Closest Fulfillment Locations
In this example, a retailer wants to assign the fulfillment location that is closest to the customer address. Assigning the closest location can help to reduce shipping charges if a carrier’s shipping rates are based on distance, ship goods faster to customers, as well as help to reduce the environmental impact of shipments.
The retailer also wants to configure automatic location assignment to assign the closest warehouse location and, if a warehouse location cannot be assigned, to assign the closest store location. The following diagram shows the geographical position of the retailer’s fulfillment locations, the customer’s location, and the regions as set up in the region records in the system.
Locations and Inventory
The automatic location assignment setting of all fulfillment locations allows the locations to be assigned to sales orders with shipping addresses anywhere in the world. The fulfillment locations in this example also have the following individual attributes and inventory levels:
|
Location |
Type |
Blue Jeans, Size 40 |
Black Shirt, Size L |
|---|---|---|---|
|
San Francisco |
Warehouse |
30 |
20 |
|
San Francisco |
Store |
4 |
0 |
|
St. Louis |
Warehouse |
15 |
25 |
|
San Diego |
Store |
0 |
3 |
|
Denver |
Warehouse |
3 |
0 |
Fulfillment locations do not need to be ranked because the rules will assign locations to the sales order lines by distance. If locations are ranked, the automatic location assignment engine will ignore the ranking.
For more information about creating locations, see Configuring Locations for Automatic Location Assignment.
Rules
To implement a fulfillment strategy to ship from the closest location to the customer, you can create one rule. The rule tells the automatic location assignment engine to select warehouse or store locations. The locations can be within any distance of the shipping address. The rule also tells the engine to minimize fulfillment locations with a limit of one location – this means that all items in the sales order must be available at a single location. Finally, of all the locations that meet the previous criteria, the rule tells the engine to select the location closest to the shipping address.
|
Rule No. |
Line Items |
Location Types |
Minimize Fulfillment Locations |
Optimal Fulfillment Strategy |
|---|---|---|---|---|
|
Rule 1 |
All Line Items |
Warehouse |
Yes |
Closest Location |
|
Rule 2 |
All Line Items |
Store |
Yes |
Closest Location |
For more information about creating automatic location assignment rules, see Automatic Location Assignment Rules.
Locations Assigned to Sales Orders after Automatic Location Assignment
Sales orders are created for two customers, both of which have addresses in Albuquerque, New Mexico. The sales orders have different items and quantities. The following table shows the items in each sales order, the fulfillment location assigned by the automatic location assignment engine after the sales order is approved, and an explanation of why the locations are assigned.
|
Sales Order No. |
Items |
Location Assigned |
Reason |
|---|---|---|---|
|
123 |
– 1 x Blue Jeans, Size 40 |
Denver Warehouse |
The San Francisco, St. Louis, and Denver warehouses all have the item in stock. Denver is the closest location to Albuquerque (540 km away), however, so the automatic location assignment engine assigns it to the line. Note: The San Francisco store is not assigned because the first rule is a warehouse rule which assigns the San Francisco warehouse. Since the conditions of the first rule are met and a fulfillment location is assigned to the item, the automatic location assignment engine ignores the second rule. |
|
124 |
– 1 x Blue Jeans, Size 40 – 1 x Black Shirt, Size L |
San Francisco Warehouse |
The San Francisco and St. Louis warehouses have both items in stock. All other warehouses or stores only have one of the items in stock. Because the San Francisco warehouse (1450 km away) is closer than the St. Louis warehouse (1505 km away), San Francisco is assigned as the fulfillment location. |