Tip of the Week: Automate Inventory Reservation and Release of Sales Orders to Your Warehouse in Dynamics AX

The functionality described in this blog can help you achieve automatic reservation of inventory and automatic release of orders to the warehouse in Dynamics AX 2012 R3. You can even configure AX to automatically release sales orders to the warehouse for picking based on selected criteria. Outside of the Warehouse Management (or WMS) functionality itself, which was added to AX 2012 as part of the R3 release two years ago, the ability to reserve inventory in this way and use a reservation percentage, or fulfillment rate, to automatically release orders to the warehouse is one of the most critical functions of an ERP that distributors needed but had been missing in AX prior to R3.

Note: that the functionality described below requires you to use the WMS within AX.

First, on the AR parameters form, you can enable a function that will release sales orders to the warehouse based upon a fulfillment rate. This rate can be based on Quantity or Price, which you would select in the Value type field shown below. Then in the Fulfillment rate field, you would set an acceptable rate for automatically releasing sales orders to the warehouse for picking.

Set_up

For example, let’s say I set the Value type to Price, the Fulfillment rate to 80.00 and the Fulfillment violation messages to Error. I could then run the batch job located at Warehouse management > Periodic > Automatic release of sales orders. This job will release to the warehouse any Sales order where at least 80% of the Sales value (i.e. Price) of goods on the order is reserved.

You can even override this at the customer level, for those customers who require a higher (or possibly lower) fulfillment rate on their orders.

Warehouse_management

That’s is some pretty powerful stuff in the distribution world. Now, imagine if you could configure the batch job to do the reservations for you. Well, you can!

To do this, select the “Reserve when orders are released by a batch job” field on the Warehouse form for your WMS-enabled warehouse.

Warehouse_managment_2

Later when you setup the batch job, you would want to set the “Quantity to release” field to Physically reserved. This way only the reserved quantities would be released to the warehouse for picking. You also have the option of re-releasing orders that were partially released before (i.e. backorders).

Automatic_release_sales_order

I cannot overstate how important a process this can be for any distributor, especially those with a high volume of sales orders to process. One idea you should consider is to set the Fulfillment rate to 100.00 on the AR parameters form so that all orders that are 100% reserved are automatically released to the warehouse. Imagine how much time that could potentially save for a high volume distributor.

Now, go have fun reserving inventory… or rather, letting AX do it for you!

Article written by

Consultant Matt joined I.B.I.S., Inc. with over 15 years of experience in distribution, operations and logistics. He has experience with inventory management, quality control and transportation, as well as a background in training. He is a veteran of the U.S. Army and enjoys music, movies and coaching baseball.

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