This chapter contains these topics:
Sales order management involves much more than taking an order and shipping it. Today's requirements include sophisticated order management, inventory allocation, kitting, and promotional pricing. The Sales Order Management system allows you to address these issues.
When with Load and Delivery Management and Bulk Stock Management, the Sales Order Management system also provides solutions to meet the specific needs of energy and chemical industries. These additional requirements include ambient and standard temperature readings, trip-building, load and delivery confirmation, and quality test results.
Extensive user defined information
Recurring order and order template processing
Customer and item preference profiles
Online inventory availability and available-to-promise information
Comprehensive order and line status tracking
Flexible pricing and discounting, which supports promotions, contracts, and allowances.
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:
Pertinent order, inventory, transportation, and financial information
Net profitability of a product line when promotions, discounts, and allowances are applied
You must manage pricing efficiently, given the complexity of customer- and market-specific contracts, special promotions, allowances, and date effectiveness. The Sales Order Management system allows you to set up a flexible base pricing structure. You can then define price adjustments to revise and update prices when necessary.
JD Edwards World Sales Order Management system works 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.
The following illustrates and describes how the Sales Order Management system integrates with general accounting and other distribution systems.
The system retrieves item prices and costs from the Inventory Management system for sales orders.
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.
The central point of integration is JD Edwards World 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).
The Sales Order Management system works with the Address Book system to retrieve up-to-date customer billing and warehouse address information.
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 used for transactions. Any change in inventory valuation, count variances, or movement updates the general ledger.
The Procurement system supports direct ship order and transfer order processing. You can use the system to release receipts to backordered items.
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.
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.
The Sales Order Management can be closely integrated with the Load and Delivery Management system to provide advanced sales order (ECS) functionality.
Electronic Data Interchange (EDI) is the computer-to-computer exchange of business transactions, such as purchase orders, invoices, and shipping notices, in a standard format that most computers can process.
The Electronic Commerce system consists of JD Edwards World System 47, which is the application interface containing application files and interface programs. System 47 works in conjunction with a third party translation software that translates EDI standard data into a JD Edwards World file format so that the JD Edwards World application software can manage the data.
When you receive documents, your translator software:
Retrieves the data via network communications
Translates the data from EDI Standard format to JD Edwards World application file format
Moves the translated data into the JD Edwards World EDI interface files
The JD Edwards World Electronic Commerce system then moves the data into the appropriate application files.
When you send documents, the system performs the procedures above in reverse order. The following graphic illustrates the EDI process:
The EDI documents that JD Edwards World currently supports appear in the following table. The table includes corresponding codes for ANSI and EDIFACT, which are EDI standards organizations.
|Transaction||ANSI||EDIFACT||Inbound To||Outbound From|
|Purchase Order Acknowledgement||855||ORDRSP||Procurement||Sales|
|Receiving Advice||861||IFTMAN||Procurement, Sales||Procurement|
|Request for Quote||840||REQUOT||Sales||Procurement|
|Response to Request for Quote||843||QUOTES||Procurement||Sales|
|Purchase Order Change||860||ORDCHG||Sales||Procurement|
|Purchase Order Change Acknowledgement||865||ORDRSP||Procurement||Sales|
|Product Transfer and Resale||867||SLSRPT||Sales, A/R, Inventory, G/L||Sales|
|Price Sales Catalog||832||PRICAT||PDM||PDM|
|Product Activity Data||852||INVRPT||Sales/ Inventory||Inventory|
This section describes the features of sale order management.
Order entry allows you to record information about your customers and the items they have ordered. When you enter a sales order, the system automatically enters pertinent information that currently exists in the customer, item, preference, and pricing records. Sales order processing begins as soon as you complete order entry.
The Sales Order Management system provides the following types of additional orders to accommodate specific ordering situations:
Direct ship orders
Interbranch sales orders
Sales orders with manual invoice
You enter these types of orders in the same way that you enter basic sales orders. However, the system processes each type of order differently. Some orders, such as blanket and quote orders, can be prerequisites to actual sales orders. That is, you must enter these types of orders before you can enter sales orders from them.
You use credit orders to accept returned items from a customer and to issue credit to the customer. When you enter credit information manually, the system applies the current unit price for the credited item. When you create a credit order, the system retrieves the credit information based on the unit price that the customer actually paid instead of today's current or average cost.
With some advance preparation and setup, you can significantly speed up the order entry process. One way to do this is to create and assign order templates for your customers. Templates speed the order entry process by reducing repetition.
An order template displays frequently ordered items and quantities. You can create the two types of templates:
|Standard templates||A standard template applies to all customers. You can assign a standard template to display every time you enter an order.|
|Customer-specific templates||Customer-specific templates include a specific customer's most frequently ordered items. You can display a customer-specific template only when you enter orders for that customer.|
You might have orders on hold for several reasons. For example, you might place orders on hold that do not meet margin requirements. When an order is on hold, it must be released back into the processing cycle for any additional processing to take place.
The system can withhold an order or order line from the processing cycle if you do not have the quantity to fill the order or order line. This type of hold is a backorder. You release backorders when inventory becomes available.
After you enter sales orders, you typically advance them through the processing cycle in the following sequence:
Print control pick lists and pick slips
Update information to the general ledger (G/L)
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, if you are ready to confirm for shipment, the order might have a status code of 560.
The process that you define for your sales orders may include additional steps, depending on the types of customers that you have.
You can review and analyze sales order information and generate reports to track the status of sales orders and invoices. For example, you can review the present status of any order, such as an order that is on hold, to accurately plan for future needs.
When entering or reviewing a sales order, you can quickly access item information, such as the item number, availability, quantity cost-breaks, and so on. This is helpful when you are speaking directly to the customer.
You can also access information about customer accounts and open and closed sales orders. For example, you can use the Check Credit program to compare a customer's total accounts receivable and open orders with their credit limit. You can also review sales history information and billing information that doesn't print on the invoice that the customer receives.
You perform end of day processing to complete the order processing cycle. Performing end of day processing consists of running batch programs to:
Calculate individual billing cycles for customers
Print periodic invoices that are due
Update all tables and records related to customer sales
Post journal entries resulting from the order processing cycle
You should run the Update Customer Sales program each day to keep the most accurate sales information. You update your sales information on a daily basis to do the following:
Keep accounts receivable records current
Provide daily activity reports
Keep general ledger accounts current for inventory, cost of goods sold, sales, and freight
Keep inventory on-hand balances accurate
Keep interim sales and commission reports accurate
For each item that you sell, you must define the price at which to sell it. You use Sales Order Management pricing to define a base pricing structure. The system uses this base pricing structure to retrieve prices when you enter items on an order and to calculate price adjustments and updates. You can define base prices for any combination of items, item groups, customers, or customer groups.
After you define base prices, you can set up price adjustments that might include the following types of price calculations:
Contract pricing, which applies special pricing for an item to a single customer or customer group
Trade discount pricing, which is a discount percentage on all items for a specific customer
Cash discount pricing, which you can apply to individual sales order detail lines
Repricing, which are additional discounts or markups that you can set up or to recalculate sales orders
You can use preferences to customize the way sales orders are processed. For sales order processing, JD Edwards World has provided preferences that you can customize to meet your specific business requirements.
Typically, you create preferences when you have consistent business requirements that differ from the default values for the Sales Order Management system. For example, you can create preferences to suit the needs of:
Your customer's specific requirements
Your company's policies
Regulatory agencies' rules
You can customize the Sales Order Management system to meet your company's needs and customer demand.
Before you use the Sales Order Management system to process sales orders, you must perform the following system setup tasks:
Set up constants that provide the system with default information for day-to-day transactions within a branch/plant
Set up customer billing instructions, which are rules the system uses in processing a customer's order
Set up order line types, which are codes that determine how the system processes a detail line in an order
Set up order activity rules to establish the sequence of allowable steps that an order takes from beginning to end
Define the codes that the system uses to place sales orders on hold
Define branch sales markups, which are transfer costs that apply to interbranch sales or transfer orders
Set up commission information for a specific salesperson or a group of salespeople
Set up automatic accounting instructions (AAIs), which provide the Sales Order Management system with accounting information and general ledger relationships for interacting with the General Accounting system