Warehouse configuration overview
This article explains how to configure a warehouse. It includes information about how to enable a warehouse layout and warehouse processes.
Note: This article applies to features in the Warehouse management module (advanced warehousing). It doesn't apply to warehouse features in the Inventory management module.
The Warehouse management system in Microsoft Dynamics 365 for Finance and Operations gives you flexible ways to define your warehouse layout to meet changing needs, so that you can achieve optimal warehouse efficiency.
- You can establish high-priority and low-priority storages areas for optimum placement of goods.
- You can divide your warehouse into zones to accommodate various storage needs, such as temperature requirements, or various turnover rates for items.
- You can specify warehouse locations on any level (for example, site, warehouse, aisle, rack, shelf, and bin position).
- You can group locations by using physical capacity constraint settings.
- You can control how items are stored and picked, based on query-defined rules.
To use warehouse management in Finance and Operations, you must create a warehouse and enable it for more advanced or specialized warehouse management activities. On the Warehouses page, select the Use warehouse management processes option.
Zone groups, zones, location types, and locations
As part of the process for enabling a warehouse layout, you must define warehouse zone groups, and zones, location profiles, location types, and locations.
- Zone groups – A logical or physical grouping of zones within a warehouse.
- Zones – A logical or physical grouping of locations within a warehouse.
- Location profiles – A logical or physical grouping of locations that have the same warehouse location process policies (for example, a mix of different item numbers can be stored there, and the same physical capacity constraints apply).
- Locations types – A logical or physical grouping of the warehouse locations. For example, you can create a location type for all staging locations. Mandatory settings on the Warehouse management parameters page drive the process of defining staging location types and the final shipping location type.
- Locations – The lowest level of location information. Locations are used to track where the on-hand inventory is stored and picked in a warehouse.
The entities that you create to define your warehouse layout are used in the queries that you set up in work templates to drive work orders in the warehouse. Therefore, when you define the zones, location types, and so on, consider how different areas in the warehouse are used for different processes. Additionally, consider factors such as the physical characteristics of a particular area. For example, there might be areas where you can use only a certain type of forklift truck. Or, if your company has both production and finished goods within the same facility, you might want to create a single warehouse in Finance and Operations but then separate the two operations by creating two zone groups. Give your entities descriptive names, so that it's easy to identify them when you use them in template queries.
Location stocking limits, location profiles, and fixed picking locations
You must consider the physical layout of the warehouse, both to determine storage capacities (location stocking limits and location profiles) and as part of your attempts to achieve optimal warehouse processes.
Location stocking limits help guarantee that work isn't created to request that inventory be put in a location that doesn't have the physical capacity to carry the inventory. For example, if some locations within a warehouse can hold only one pallet per location, location stocking limits can be enabled. The Quantity value can be set to 1, and the Unit value can be set to PL within a specific location profile grouping.
If more advanced calculations are required to control the location capacity constraints, the location profile settings can be used. In this case, the weight and volume are considered when capacity calculations are done.
To achieve optimal outbound processes, you should evaluate whether to use fixed picking locations and/or packing locations. Often, minimum/maximum replenishment is used for replenishment processes from a bulk area to the fixed picking locations, and multiple fixed picking locations can be enabled within the same warehouse and for product variants. Consider the flexibility that can you achieve by enabling dedicated demand replenishment overflow locations that are used only for wave/load replenishment processing.
Location setup wizard
To quickly create the locations within a warehouse, you can use the Location setup wizard. As part of this process, you can easily maintain the format of the location names.
As part of the configuration of the warehouse, it's important that you enable warehouse processes according to business requirements. The most important components that you must configure are wave templates, work templates, work pools, and location directives.
Wave templates help enable the outbound "Release to warehouse" process. As soon as order lines are released (either directly from source documents, via batch job processes, or via loads that have already been created), the wave template functionality is used.
You can create three types of wave templates:
- Production order
Parameters are used to define how far the system should automatically go in the outbound work processing. A wave template is selected based on the wave template sequence and criteria that are specified in the template. If a template is listed at the top of the sequence, the criteria in that template are checked first. If the criteria can be met, the wave template is processed. Otherwise, the criteria in the next template are checked, and so on. Therefore, it's a good idea to put the template that has the most specific criteria at the top of the wave template sequence list, so that it's processed first. For example, you want to process all the work for a specific carrier today and temporarily delay processing of the work for other carriers. In this case, the wave template that selects work for that carrier should be listed higher in the sequence than other templates. Otherwise, the work for other carriers might be processed before the work for that carrier is completed.
You must specify the wave process methods in each wave template. The methods that are available vary, depending on the wave template type.
Work template definitions play an important role in the definition of warehouse management work processes. They define what work is performed, and how the work is done. Templates can also contain a directive code that links to a location directive to determine where work is performed. Work templates include a query that specifies the criteria for the work. Each template must include at least one Pick operation and one Put operation to drive the basic work operation of transferring on-hand inventory from one location to another.
If multiple workers must be able to process work for some of your warehouse operations, you might want to use the concept of staging for the inventory and separate the work execution into different work classes.
Work pools are used to organize work into groups. For example, you can create a work pool to classify work that occurs in a particular warehouse location. For all work types except counting, you can assign a work pool to a work template. For cycle counting, you can assign a work pool on the following pages:
- Cycle count plans
- Cycle count thresholds
- Cycle count work by location
- Cycle count work by item
When you use work templates to create work, the work pool is automatically assigned to the work.
Work pool IDs can also be used to limit the type of work that is directed to a particular warehouse worker, provided that this functionality is configured on the relevant mobile device menu item.
As the name suggests, location directives are used to direct the work transactions to the appropriate locations in the warehouse. In other words, they define where to pick and put.
To make it easier and quicker to define the actions that are associated with each location directive line, use one of the predefined strategies. For example, you can use the Empty location with no incoming work strategy to search for free locations in a warehouse, or you can use FEFO batch reservation strategy for outbound sales picking.