.

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Ivan (Vanya) Kashperuk Microsoft Employee on at

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Thanks for a detailed explanation of your process.

As far as I can tell, the above mentioned batch job for Automatic release of sales orders handles your scenario (assuming you have CU8 or the appropriate hotfixes applied).

It will run on a given schedule and query through all sales orders that have not been fulfilled yet (meaning some quantity still remains to be delivered to the customer) (you can customize this query when setting up the batch job), and will release each one of them in turn, doing the reservation as part of it. Whatever it cannot reserve will not be released and thus will not make it into the current wave/shipment (Fulfillment rate can be considered here, if you want to avoid small shipments for a particular order/customer)

The sales department takes no part in this process.

The reporting around remaining deliveries can be done very easily - all the data is already there on the sales order.

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Ankit Batra 1,561 on at

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Hi Ivan,

Just so that I have got it right. You are suggesting to create a cusmtom batch job which will be scheduled to release to wave only the quantity which can be reserved. Quantity which cannot be reserved will be left as is and will be open/on-order quantity. Also, as part of this custom job we can choose to consider fulfillment rate to avoid small shipments for a particular customer/order.

Is this correct?

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Ivan (Vanya) Kashperuk Microsoft Employee on at

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Not custom, existing in the standard application. The functionality I described above is already part of this batch job.

You can find it under

Warehouse management \ Periodic \ Automatic release of sales orders

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CBerg 15 on at

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Hi Ivan

There seems to be a business process issue with this functionality. I refer to your statement above that:

"The sales department takes no part in this process. "

This does not reflect reality when it comes to allocating and reserving limited inventory. This warehouse personnel have no knowledge of the priority of customers or orders if they are supporting an active promotion etc. The Sales department has this knowledge.

I have seen various threads whilst searching for a solution to allocation of inventory and the bottom line it seems with respect to R3 Warehousing is there is none. There is not a single form that can show sales order demand for an item that can then be used to review an allocate ie reserve (AX does not provide any rules) inventory to allow the Release to warehouse to proceed.

At a minimum I am looking for an equivalent functionality to the "Release Sales Order Picking" form under Inventory Management/Periodic

Are there any plans to provide this or similar?

Does it exist already but buried under some selection criteria for this release of sales orders or location directives ?

Your insight here would be appreciated

Cheers

Craig

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