Transfer Order - Location Selection

Locations are assigned to Items when they are received into the Inventory. If the Location dimension is mandatory, then the location must be specified for all the inventory transactions for the Item.

One of the frequent queries is how the Location dimension is automatically picked by the system - i.e. what is the order of selection and the preference for locations in a warehouse.

To answer this query, consider the following scenario:

Items                      Location                    Quantity
Caps                       A01                                     5
Caps                       A05                                   15
Boots                     B03                                     8
Boots                     B08                                   25

Here, we have 2 items distributed over four Locations. For the purpose of illustration, let us assume that both the items are in the same warehouse. (Please note that the example holds good even if each item is in a different warehouse)

Consider a Transfer Order with the following quantity:

Item               Quantity
Caps                      3
Boots                    2

The system considers the first Location in alphabetical order. In this case, both the locations have sufficient on-hand quantity, so the Items are picked in total from the first available location.

The status of the On-hand quantity for the items after the TO is completed is as follows:

Items                      Location                    Quantity
Caps                       A01                                     2
Caps                       A05                                   15
Boots                     B03                                     6
Boots                     B08                                   25

Note the decrease in quantity at locations A01 and B03.

Now, consider a Transfer Order with the following quantity:

Item               Quantity
Caps                     15
Boots                   10

In this case, the on-hand at the first location is insufficient, but there is sufficient quantity in the second locations (A05 and B08)

The picking happen as follows:

Items                      Location                    Quantity
Caps                       A01                                     2
Caps                       A05                                   13
Boots                     B03                                     6
Boots                     B08                                     4

The quantity is split and picked from two different locations. The system picks the available quantity from the first location, then the remaining quantity from the second location (in ascending order). The system continues to move to the next location until the complete requirement is satisfied.

The On-hand status after the TO is completed is as follows:

Items                      Location                    Quantity
Caps                       A05                                    2
Boots                     B08                                   21

In conclusion: 

The system considers the first location, in ascending order, to pick an item.

If sufficient quantity is available in the first location, the entire quantity is picked from the same Location. If not, the quantity is split and the system picks the available quantity from the first location and then moves on to the next location to pick the remaining quantity. The process continues till the required quantity is picked.

The above illustration pertains to automatic selection of locations while processing a transfer order. However, users have the option of manually selecting the Locations for the items. In such case, the system picks the quantity from the location specified by the user and will prompt in case there is no sufficient on-hand available at the location for the item.

:)