Abstract:
The present invention provides a method for allocating inventory of a supplier to contracted requestors based on allocation priorities. The supplier sets up a distribution arrangement (contract) with each requestor interested in obtaining inventory. Each inventory record identifies a pool of available inventory. Under a distribution arrangement (between the requestor and the supplier), one or more availability records are associated (by the supplier) with the distribution arrangement. An availability record identifies an inventory record from which inventory will be allocated (to a requestor). A supplier allocates inventory (to a requestor) from a pool of inventory identified by an inventory record associated with an availability record (the availability record indicates that inventory is to be allocated from the pool of inventory identified with the inventory record) assigned (by the supplier) under a distribution arrangement. Each availability record indicates an allocation priority relative to other availability records.

Description:
FIELD OF THE PRESENT INVENTION  
         [0001]    This invention relates to allocating inventory, and more specifically to allocating inventory from a pool of available inventory to requestors based on allocation priorities.  
         BACKGROUND  
         [0002]    Suppliers of inventory (organizations that supply product and/or services such as, distributors, wholesalers, or manufacturers and the like) allocate inventory by reserving portions of inventory to organizations or entities that request inventory (such as resellers, end users, renters, buyers of product and/or services, hereinafter referred to as ‘requestors’). Inventory can be items such as fish, fruit, computer components, or pens and pencils and the like, or can be services.  
           [0003]    From time to time, a supplier of inventory may unfortunately reserve a portion of inventory to slow-turnover requestors (that is requestors that very slowly turnover their reserved portion of inventory). Sometimes, the supplier may be fortunate to reserve another portion of inventory to fast-turnover requestors (that is requestors that quickly turnover their reserved portion of inventory). The portion of inventory reserved for slow-turnover requestors will become stagnant while the portion of inventory reserved for fast-turnover requestors avoids becoming stagnant. The supplier (hereinafter referred to as ‘distributor’) of inventory is prevented from reassigning reserved portions of stagnant inventory over to quick-turnover requestors because the distributor will then suffer the consequence of souring a business relationship with a desirable, fast-turnover requestor (who expects to receive fresh inventory). When portions of reserved inventory become stagnant, the distributor will experience increased costs for carrying the stagnant inventory and then might be unable to recuperate from these losses when the stagnant inventory is eventually sold. Quick-turnover requestors can become disadvantageously prevented or blocked from obtaining inventory allocated or reserved for slow-turnover resellers (thus potentially creating a backlog for the quick-turnover requestor). It is not desirable for a distributor to endure cost increases when portions of reserved inventory age and are not turned over (that is picked or removed) quickly. Additionally, requestors and distributors may be required to each individually operate an inventory management system, which would be an expensive proposition for the requestors. Accordingly, an improvement for allocating inventory would be beneficial.  
         SUMMARY  
         [0004]    The present invention enables a supplier or distributor of inventory to allocate inventory from available pools of inventory to requestors based on a priority sequence identified by the supplier. A distribution arrangement is setup between the supplier and each requestor. The distribution arrangement specifies that the supplier will allocate inventory to the requestor identified in the distribution arrangement. Subsequently, the supplier (under each distribution arrangement) associates one or more availability records wherein each associated availability record identifies one inventory record (each inventory record identifies one pool of inventory) from which inventory will be allocated. Each availability record includes an allocation priority indicator for indicating relative priority between other associated availability records. Inventory is allocated from an inventory record identified by an availability record having a preferred priority indication. The priority indicators indicate a preferred priority sequence for allocating inventory from available pools if inventory. A distribution arrangement specifies a preferred priority sequence for allocating inventory.  
           [0005]    Once a supplier receives a shipment of inventory, an inventory record is created for identifying the received shipment of inventory (or a portion of inventory). An inventory record specifies the current quantity of available inventory, the cost, and date the inventory was received. Once all the pools of available inventory are identified by an inventory record, availability records are created for identifying one inventory record. An availability record indicates that inventory identified by an inventory record is allocatable under a particular distribution arrangement. Each availability record also indicates priority relative to other availability records in which allocation of inventory is based on the priority level of an availability record.  
           [0006]    When a requestor requests inventory from a supplier, the supplier refers to an availability record under the distribution arrangement between supplier and requestor, and subsequently picks allocated inventory associated with the availability record having the preferred priority indication. The supplier may use one or more availability records for identifying one or more existing inventory records and thus permit allocation of inventory depending on the priority level if an availability record.  
           [0007]    In a first aspect of the invention there is provided a method of selectively apportioning inventory of supplies of a supplier to contracted entities having distribution arrangements with the supplier, including creating a record of supplies received in the inventory, from the record of receipt creating availability records of the received supplies for the contracted entities in accordance with the distribution arrangements, and allocating supplies from the inventory to a contracted entity submitting an order for supplies in accordance with an availability record of the supplies for the contracted entity.  
           [0008]    In a second aspect of the invention there is provided a system for selectively apportioning inventory of supplies of a supplier to contracted entities having distribution arrangements with the supplier, the system including means for creating a record of supplies received in the inventory, means for creating availability records of the received supplies from the record of receipt for the contracted entities in accordance with the distribution arrangements, and means for allocating supplies from the inventory to a contracted entity submitting an order for supplies in accordance with an availability record of the supplies for the contracted entity.  
           [0009]    In a third aspect of the invention there is provided computer program product for use in a computer system operatively coupled to a computer readable memory, the computer program product including a computer-readable data storage medium tangibly embodying computer readable program code for directing the computer to selectively apportion inventory of supplies of a supplier to contracted entities having distribution arrangements with the supplier, the computer program product including code for instructing the computer system to create a record of supplies received in the inventory, code for instructing the computer system to create availability records of the received supplies from the record of receipt for the contracted entities in accordance with the distribution arrangements, and code for instructing the computer system to allocate supplies from the inventory to a contracted entity submitting an order for supplies in accordance with an availability record of the supplies for the contracted entity.  
           [0010]    A better understanding of these and other embodiments of the present invention can be obtained with reference to the following drawings and description of the preferred embodiments.  
       
    
    
     BRIEF DESCRIPTION OF THE DRAWINGS  
       [0011]    The embodiments of the present invention will be explained by way of the following drawings:  
         [0012]    [0012]FIG. 1 depicts an inventory allocation environment;  
         [0013]    [0013]FIG. 2 depicts an inventory allocation system embodying aspects of the present invention;  
         [0014]    [0014]FIG. 3 depicts operations for allocating inventory related to the inventory allocation system of FIG. 2; and  
         [0015]    [0015]FIG. 4 depicts operation for setting up the inventory allocation system of FIG. 3. 
     
    
     DETAILED DESCRIPTION  
       [0016]    Background  
         [0017]    [0017]FIG. 1 depicts distribution environment  100  including inventory management (IM) system  102  operated by a distributor, Inventory Management system  106 A and purchase order (PO) system  108 A both operated by reseller ‘A’, Inventory Management system  106 B and Purchase Order system  108 B both operated by reseller ‘B’. Inventory Management system  102 , and Purchase Order systems  108 A,  108 B are operatively networked via network  104  such as the Internet. It will be appreciated that an Inventory Management system can be a subsystem of a larger business system such as an ERP (Enterprise Resource Planning) system. ERP systems generally include integrated subsystems each dedicated for managing specific facets of business operations such as an inventory subsystem, a planning subsystem, a manufacturing subsystem, a sales subsystem, or an accounting subsystem.  
         [0018]    Resellers ‘A’ and ‘B’ use their respective Purchase Order systems  108 A,  108 B to place purchase orders. Purchase Order system  108 A may allocate inventory from reseller ‘A’ Inventory Management system  106 A, may allocate inventory from a distributor&#39;s Inventory Management system  102 , or may initially allocate inventory from reseller ‘A’ Inventory Management system  106 A and then proceed to allocate inventory from the distributor&#39;s Inventory Management system  102  (for the case when Inventory Management system  106 A cannot fulfill any purchase orders). Similarly, Purchase Order system  108 B may allocate inventory from reseller ‘B’ Inventory Management system  106 B or may allocate inventory from the distributor&#39;s Inventory Management system  102 . For the case when the distributor receives requests to allocate inventory, Inventory Management system  102  arranges for the fulfillment of the received purchase orders and may transmit messages pertaining to purchase and/or shipment confirmations back to respective Inventory Management systems  106 A,  106 B.  
         [0019]    Inventory Management system  102  includes memory (not depicted) for maintaining inventory records  110  and  112 . Inventory record  110  indicates or depicts a quantity of inventory received on a specific date (such as September 1). Inventory record  112  indicates another quantity of inventory received on another specific date (such as September 3). When a distributor receives a shipment of inventory, the distributor allocates inventory by exclusively reserving portions of the received shipment of inventory to corresponding resellers. For example, portions ‘A’, ‘B’, and ‘C’ of inventory record  110  represent portions of inventory reserved for resellers ‘A’, ‘B’, and ‘C’ respectively (reseller ‘C’ is not depicted). Portions ‘E’, ‘F’, and ‘G’ of inventory record  112  represent portions of inventory reserved for resellers ‘A’, ‘B’, and ‘C’ respectively. Inventory related to inventory record  110  is older than inventory related to inventory record  112 .  
         [0020]    Preferred Embodiments  
         [0021]    [0021]FIG. 2, depicts an inventory allocation environment  200  including resellers  202  and  204 , distributors  206  and  216 , computer systems  201  and  224 . In a preferred embodiment, distributors  206 ,  216  operate computer system  201 ,  224  respectively to allocate inventory for fulfilling purchase orders related to various resellers (i.e., environment  200  is operated or implemented in a distributed computing environment).  
         [0022]    In an alternative embodiment (not depicted), distributors  206  and  216  interact with a single computer system (i.e., environment  200  is operated on a computer system that accommodates a plurality of distributors in which another business entity owns and/or operates the inventory management system, and the plurality of distributors pay user fees for using the computer system. User fees represent one business model. For example, another business model does not involve user fees in which a manufacturer may provide inventory allocation service for reseller channels. Reseller  202  is prepared to place purchase orders with distributor  206 . Reseller  204  is prepared to place purchase orders with distributor  206  and/or distributor  216 . In a preferred embodiment, resellers  202  and  204  can be e-commerce stores operating from within an adapted version of Webshpere™ Commerce Suite supplied by IBM of Armonk, N.Y.  
         [0023]    Computer system  201  includes computer-readable memory  203  operatively coupled to a CPU (Central Processing Unit, not depicted). Memory  203  stores computer software program  207 , distribution arrangements  208 ,  210 , availability records  212 A,  212 B,  214 A,  214 B, and inventory records  220 ,  222 . Computer software program  207  includes computer-programmed instructions for instructing or directing the CPU to achieve specific tasks or operations as depicted in FIG. 3 and as described in the following description.  
         [0024]    Computer system  224  includes computer-readable memory (not depicted) operatively connected to a CPU (not depicted). The memory stores distribution arrangement  218  and computer software program  207  (however, program  207  is not depicted as being stored in computer program system  224 ).  
         [0025]    Distribution arrangements  208 ,  210  specify inventory allocation priorities to distributor  206  for fulfilling purchase orders received from resellers  202 ,  204  respectively. Distribution arrangement  218  specifies inventory allocation priorities to distributor  216  for fulfilling purchase orders received from reseller  204 .  
         [0026]    Resellers  202  and  204  place or submit purchase orders (not depicted) for purchasing inventory, such as pencils, from distributor  206 . Distributor  206  uses computer system  201  to select allocated inventory for fulfilling received purchase orders. For the case when distributor  206  receives purchase orders from resellers  202  and  204 , distributor  206  removes inventory related to inventory records. Portions of an inventory record are not specifically allocated to any specific resellers, as will be shown below. In an alternative embodiment, a distributor does not directly ship inventory to resellers, in which case the distributor is a re-supplier for resellers.  
         [0027]    Prior to placing or receiving any purchase orders, reseller  202  and distributor  206  set up distribution arrangement  208  that specifies a FIFO picking method, and reseller  204  and distributor  206  set up distribution arrangement  210  that specifies a different, in this case LIFO, picking method. Distribution arrangements  208  and  210  specify that distributor  206  agrees to sell and/or supply inventory to reseller  202 ,  204  respectively. In a preferred embodiment, a distribution arrangement is valid or enforceable from a starting time to an ending time (for example, a distribution arrangement can be valid from August 1 to December 31). In another preferred embodiment, a distribution arrangement specifies a method for picking or removing inventory related to various inventory records. Examples for picking or removing inventory are FIFO (First In First Out) method and LIFO (First In Last Out) method. The FIFO method ensures that older inventory is picked until completely exhausted before picking newer inventory. The LIFO method ensures that newer inventory is picked until completely exhausted before picking older inventory. In an alternative embodiment, resellers do not place their purchase orders with a distributor, in which case the resellers pick or remove inventory controlled by the distributor.  
         [0028]    Distributor  206  receives a shipment of inventory on November 1 and subsequently creates inventory record  220 . Inventory record  220  represents a quantity of inventory which distributor  206  will use to fulfill purchase orders received from various resellers. For the case when distributor  206  decides to pick or remove inventory related to inventory record  220  to fulfill purchase orders received from resellers  202  and  204 , distributor  206  produces availability records  212 A and  212 B that are associated to respective resellers  202  and  204  (under respective distribution arrangements  208  and  210 ). Availability records  212 A and  212 B indicate that distributor  206  desires to fulfill purchase orders received from resellers  202  and  204  respectively by picking or removing inventory related to inventory record  220 . In a preferred embodiment, portions of inventory related to inventory record  220  are not specifically allocated or reserved for resellers, and that inventory as a whole is allocated to one or more resellers (as deemed suitable by a distributor).  
         [0029]    In a preferred embodiment, an availability record has an associated priority number for indicating priority or preference for picking inventory from the availability record versus picking from inventory related to other availability records. Availability record  212 A (which has a priority number of ‘0’) indicates that for the case when reseller  202  (which is associated with distribution arrangement  208 ) places purchase orders for inventory, distributor  206  will pick or remove the inventory related to inventory record  220 , and then arrange for the shipment of the removed inventory to reseller  202  (before picking or removing inventory related to any other availability records having a lower priority attribute that may exist under distribution arrangement  208 ). Availability record  212 B (which has a priority number of ‘0’) indicates that for the case when reseller  204  (which is associated with distribution arrangement  210 ) places purchase orders for inventory, distributor  206  will pick or remove the inventory related to inventory record  220 , and then ship the removed inventory to reseller  204  (before picking inventory related to any other availability records having a lower priority attribute that may exist under distribution arrangement  210 ).  
         [0030]    It will be appreciated that specific portions of inventory related to an inventory record are not expressly reserved for fulfilling purchase orders from specific resellers. Any inventory related to an inventory record can be picked or removed for fulfilling purchase orders received from resellers provided that a distributor has associated an availability record under an appropriate distribution arrangement between the distributor and the resellers. By not specifically reserving portions of inventory for specific resellers, portions of inventory are prevented from becoming stagnant because the inventory is picked based on a first-come-first-served basis when a purchase order is received from the resellers.  
         [0031]    In an alternative embodiment, cost of inventory is associated with an inventory record. All inventory related to an inventory record have the same cost. For example, a shipment of 1,000 pencils has been received by a distributor. The unit cost for a quantity of 750 pencils is $1.00, and the unit cost for a quantity of 250 pencils is $1.10 (the price increased, but the shipment includes the combination of expensive and inexpensive pencils). In this case, the distributor would create for the single physical shipment two distinct inventory records, in which each distinct inventory record will have a related per unit cost.  
         [0032]    There could be other reasons why a single shipment may be broken down into multiple inventory records. For example, a distributor receives a large shipment of 100,000 pencils. The distributor has some distribution arrangements that limit the quantity of inventory available to 10,000 pencils. If such a huge shipment of inventory were related to a single inventory record, then all those resellers with limited-quantity arrangements (that is restricted or limited as to the maximum quantity of pencils) could not be given access to such a single large quantity of inventory. To limit resellers, a distributor may decide to create 20 subgroups of inventory, in which each subgroup includes 5,000 pencils and the subgroups of inventory are then related to various inventory records. For this case, the distribution arrangement provides a method for limiting quantity of inventory related to various inventory records.  
         [0033]    A distribution arrangement is a record indicating that a reseller may allocate inventory from various inventory records (which are held or controlled by a distributor). The distribution arrangement can specify a distributor (that is an entity that manages or owns allocatable inventory records available under the distribution arrangement), a reseller (that is an entity that has a right to pick or select inventory related to various allocatable inventory records available under the distribution arrangement), an indication of a start time (that is the time the distribution arrangement becomes valid or effective), an indication of an end time (that is the time the distribution arrangement stops being effective or become invalid), a picking or an availability customization method (that is the manner in which inventory is to be picked or removed from various groups of inventory), and a precedence indicator (that is a distributor selection indication assigned by a reseller for selecting a preferred distribution arrangement from a group of available distribution arrangements based on a criteria, such as lowest cost supplier of inventory).  
         [0034]    Resellers may create and modify precedence indicators related to various distribution arrangements available to the resellers. In a preferred embodiment, the precedence indicator is not created and/or modified by the distributor. Alternatively, the precedence indicator is created and/or modified by the distributor, in accordance with a preference indicated by a reseller (that is on behalf of the reseller).  
         [0035]    An availability record indicates that inventory has been made available for allocation by a distributor, in which the available inventory is related to an inventory record. An availability record is created under a distribution arrangement. The availability record has a priority indicator for indicating a sequence in which inventory is to be picked from various groups of inventory. The priority of an availability record is normally set by the distributor, according to the picking or availability customization method for the distribution arrangement, to indicate the order in which inventory is allocated for a reseller from the inventory records.  
         [0036]    Distributor  206  receives another shipment of inventory on November 5 and subsequently creates inventory record  222  related to the shipment of inventory. Distributor  206  decides that to fulfill future purchase orders from resellers  202  and  204 , distributor  206  will pick or remove inventory related to inventory record  222  in addition picking or removing inventory related to inventory record  220  (that is there are now several groups of inventory to pick therefrom). For the case when distributor  206  desires to allow picking from inventory related to inventory record  222 , distributor  206  produces availability record  212 B and  214 B to indicate that distributor  206  can also fulfill purchase orders from resellers  202  and  204  (respectively) by removing inventory related to inventory record  222 . Now distributor  206  has several available inventory records (such as inventory records  220  and  222 ) from which to pick or remove inventory for fulfilling purchase orders depending on which availability records exist and the priority indicators related to the availability records.  
         [0037]    For the case when distributor  206  receives purchase orders for inventory from reseller  202  under distribution arrangement  208  and since availability record  212 A indicates a priority ‘0’ status and availability record  214 A indicates priority status ‘−1’, then distributor  206  picks inventory related to inventory record  220  for fulfillment of the purchase order (because availability record  212 A has a related priority of ‘0’ which is the highest priority of the availability records for this distribution arrangement. For the case when inventory record  220  indicates no more inventory is present, distributor  206  picks inventory related to inventory record  222  (because availability record  214 B has a related priority of ‘−1’ which is the highest priority of the availability records associated with available inventory for this distribution arrangement) for fulfillment of the purchase order. Under a FIFO picking method, priorities are assigned to availability records in such a way that newer availability records have lower priority. It will be appreciated that records that eventually indicate no inventory can be removed from computer system  201 .  
         [0038]    In the preferred embodiment, inventory related to a preferred inventory record is removed on the basis of the priority indicated for an availability record. For example, the manner in which inventory is removed can be specified in distribution arrangement  208 , which is set for a FIFO picking method. For the case when distributor  206  prefers to remove inventory in the FIFO manner, inventory related to inventory record  220  is entirely removed before removing any inventory related to inventory record  222  (because inventory record  220  is older than inventory record  222 ). Once inventory related to inventory record  220  is depleted, then inventory related to inventory record  222  can be removed. This is advantageous when distributor  206  wishes to deplete older or aged inventory before picking newer or fresher inventory. Older inventory is indicated by an older date (such as November 1 for inventory record  220 ). Newer inventory is indicated by a newer date (such as November 5 for inventory record  222 ).  
         [0039]    The priority of availability records is set to reflect a picking method. Thus, the picking method is only looked at when inventory records and the corresponding availability records are created. During inventory allocation (which is a performance-critical process since it happens very frequently with a large volume of transactions) all that needs to be looked at is availability record priorities. These are meant to be already set up in such a way as to respect the appropriate picking algorithm.  
         [0040]    Under the LIFO picking method, newer inventory will be picked and depleted before picking older inventory. Availability record  214 B (which has a priority indication of ‘1’ which indicates newest inventory) indicates that for the case when reseller  204  associated with distribution arrangement  210  places purchase orders for inventory, distributor  206  will remove inventory related to inventory record  222  (because related availability record  214 B has a priority indication of ‘1’). However, for the case when inventory record  222  indicates no more related inventory is available for picking, distributor  206  will pick inventory related to inventory record  220  (because the priority status of availability record  212 B is set to ‘0’ which indicates the next available newest inventory). The manner in which inventory is picked by distributor  206  is specified in distribution arrangement  210  related to reseller  204 . For example, the manner of picking inventory is specified as the LIFO picking method.  
         [0041]    An example for using the FIFO picking method is for the case when distributor  206  wishes to pick inventory related to inventory record  220  before picking inventory related to inventory record  222 . Initially, inventory related to inventory  220  is picked until completely depleted. For the case when inventory has been completely depleted from inventory related to inventory record  220 , then inventory related to inventory record  222  is picked. The LIFO picking method requires that newer inventory related to inventory record  222  is picked before inventory related to inventory record  220  is picked.  
         [0042]    It will be appreciated that the inventory (or portions of inventory) related to inventory records  220  or  222  are not reserved for or allocated to any specific resellers. Rather, inventory related to inventory records are made available for picking provided that a distributor refers to availability records related to the specific resellers.  
         [0043]    In the preferred embodiment, distribution arrangements further include precedence indicators. Reseller  204  can place purchase orders with either distributor  206  or distributor  216 . Distributor  206  and reseller  204  have previously set up distribution arrangement  210 . Distributor  216  and reseller  204  set up distribution arrangement  218 . Reseller may be motivated to place purchase orders with distributor  216  because distributor  216  provides an incentive to reseller  204 , such as lower-cost inventory or a sales incentive promotion (such as a free trip to Hawaii, or may reflect the distributor reliability). Reseller  204  sets the precedence indicator related to distribution arrangement  218  to a value of ‘2’ to indicate that purchase orders will be initially placed with distributor  216 . Reseller  204  sets the precedence indicator related to distribution arrangement  210  to a value of ‘1’ to indicate that purchase orders will be placed with distributor  206  when distributor  216  cannot fulfill any purchase orders. Higher precedence distribution arrangements are given preference.  
         [0044]    [0044]FIG. 3 depicts operations of computer program  207  of FIG. 2 for allocating inventory. It is understood that the operations depicted in flowchart  300  will be performed by program  207  operating in computer system  201  unless stated otherwise.  
         [0045]    S 302  indicates the start of operations of the IM system. S 304  indicates that IM system receives a request to purchase inventory. In S 306 , the IM system retrieves distribution arrangements related to the inventory specified in the purchase order. In S 308 , the IM system determines whether the retrieved distribution arrangements have sufficient inventory to fulfill the request, and are valid or enforceable because the purchase order was received when the specified start and stop times are still valid or acceptable. If no, processing continues to S 310  (in which case the order is not fulfilled and processing stops because the purchase order was received either before or after the time that the distribution arrangements are valid). If yes, processing continues to S 312  (in which case inventory will be selected from inventory related to the inventory records because the purchase order was received during the time that the distribution arrangements are enforceable or valid).  
         [0046]    In S 312 , the IM system examines availability records related to the selected distribution arrangements. In S 314 , the IM system selects inventory related to inventory records from which to remove inventory (based on priority indicator related to the availability records). In S 316 , the IM system proceeds with arranging the shipping of inventory from the selected inventory record. In S 318 , operations end.  
         [0047]    In the preferred embodiment, a distribution arrangement can specify a maximum quantity of inventory that can be allocated to a reseller. For example, when the maximum quantity of inventory is 500 and the received shipment of inventory has a quantity of 1000, then an availability record cannot be used for assigning or allocating inventory to the received shipment of inventory because the quantity (of the received shipment of inventory) is larger than the maximum quantity permitted (by the distribution arrangement). In this embodiment, a distributor would need to either split the received inventory into smaller chunks or increase the inventory limit for a reseller.  
         [0048]    In an alternative embodiment, a distribution arrangement can specify a precedence value so that a reseller can place their purchase order with a preferred distributor. For example, a reseller can have two distributors with which to place purchase orders. The reseller may assign a precedence value of ‘2’ to indicate a first preferred distributor (with which to place purchase orders), and a precedence value of ‘1’ to indicate a second preferred distributor (with which to place a purchase order when the first preferred distributor cannot fulfill a purchase order). When the reseller is ready to place a purchase order, the order will be placed with the distributor having the highest precedence value. For the case when the distributor cannot fulfill the purchase order, then the purchase order is placed with the distributor having the next highest precedence value.  
         [0049]    It will be appreciated that the embodiments of the present invention can be implemented on a hosted computer environment or can be implemented on a distributed computer environment.  
         [0050]    Referring to FIG. 4, there is depicted operations of computer program  207  of FIG. 2 for directing the CPU related to computer system  201  for setting up an allocation environment. It is understood that the operations depicted in flowchart  300  will be performed by computer program  207  operating in memory of computer system  201  unless stated otherwise.  
         [0051]    In S 402 , operations of computer program  207  begins. In S 404 , computer program  207  (stored in memory  203 ) is directed by distributor  206  to setup and/or assign distribution arrangement  208  between distributor  206  and reseller  202 , and to assign distribution arrangement  210  between distributor  206  and reseller  204 .  
         [0052]    In S 406 , distributor  206  receives inventory or a shipment of inventory. In S 408 , computer program  207  is directed by distributor  206  to setup and/or assign an inventory record related to the received inventory. For example, distributor  206  assigns inventory record  220  related to the received inventory record, which was received on November 1.  
         [0053]    In S 410 , computer program  207  is directed by distributor  207  to setup and/or assign an availability record to the assigned distribution arrangement. For example, once inventory record  220  is assigned to the received inventory, availability record  212 A is created and assigned to distribution arrangement  208  which would allow allocation of inventory related to inventory record  220  for fulfillment of purchase orders received from reseller  202 . In S 412 , operations of computer program  207  stops. It will be appreciated that flowchart  400  can be adapted to determine whether operations S 402 , S 404 , S 408 , and S 410  should be performed prior to performing any of these operations. For example, prior to executing operation S 408 , flowchart  400  can include an operation to determine whether there are any distributions agreements that an availability record can be assigned thereto (with corresponding ‘yes’ and ‘no’ outcomes).  
         [0054]    It will be appreciated that variations of some elements are possible to adapt the invention for specific conditions or functions. The concepts of the present invention can be further extended to a variety of other applications that are clearly within the scope of this invention. Having thus described the present invention with respect to the preferred embodiments as implemented, it will be apparent to those skilled in the art that many modifications and enhancements are possible to the present invention without departing from the basic concepts as described in the preferred embodiment of the present invention. Therefore, what is intended to be protected by way of letters patent should be limited only by the scope of the following claims.  
         [0055]    The present invention may be embodied in other specific forms without departing from the spirit or essential characteristics thereof. Therefore, the presently discussed embodiments are considered to be illustrative and not restrictive, the scope of the invention being indicated by the appended claims rather than the foregoing description, and all changes which come within the meaning and range of equivalency of the claims are therefore intended to be embraced therein.