Natural Solutions Blog

Who Gets the Last Cookie?

Natural Solutions - Monday, February 22, 2016

When you have two customers fighting over the last item left, who gets that SKU?  That's one of those philosophical discussions concerning inventory allocation, with pros and cons for the different strategies...

In the standard setup of Natural Order, it is first-come first-served, so the first order gets the goods - we call this Soft Reserve.  The first/lowest numbered order will always get the items unless you put the first order on hold, or raise the priority of a later order, or the first order has SHIP COMPLETE turned on and some other SKU on that order is backordered, or you do a special pick batch that selects the other order for some reason, or a number of other reasons.  So, you can jump someone who ordered later to the front of the line if needed, or who can ship NOW.   This maximizes what can be shipped NOW, which means payment is maximized sooner.

But what if you want the system to always allocate the items to whoever ordered them first?  If so, you can turn on Hard Reserves, also called FIFO Allocation.  This process uses the date and time of the order to determine who gets the inventory, even if backordered or on hold or has other items backordered causing the order to not pick at this time;  then whoever ordered it first always will get that inventory.  That means you can't easily subvert the inventory availability promises made on the phone :-)  But it also means that in-stock inventory might not be allocated to other orders if an earlier order is on hold, or if other lines on those earlier orders are backordered.

The Hard Reserve feature changes a number of basic assumptions built-in to Natural Order, and is enabled via a license change, so you may not see it available on your screen - contact Support to enable this functionality.