Allocation Strategies

ShipHawk WMS’s allocation logic is based on the concept of “Outbound Groups” of bins, and Rule Sets defining sequences of Outbound Groups to search for candidate inventory to allocate. In the diagram below, an example is shown where Forward, Back Stock, and Reserve “Outbound Groups” of bins have been established for different channels (A, B, and C). As noted on the diagram, bins assigned to each Outbound Group do not need to be contiguous; rather, any set of bins in the warehouse can be assigned to any Outbound Group. Once all Outbound Groups are defined and physical bins assigned, Allocation Rule Sets are defined. Allocation Rules Sets define sequences of Outbound Groups and allocation strategies to use for allocation.

Specifically, when an order is processed in ShipHawk WMS, a Allocation Rule Set is assigned based on various characteristics of that order, such as channel, division, type, volume, and other attributes. In addition, line items can be specifically be assigned an override Allocation Rule Set based on item characteristics. The Allocation Rule Set will be used to control the allocation of that item on an order. ShipHawk WMS will retrieve this Allocation Rule Set and search, in sequenced order, across the bins for each Outbound Group defined for that Allocation Rule Set, seeking suitable bin inventory to assign to the order. Each Outbound Group also has a set of related secondary rules to control allocation options such as first-in-first-out (FIFO), first-expiration-first-out (FEFO), ascending/descending quantities (pick-to-clean or minimize picks), and other best practice allocation processes. ShipHawk WMS will seek to fully allocate each item on the order until all items are allocated or candidate inventory is exhausted. If ShipHawk WMS finishes the allocation process and is unable to allocate all item quantities on an order, ShipHawk WMS will perform an evaluation to assess whether the order should ship partially (as allocated), or reest the order to await new inventory so that it can ship with sufficient quantity to satisfy the order release rules. Of course, if ShipHawk WMS is receiving fully-committed Item Fulfillments from NetSuite (or other ERP), ShipHawk WMS should rarely encounter a scenario where it is unable to fully allocate an order.

Once an order is allocated and satisfies the order release rules (usually based on fill rate by units or dollar value), it is a candidate for wave optimization processing, discussed next.