The only time that a warehouse manager will manually allocate inventory is when he or she is ridding the warehouse of an item that is no longer stocked. To prevent customers from ordering the item via the NCAS, the warehouse manager indicates the item’s allocation preference—manual—on the Item Warehouse Update (IWU) screen. Manual allocation permits warehouse managers to direct issue the remaining quantity of the item, while preventing customers from ordering the item online. To obtain a manually allocated item, a customer must order it offline from the warehouse. The transaction will then be recorded on the Direct Issue (DI) screen. Direct issues will be explained later in this section.

All items are allocated by the NCAS using the First In First Out (FIFO) method of allocation. This means that items that will expire or were received first are allocated to orders first. In other words, older items are distributed before newer ones. Although your warehouse may not physically use FIFO when picking items without expiration dates, the NCAS will always use FIFO when allocating items online. Thus, FIFO is the basis for calculating average costs for your inventory items.

Once inventory has been allocated, the Allocation Exception Report (RAEXP) displays any backorders. Backorders are order lines that could not be completely allocated due to lack of available stock items. The Allocation Exception Report (RAEXP) is generated automatically during production. Backordered items are reallocated automatically as stock becomes available.  The oldest orders receive the first allocation.