the sales order and purchasing processes
DESCRIPTION
The sales order and purchasing processes. MIS2101: Management Information Systems. Based on material developed by C.J. Marselis. Sales order process: The sales organization. A sales organization is responsible for negotiating sales conditions and distributing goods and services - PowerPoint PPT PresentationTRANSCRIPT
The sales order and purchasing processes
MIS2101: Management Information Systems
Based on material developed by C.J. Marselis
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Sales order process: The sales organization
A sales organization is responsible for negotiating sales conditions and distributing goods and services
It represents the top organizational level to which you sum sales figures
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Shipping Point
A fixed location that carries out shipping activities. One plant can have multiple shipping points. A shipping point can serve multiple plants. Lead times for determining delivery dates are
associated with shipping points.
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Customer Order Cycle
Pre-Sales ActivitiesSales Order Processing
DeliveryBilling
Inventory Sourcing
Payment
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Pre-Sales ActivitiesSales Order Processing
Pre-salesCustomer databasesContracts
Sales order processingCreation of a document regarding a sale
• Customer, materials ordered, delivery information, billing information, etc.
Information is retrieved from Master (static) Data whenever possible
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Inventory Sourcing
Getting the “stuff” for delivery Check availability (inventory) Where to get the product
From the warehouseFrom the production floorFrom an external supplier
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Delivery
It isn’t physical delivery – remember systems deal in data
Provide delivery and packing information Goods issue
Updating internal accounting and inventory data
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Billing and Payment
Billing The invoice Created from sales order and delivery document Debits the customer’s accounts receivable and
credits revenue Payment
Posting payments against invoices Reconcile differences
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The Whole Process
Quotation
Contact
Schedulingagreement
Order
Delivery Goods issue
Shipment
Invoice
Accounts ReceivableMaterial Stock
Account
Inquiry
Contract
Pre-SalesPre-Sales
Sales OrderProcessingSales OrderProcessing
Delivery/TransportationDelivery/Transportation Transfer Order
BillingBilling
Payment/AccountingPayment/Accounting
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Inventory SourcingInventory Sourcing
Sale
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Document flow
Order Delivery Invoice Accounting
The sales order process consists of a chain of steps
Each step in the process causes the creation of a document used to track the progress of the order
All changes to documents (sales orders, delivery, etc.) create a document to keep track of the changes
Document Flow in a Sales Order:
• Order
• Delivery terms
• Transfer of goods
• Invoice
• Accounting
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Creating a customer order
Sold-to party 2540-00
Item Material Quantity 1 1400-500-00 30 2 1400-100-00 20
Material Master DB
Customer Master DB
The Order
Remember, Master Databases are used by
everyone in the company to ensure uniformity of
data!
An order is created from the Master Data AND the
transaction data
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Shipping and Delivery
The delivery date is a function of Time for inventory
sourcing Time to “load the
truck” (or train, etc.)
Time in transit There are multiple
ways to ship Air, train, truck
RequestedDelivery
DateGoods
issue dateLoading
DateTransportationPlanning Date
MaterialAvailability DateOrder Date
Transit TimeLoading Time
Pick Pack and Stage
TransportationLead Time
The R/3 System uses thelonger of these two times in
calculating delivery scheduling.
RequestedDelivery
DateGoods
issue dateLoading
DateTransportationPlanning Date
MaterialAvailability DateOrder Date
Transit TimeLoading Time
Pick Pack and Stage
TransportationLead Time
The R/3 System uses thelonger of these two times in
calculating delivery scheduling.
ConfirmedDelivery
DateGoods
issue dateLoading
DateTransportationPlanning Date
New MaterialAvailability DateOrder Date
Transit TimeLoading Time
Pick Pack and Stage
TransportationLead Time
The confirmed delivery dateis derived by the R/3 System
using forward scheduling basedon the new material availability date
ConfirmedDelivery
DateGoods
issue dateLoading
DateTransportationPlanning Date
New MaterialAvailability DateOrder Date
Transit TimeLoading Time
Pick Pack and Stage
TransportationLead Time
The confirmed delivery dateis derived by the R/3 System
using forward scheduling basedon the new material availability date
Backward scheduling from a delivery date
Forward scheduling to a delivery date
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Billing and Payment
More complex than you might think
You can have Multiple invoices per
delivery Multiple deliveries per
invoice Multiple payments per
invoice Multiple invoices
covered by a single payment
Sales Order Delivery Invoice
Invoice
Sales Order Delivery
Delivery
Invoice
Invoice
Delivery
Sales Order
Sales Order
Delivery
Delivery
Invoice
InvoiceSplit
SeparateInvoiceper delivery
CollectiveInvoice
Sales Order Delivery Invoice
Invoice
Sales Order Delivery
Delivery
Invoice
Invoice
Delivery
Sales Order
Sales Order
Delivery
Delivery
Invoice
InvoiceSplit
SeparateInvoiceper delivery
CollectiveInvoice
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The purchasing process
In the sales process, the organization is the supplier
In the purchasing process, the organization is the buyer
The movement of goods from supplier to the end customer is the “supply chain”Supplier Organization Customer
How do you think the supply chain relates to the value chain?
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Purchasing Process
Create Purchase Requisition Where analysis/vendor selection occurs
Create Purchase Order from Requisition Requisition items can be used to generate multiple
purchase orders Create Goods Receipt Create Invoice Receipt Post Outgoing Payment
There is no purchasing “document flow”
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Purchasing Process
GoodsReceipt
PayInvoice
PurchaseRequisition
PurchaseOrder
InvoiceReceipt
InternalDemand
Cus
tom
er
Vendor
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Vendor Master Data
Created for every vendor General data
Name, address, phone number Company code data
Accounting data: currency, payment terms
Purchasing dataContacts, delivery terms
Vendor data is like a
company’s CRM data in
reverse!