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Warehouse Putaway Request is being defaulted to the 'O' (Overflow) location

When a 2 phase warehouse putaway request is being routed to Phase 2, it is defaulting into the an Overflow location.

Phase 1 - From Location = LOC1, To Location = Blank

Phase 2 - From Location = Blank, To Location = O (Overflow)

Question: What controls this location assignment and why is the To Location in Phase 2 defaulting to Overflow?

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