Aha! Glad to know I was on the right track with it being a Local Pickup or Local Delivery configuration issue 
I hope this helps resolve the issue for your merchant and glad that you had received a reply eventually.
Have a great week,
Josh
Topic summary
Issue: Subscriptions fail to create a billing attempt with error “INVENTORY_ALLOCATIONS_NOT_FOUND – No inventory location found or enabled,” despite the product being in stock and past orders succeeding.
Investigation: Guidance focused on delivery configuration, specifically Local Pickup and Local Delivery settings, as common misconfigurations that block inventory allocation.
Root cause (confirmed by API support): The subscription contract was set to “Pickup in Store,” but the merchant had Local Pickup disabled. Enabling Local Pickup is required for pickup-based subscription contracts so inventory can be allocated to the pickup location.
Outcome: The identified configuration mismatch was communicated to the merchant as the fix. This aligns with earlier advice to verify Local Pickup/Delivery settings.
Support context: Initial difficulty escalating via partner support due to lack of X-Request-IDs; later successfully escalated and answered by the API team.
Current status: Another merchant using Loop Subscriptions reports the same error persisting with Local Pickup enabled and no recent delivery-option changes. They seek a Shopify contact for deeper debugging. Resolution for this new case is pending.