OP Flow of Processing

The Flow of Processing section helps you learn how to operate the software for the first time and provides guidelines for operating the module after it is installed. Study this section in conjunction with the Operations section of this manual.

The Sales Order Processing module is closely related to the Accounts Receivable, Inventory Control, and Sales Analysis modules. You should understand how the other modules work to obtain a complete picture of how orders/invoices are processed. If you are using these other modules, refer to their documentation as necessary.

Flow of Daily Processing

Daily processing refers to the procedures performed each day while using the Sales Order Processing module, such as entering orders/invoices, issuing credits, creating quotes, releasing orders, running registers, and so forth. Because the system is designed to accommodate a wide variety of sales situations, its use depends on the type of business your company operates.

Order entry may be used in several ways: interactively, as when a salesperson enters a telephone order; in batches, as for orders and purchase orders received in the mail; or one-step entry, such as a sale that is filled on the spot rather than picked in the warehouse. Each of these types of orders may be handled either as a cash sale, in which payment is received when the order is filled, or as an open account sale, for which an invoice is created.

Invoice entry is used to create a one-step invoice for which an order does not exist, to bill an existing open account order that just shipped, or to record the cash receipt of a shipped cash sale.

To audit the flow of daily processing, several reports are available that can give you the status of customer accounts or inventory items, shipping schedules, price inquiries, order details, etc. These reports may be created at any time.

Entering Orders/Invoices

When you use the Sales Order Entry task to create a customer order, the ordered items are flagged as committed if their scheduled shipping dates fall within a parameterized commitment window. A pick list is generated that can be created when you finish entering the order, or added to a batch of orders for printing at a later time. In addition, when you enter an order for an open account customer, the customer’s available credit amount is reduced by the dollar value of the committed items. Orders can be automatically converted to invoices.

One-step or direct processing is most often used for over-the-counter transactions filled at the point of sale, sales recorded after the fact, or similar transactions. Picking lists are not needed. When such a transaction is desired for a cash or credit sale, the Order Entry task is bypassed and the Invoice Entry task is used in its place.

Use the Order Entry task to process cash sales in a mail order or other similar sales environment in which cash, check, or credit card payment accompanies the order. Use the Invoice Entry task to invoice existing open account orders already picked and shipped, or to record cash receipts after cash orders are shipped. See the Operations section for instructions on using these tasks.

NOTE: If you have a standard cash customer account number, you may use this number to record all cash sales. This may not be desirable, however, if you want to track customer information for sales reporting and promotional purposes.

Entering Unique Orders

The Sales Order Processing module is capable of creating orders and invoices using historical information from previous invoices. You can also create credit memos for customers or quotes that can later be converted to orders.

Creating an Order From an Historical Invoice

If a customer wishes to place an order/invoice that is the same as or very similar to a previous order, you can create a new order by copying an historical invoice. When you duplicate an historical invoice, a new order/invoice is created with the same contents as the historical invoice but with a new order/invoice number. You can modify the order/invoice as needed.

Creating a Credit Memo From an Historical Invoice

A credit memo may be issued to a customer for a returned product, damaged goods, items lost by the shipper, etc. To create a credit memo from an historical invoice, use the Invoice Entry task and follow the steps outlined previously for Creating an Order From an Historical Invoice. The selected invoice creates a credit memo with the same contents as the historical invoice. If no modifications are made to the credit memo, credit is issued for all items on the invoice, and all inventory items are automatically returned to stock. Returned items are automatically returned to stock during the Sales Register update.

Credit memos may be created individually or in batch with the Invoice Printing task. When they are created in batch, there is no way to distinguish them from the other invoices unless you have identified them when they are created. You can identify the credit memo using one of the following procedures:

For a manual entry in the Ship-To field, select Manual Ship To (M), and enter Credit Memo in the first Ship-To Address field.
Enter Credit Memo in the PO Number field.
Create an M (Memo) detail line and enter Credit Memo as the text for the message line.

NOTE: The numbers assigned to credit memos are from the same sequence as invoice numbers. There are no separate numbering systems.

If you do not want credit issued for all items on the invoice, delete or modify the detail lines as needed. Enter the quantity of the item returned to stock as a negative number in the Order field flags this item as returned to stock. Repeat for each item being returned to stock.

A credit memo is sometimes issued for material that cannot be returned to stock. This happens if the customer’s order was damaged or lost by the shipper, if the material being returned is not a standard product, and so forth. This type of credit memo must be created with an order/invoice line code for drop ship items. If such a line code does not exist, one must be created before you can enter the memo.

To issue a credit for items not returned to stock, enter a drop ship code in the Line Cd field of the item’s detail line. In the Qty Ord field, enter the quantity of the item that is credited as a negative number. Repeat for each item credited but not returned to stock.

Creating a Quote

Use the Sales Order Entry task to prepare an itemized quote or bid for customers who request pricing information. Quotes can be created individually at the completion of order entry, or with the Order/Picking List task.

A quote is entered in the same manner as a standard sales order except that for Order Type the selection is Quote (P) on the Basics tab. The detail line items entered on a quote never affect committed quantities in the inventory master file. No customer credit information is affected by the entering of the quote.

Once a quote is created, it remains on file in Order Entry until it is either deleted or converted to a Sale (S). Individual line items may be added to or deleted from a quote before or after it is converted to a standard order.

To convert a quote to a standard sales order, simply recall the quote by customer and order number and change the Order Type to Sale (S). The system will then prompt you to confirm that you want to take this action.

After a quote is converted, it can be invoiced in the same manner that any standard sales order is invoiced. The order is committed based on the ship date.

Reviewing Your Orders/Invoices

Several reports are available for reviewing the status of open orders/invoices. These reports may be created at any time.

Open Order Detail Report

Use this report to view all or selected open order items by customer, with a recap by product code. You may specify a range of customer numbers and order dates, an order taker identification code, and a salesperson code. Open orders that have been printed, open orders that have not been printed, or both may be shown. You may also choose to include open orders, open backorders, open orders on credit hold, non-stock orders, or any combination of these.

Order Status Report by Customer

Use this report to view the status of orders by customer. Open orders are sorted in customer number sequence, with an option to print open orders, price quotations, backorders, credit held orders, or any combination of these. The order number, order date, ship date, shipping method, discount terms, and order type are included.

Order Status Report by Item

This report shows the status of inventory items on order. Open orders are sorted in inventory item number sequence, with optional reporting by a specific product type and warehouse id. Dollar amount and quantity totals are provided by customer and order number, along with on-hand, committed and available quantity totals. You may also choose to include open orders, quoted orders, open backorders, and open orders on credit hold or any combination of these. This report can be created in a summary or detail format.

Shipping Schedule Report

This report shows all items due to be shipped, aged by an operator-defined date and number of aging days. It is used to manage future orders, generate final assembly lists, and keep shipments on schedule. You can create it in summary or detail format for a selected warehouse and product type. You may also choose to print open orders, quotations, backorders, orders on credit hold, all orders, or any combination of orders. This report can be created in a summary or detail format.

Customer Job Report

Print this report to view customer sales itemized by job number. The Use Customer Job Numbers? checkbox in the OP Parameters Maintenance task must be checked for this report to generate. Customer and job descriptions are included. Total dollar sales to date are shown by job, along with a preliminary lien number and date (if any), the first shipment date for the job site, and so forth. You can select beginning and ending customer numbers.

Invoice Edit Report

Print this report to view all invoices on file by customer number and order number range. You can list invoices created by a single person or all entry personnel; list printed invoices, unprinted invoices, or both; show orders within a particular range; and select beginning and ending customer numbers.

Printing Orders/Invoices

You can print orders/invoices in one of two ways: individually or in a batch. Individual orders/invoices are printed at the end of order/invoice entry with the use of the [Print Now] button. Orders/invoices not printed individually are stored in a batch file and printed with the Sales Order Picking List and Invoice Printing tasks.

Once an individual order/invoice is printed it will not print again unless the order/invoice is recalled and you select it for reprinting. Orders/invoices printed in a batch remain there until you update the print file. When the batch print file is updated, those orders/invoices are removed and you can only print them again by selecting them for reprinting.

NOTE: It is important to perform batch order printing at least once each business day, regardless of whether batch orders exist, in order to print any backorders that have been generated.

The Unprinted Orders option of the Open Order Detail Report may be used to audit orders before printing. If any order is not correct, return to the Sales Order Entry task and make the necessary changes.

The Unprinted Invoices option of the Invoice Edit Report may be used to audit invoices before printing. If any invoice is not correct, return to the Invoice Entry task and make the necessary changes.

The Sales Order Picking List can be printed during Order Entry or with the Batch report option. The printed orders give item warehouse locations for picking the ordered items and blanks for recording the number of cartons and the shipping weights. Prices may be shown or excluded. Multiple copies can be output during the printer selection dialog.

NOTE: The Sales Order Picking List task only prints orders with committed items. In addition, an order that is converted to an invoice is no longer considered to exist as an order and is not printed by the Order/Picking List task.

A general message can be printed on all invoices in the batch. Multiple copies can be output during the printer selection dialog. Invoices should be mailed to customers after printing and updating.

Running the Sales Register

Print the Sales Register at the end of each business day. The Sales Register lists all invoices updated by the Invoice Printing task since the last Sales Register update and can be printed in either customer or invoice number order. Credit memos appear on the register in a column labeled “Returns.”

If the Cash Sales checkbox in the Order Processing Parameters maintenance task is marked, a Cash Sales Register prints after the Sales Register showing all cash sales since the last update. The Cash Sales Register lists separate totals for cash, check, and charge receipts.

If the Print Sales GL Detail checkbox in the Order Processing Parameters task is marked, the Sales Register includes an audit report listing all general ledger postings by invoice line item.

If desired, you may print invoices and run the Sales Register without updating any time you want to see the day’s sales. This is to verify that a current, complete audit trail of your Sales Register exists before the update is performed.

Check the Sales Register carefully to make sure all invoices are correct. Use the Invoice Entry task to make any necessary changes. Reprint the invoices and perform the Invoice Printing update. Reprint the Sales Register, discarding any previous copies. When there are no more errors on the Sales Register, the update may be performed.

NOTE: Only invoices printed on-demand (with Invoice Entry) or printed in batch and updated (with Invoice Printing) are shown on the Sales Register.

Regular updating of the Sales Register is very important because of its effects on order processing, accounts receivable, and inventory control data. The results of the Sales Register update include:

NOTE: Only invoices printed on the Sales Register are affected by the Sales Register update.

Committing and Releasing Future Orders

When the Sales Order Entry task is accessed, a default shipping date is requested. A shipping date based on the Average Lead Time and maintained in the Order Processing Parameters maintenance task is suggested by the system. The entered shipping date becomes the default for the entire batch of orders.

A default commitment date is suggested by the system based on the # of Days/Commit into Future parameter. This date should be the same as or later than the default Shipping Date.

Stock that is not committed in order entry due to a future shipping date can be committed with the Commit and Release Future Orders task. This task commits all inventory scheduled for shipment before a selected date.

The Commit and Release Future Orders task should be run daily in most businesses. If order volume is low, or if the ship date for most items falls within the commitment window, the task may be run less often.

Running the Daily Detail Register

If the AddonSoftware General Ledger module is installed and the Post to General Ledger checkbox in the Application Maintenance task is marked in Order Processing Parameters maintenance, run the Daily Detail Register (in the General Ledger module) and update the general ledger with all Sales Order Processing and other transactions. Give all registers to your accounting department. The Daily Detail Register should be printed and updated daily.

Periodic Processing

In addition to your normal daily Sales Order Processing activities, certain functions need to be performed on a periodic basis. These periodic functions ensure that the proper reports and audit records are kept, that customer and pricing files are accurate and up to date, that files are cleared to provide additional disk space, that customer requests for pricing information are met on a timely basis, and that customer accounts are properly credited for returned or damaged goods.

Tracking Customer Sales by Job Numbers

If the Customer Job Numbers checkbox is marked in the Order Processing Parameter Maintenance task, you can track customer sales by job numbers. If you are a building materials supplier or other business that sells to contractors who purchase materials for multiple building sites, using this feature makes it possible to maintain separate sales records by job for each order/invoice processed. If you should need to file a lien against the property at a job site, all necessary historical information (job name and address, date of first shipment, total sales to date, date last invoiced, etc.) is immediately available.

Recording a Sale by Job Number

A Job Number field is available during order/invoice entry when this feature is operational. If this is a new job, the remaining information, such as job address and telephone number, can be added later with the Job Number Maintenance option of the Accounts Receivable Customers maintenance task. Customer job number information is stored in the Customer masterfile and may be recalled and/or maintained as needed. The job information, along with other Customer masterfile information, can be printed with the Hard Copy Printing option of the Accounts Receivable Customers maintenance task.

Quoting Customer Prices

Use the Price Quote Inquiry task to quickly supply your customers price information, an ideal feature for responding to telephone inquiries regarding pricing of specific items. This quick method uses information in the pricing tables and contract pricing files. Lookups are available for both customers and inventory items. Available quantities of items are displayed, as is any contract pricing if established for the customer.

Use the Sales Order Entry task to prepare printed price quotations for mailing to customers. If you receive a large volume of requests for pricing information, you may want to set aside a day a week or every two weeks to fill all requests at one time.

Maintaining Pricing Tables

The Pricing Table file should be reviewed periodically to check for items that may need updating. It may be necessary to add new items to the file, redefine the pricing method used for an item (mark-up from cost, mark-down from cost, margin over cost), or revise quantity break information.

Maintaining Contract Pricing

If you provide contract pricing to selected customers, it should reviewed periodically to verify that the information on file is accurate and up to date. It may be necessary to define contract pricing for additional items, revise the quantity break information, or extend a contract period so that a special price remains in effect for a longer time.

You may also want to create contract pricing records for new customers, or review the expiration date of contract prices already established. Since any contract pricing on file for a customer automatically supersedes the pricing tables during order/invoice entry, you will want to ensure that the Contract Pricing file is reviewed on a routine, periodic basis.

Processing Period End

Several reports are available to help you determine sales by your company. Taxes required due to the sales, as well as commissions owed, are also tracked. Use the following reports to view this information.

Sales Tax Report

Create the Sales Tax Report. This report lists taxable sales by month for each tax code used in Sales Order Processing. The report shows the tax percentage, taxable sales dollars, tax amount, and gross sales amount for the period specified. The report may be printed monthly, quarterly, or whenever sales tax reporting requirements dictate.

Sales Commission Report

All the information needed to prepare sales commission checks is provided on the Sales Commission Report. An individual commission statement is printed for each salesperson, showing each invoice sold by the salesperson during the period. The commission statement may be based on either booked or paid invoices, and on either gross sales or gross profits.

Monthly Sales Report

The Monthly Sales Report is a numerical listing of all updated sales invoices retained in the system. This report may be selected by date range to print a record of invoices for a specific period of time, such as a single month.

Monthly Sales Register

The Monthly Sales Register is available in detailed or summary format, this report shows each of the month’s general ledger postings generated by Sales Order Processing. A range of customers and invoice dates can be selected.

Invoice History Report

The Invoice History Report lists all or selected historical invoices. A customer number range, invoice date range, salesperson code, item number, and minimum gross profit percentage may be specified.

Customer/Job Report

If the Use Customer Job Number checkbox in the OP Parameter Maintenance task is marked the Customer Job Report can be created for a recap of customer sales itemized by job number. You may want to review this information periodically to check the status of outstanding payments and jobs in progress. For each customer, the report includes the customer number and name, job name, contact name, and the job description. Total dollar sales to date are shown by job, along with the preliminary lien number and date (if applicable), the first shipment date for the job site, and the date the customer was last invoiced for the job.

Processing Checklist

Daily Processing

Period-End Processing

Flow of Processing – Sales Order Processing

Overview