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Intermediate Certificate on pass

Stock Reservations & Allocations

Ring-fence stock for confirmed orders so available-to-sell figures stay honest.

4 lessons 35 min 5-question assessment 70% to pass

What you’ll learn

  • Distinguish on-hand from available-to-sell
  • Reserve stock against confirmed orders
  • Release reservations correctly
  • Prevent overselling across channels

Course content

4 lessons · 35 min of reading
01
Lesson 1 of 4 Reading 8 min

On-hand vs available

On-hand is the physical count on your shelves. Available-to-sell is on-hand minus what is already promised to other orders. The gap between them is reserved stock.

The distinction matters because selling against on-hand instead of available is how you oversell — promising the same unit to two customers. Available is the only safe number to sell from.

If you hold 100 units on-hand but 40 are reserved for a confirmed wholesale order, only 60 are available to sell. A cashier who sees "100" and tries to sell 80 would oversell the wholesale customer by 20 units — so in AWRA the till refuses the sale and says how much is free and how much is reserved. AWRA calls the available figure free stock, and quote and order lines show it as free-to-promise.

Key takeaways

  • On-hand is the physical count on the shelf.
  • Available = on-hand minus reserved stock.
  • Selling against on-hand causes overselling.
  • Example: 100 on-hand − 40 reserved = 60 available to sell.
02
Lesson 2 of 4 Practice 9 min

Reserving against orders

When a sales order is confirmed, AWRA reserves each stock line at the order’s warehouse, as much as is free, and backorders the rest. A reservation is a promise of a quantity from that warehouse — not of specific units, bins or batches, so your usual rotation still decides which units are picked. The units stay physically on-hand but drop out of free stock.

Reserving matters because a confirmed order is a promise, and a promise needs the stock set aside the moment it is made, not when it ships. Otherwise a later walk-in sale can quietly eat the units.

A customer confirms an order for 40 units to collect Friday. Confirming the sales order reserves 40 now; on-hand stays 100 but free stock falls to 60. Between now and Friday every sale, transfer, check-out, supplier return or build at that warehouse draws only on those 60, so the Friday collection is protected instead of being raided by mid-week foot traffic. For a promise with no sales order behind it, Hold stock does the same by hand.

Key takeaways

  • Confirming a sales order reserves its stock at the order’s warehouse.
  • A reservation is a quantity per warehouse, not specific units, bins or batches.
  • Reserve at confirmation, not at shipment.
  • Example: reserving 40 now protects a Friday collection.
03
Lesson 3 of 4 Reading 9 min

Releasing reservations

In AWRA an order’s reservation ends in one of three ways. Invoice from the order and check it out, and the reservation moves onto the checkout; approving the checkout fulfils it as the stock leaves, and rejecting it hands the stock back to the order line. Cancelling the order releases whatever it still holds, automatically. Release on the Reservations page gives a promise up by hand. Stale reservations are as harmful as none.

Releasing correctly matters because a promise nobody ends keeps locking stock — free stock shrinks for a customer who will never collect, and you stock out on paper while units sit idle. Order reservations stay until the order is fulfilled, cancelled or released, so a confirmed order that has gone quiet needs a decision; manual holds can carry an until date and are released automatically once it passes (checked every hour).

If that 40-unit order is abandoned but nobody cancels it, free stock stays at 60 even though all 100 could be sold. Three such forgotten orders could phantom-lock 120 units and trigger needless reorders. Cancel the order and its reservation is released at once, with the freed stock offered first to any backorder waiting for the item; and give manual holds an until date so they cannot block sales indefinitely.

Key takeaways

  • Checkout approval fulfils a reservation; cancelling the order releases it.
  • Stale reservations are as harmful as none.
  • A manual hold with an until date releases itself; one without stays until released.
  • Example: a forgotten 40-unit order phantom-locks free stock until it is cancelled.
04
Lesson 4 of 4 Reading 9 min

Preventing overselling

Overselling happens when two ways out of the store — say the shop till and a branch transfer — both draw on the same pool without seeing each other’s promises. The fix is one free-stock figure that every exit respects, and in AWRA that check sits at the single point all stock leaves through: the till, invoice checkouts, transfers, manual check-outs, supplier returns and assembly builds.

It matters because overselling forces the worst outcome: cancelling a confirmed order and apologising. A single, reservation-aware available number across channels is what stops it.

If the till and a transfer both saw "60 available" without sharing promises, the shop could sell 50 and the warehouse send 50 to another branch, and you would have promised 100 from 60. Because every exit goes through one free-stock check that drops the instant either moves stock, the second movement sees the real remaining 10 and is refused beyond it, with the free and reserved figures in the message.

Key takeaways

  • Overselling comes from channels not sharing reservations.
  • The fix is one available figure all channels respect.
  • Overselling forces cancelling a confirmed order.
  • Example: a till sale and a transfer both taking 50 from 60 = 100 promised.

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