Sales Order Management

Overview

Sales order management involves much more than taking an order and shipping it. Today's requirements include sophisticated order management, inventory allocation, and promotional pricing. Other important functions include:

Ø  Up-to-the-minute credit checking

Ø  Item availability

Ø  Available-to-promise inventory

 You must also manage pricing efficiently, given the complexity of customer- and market-specific contracts, special promotions, allowances, and date effectiveness.

Customer service is another key ingredient to your company's success. You can enhance customer service by using the Sales Order Management system to create order templates, standing or blanket orders, and quote orders. Also, the Sales Order Management system provides additional customer service support through online displays that provide the following:

Ø  Pertinent order, inventory, transportation, and financial information

Ø  Net profitability of a product line when promotions, discounts, and allowances are applied

System Integration

J.D. Edwards Sales Order Management system works hand-in-hand with other distribution/logistics and manufacturing systems to ensure that customer demand is met. Supply and demand components must balance to ensure that this takes place. The key is integration and the proactive use of distribution and logistics information.

Integration with Accounting and Distribution Systems

The following illustrates and describes how the Sales Order Management system integrates with general accounting and other distribution systems

Sales Order Management

Ø  The system retrieves item prices and costs from the Inventory Management system for sales orders.

Ø  The system updates the general ledger and creates accounts receivable entries for invoices. In addition, the system records inventory, cost of goods sold (COGS), revenue, and tax transactions for cash receipts processing:

Ø  Inventory

Ø  Cost of Goods Sold (COGS)

Ø  Revenue 

Ø  Tax transactions

General Accounting The hub of the integration circle is J.D. Edwards General Accounting system which tracks sales order accounting. All distribution systems interface with the General Accounting system through the use of automatic accounting instructions (AAIs).

Address Book The Sales Order Management system works with the Address Book system to retrieve up-to-date customer billing and warehouse address information.

Inventory Management The Inventory Management system stores item information for the Sales Order Management, Purchase Management, and manufacturing systems. It also stores sales and purchasing costs and quantities available by location and tracks holds for locations that should not be sold from. Any change in inventory valuation, count variances, or movement updates the general ledger.

Purchase Management The Purchase Management system supports direct ship order and transfer order processing. You can use the system to release receipts to backordered items.

Advanced Pricing Optionally, you can use the Advanced Pricing system in conjunction with the Sales Order Management system. This system integrates with many of the price-related programs in the Sales Order Management system and provides additional pricing, preference, reporting, and setup functionality

Advanced Warehouse Management Optionally, you can use the Advanced Warehouse Management system in conjunction with the Sales Order Management system. This system integrates with many of the programs related to items and provides additional reporting, picking, and setup functionality

Distribution Processes

J.D. Edwards recognizes five main distribution processes and provides corresponding systems for each of them:

Ø  Purchase items - Purchase Management system

Ø  Manufacture items - Manufacturing planning and production management systems

Ø  Manage items in inventory - Inventory Management and Advanced Warehouse Management systems 

Ø  Sell items to customer - Sales Order Management system

You may use some or all of them, depending upon the nature of your business.

Of these, Sales Order Management is the system you use to sell items to customers and to record those sales

Sales Order Process

Sales Order Management includes the following basic steps:

Ø  Enter an order - Identify the customer, item number, quantity, and perhaps the location of items being sold on a sales order.

Ø  Print a pick slip - Inform the warehouse of activity.

Ø  Confirm a shipment - Validate and record the quantity shipped and the location. This information comes from the pick slip that the warehouse returns.

Ø  Print an invoice - Create a billing copy. The invoice specifies for the customer what items they are being charged for, the shipping address for those items, and any additional charges, such as taxes or shipping.

Ø  Update the records - Record invoice information to the general ledger and accounts receivable. After you ship an order, the system updates the inventory and sales history records, and transfers financial information to the general ledger and accounts receivable files.

The process that you define for your sales orders may include additional steps, depending on the types of customers that you have.

Processing Steps and Status Codes

Each step of the order process has user defined status codes that you define in the order activity rules. The system uses each status code to track where an order is within the sales order process. For example, an order that is confirmed for shipment may have a status code of 560. The following graphic illustrates the relationship between processing steps and status codes

Activities Related to Sales Order Management

File updates, reports, and sales order document generation, including invoices and pick slips, are the types of activity resulting from sales order entry. The following graphic illustrates the sales order processing flow 

Features

The Sales Order Management system provides many features:

Ø  Extensive user defined information 

Ø  Flexible pricing and discounting that supports promotions, contracts, and allowances

Ø  Recurring order and order template processing 

Ø  Customer/item preference profiles

Ø  Online inventory availability and available-to-promise information 

Ø  Substitute and associated item processing

Ø  Multiple templates for a single customer 

Ø  Comprehensive order and line and status tracking

Sales Order Entry - Objectives

Ø  To enter and change sales order information using the page, line, and batch modes

Ø  To understand the standard features of each type of order entry 

Ø  To understand the different tasks that you can perform using header and detail information

Ø  To add and view messages to header and detail information in sales orders 

Ø  To add a sales order using templates

Ø  To copy sales orders using order history

Ø  To create international sales orders

Ø  To create recurring sales orders

A sales order has two types of information:

Header information

This information relates to an entire order but primarily to customers. The system maintains this information in the Sales Order Heading table (F4201). The system also retrieves information from the Address Book (F0101), the Customer Master, and the Billing Instructions (F0301) tables to complete the order.

Detail information

This information primarily relates to individual lines in a sales order and to items. The system maintains this information in the Sales Order Detail table (F4211). The system also retrieves information from the Sales Order Heading (F4201), the Item Master (F4101), the Item Location (F41021), the Billing Instructions (F0301) and the Customer Master tables to complete the order.

Perquisites before entering a Sales Order:

Ø  Verify that the following information is set up prior to entering sales orders:

Ø  Address information for each customer in the Address Book table (F0101)

Ø  Billing instructions for each customer in the Billing Instructions (F0301) and Customer Master tables 

Ø  Branch/plant information for each of your branch/plants in the Branch/Plant Constants table (F41001) 

Ø  Item and branch/plant information in the Item Branch table (F4102), the Item Location table (F41021), and Item Master table (F4101) for each item that you stock

Ø  Default location and printers for your terminal or user profile in the Default Location and Printers table (F40095)

Ø  Verify that multi-currency processing is set up if you are processing international orders that use different currencies