Inventory allocation

Q:  We currently do not have a Sales Office in Sereno and therefore ship all products produced in Sereno to Merica for sale.  Considering this, we are unsure how the Sereno produced products are distributed in Merica.

Specifically:

1.  Is the Sereno produced product equally distributed to all three Merica areas?

2.  Is the Sereno produced product distributed only to those Merica areas that do not have an operating production facility?

3.  Is the Sereno produced product distributed to all three areas within Merica, but only in a ratio that is the same as the ratio of Sales Office orders for each of the areas?

A:  If there is a plant but no sales office in Sereno, and if there are unsold goods at the end of the quarter from that plant, they would show up as "inventory."  Normally, goods held in inventory are not shipped to other market areas (see Player's Manual, page 18), but held for sale by the sales office in the same area.  Where there is a plant, but no sales office, the goods from inventory are added to current production to establish the amount of goods "available for shipment" from Sereno (as outlined in Marketing FAQ "Inventory policies).

If goods are available for shipment from more than one plant, sales office orders are filled first from non-home area plants beginning with Sereno, then from domestic non-home areas, and finally from the home area.  They are not spread equally across other market areas without a plant.  For example, if you had a Sereno plant, but none in areas 1 and 2, Sereno production would be used to fill the Area 1 sales office orders first.  Then, if more goods from Sereno were still available, they would be shipped to Area 2.  Any unfilled sales office orders in Area 2 would be shipped from the Area 3 plant.  Goods would not be shipped to Area 3 unless there were not sufficient goods available from Area 3 production.

If you are producing goods in three domestic areas, the sales office orders in those areas will be filled first from the plants in those areas.  If there is not sufficient production in an area to satisfy the sales office in the same area, goods will be shipped from other areas--first from non-home areas (starting with Sereno), then from the home area.