Sales Order Process

*Internet Marketing

Marketing Information Systems and the Sales Order Process

*Learning ObjectivesDescribe the unintegrated sales processes of Fitter Snacker , a fictitious company.Explain why unintegrated Sales and Marketing information systems lead to company-wide inefficiency, higher costs, lost profits, and customer dissatisfactionDiscuss sales and distribution in SAPs R/3 system, and explain how integrated data sharing increases company-wide efficiency

*Learning ObjectivesDescribe how SAP R/3 processes a standard sales orderDescribe the benefits of Customer Relationship Management software, a useful extension of ERP software

*Marketing Personnel make decision on:What products should we produce?How much of each product should we produce?How are our products best promoted and advertised?How should our products be distributed?What price should we charge?

*Problems with Fitter Snackers Sales process:Sources:Three unintegrated systemsSales Order SystemWarehouse SystemAccounting SystemManual handling of transactionsInformation not available in real time

*Fitter Snackers Sales Process

*Sales Quotations and OrdersSales callHand-written quote on 3 sheet form faxed to sales officeCustomer calls 800 number to place order

*Sales Quotations and Orders ProblemsSalesperson error in preparing quote manuallyCustomer call reaches sales office before faxed quoteFaxed copy is illegibleDelivery data requires call to warehouseWarehouse provides delivery date estimate

*Sales Quotations and Orders ProblemsInitial credit check uses paper processCredit check for established customers using accounting printout that may be a week old.

*Warehouse/Order FillingPacking lists/shipping labels manually sortedSmall order process and large order processInventory managed by Access database

*Warehouse/Order Filling ProblemsPicker may not report breaking case down for small orderPerishable product requires low inventoriesOut of stock decision:Partial shipmentChange production scheduleWait until full order can be shipped

*Accounting and InvoicingSales order data transferred by disk to PeachTree program 3 times per weekClerks must make manual adjustments for partial shipments and other errors.Invoices may not always match actual product shipped

*Payment and Returns ProblemsCustomers dont always include copy of invoice with paymentInvoice may not match payment-reconciliation requiredReturned Material Paper process, sometimes no RMA #Improper dunning letters

*Sales and Distribution with ERPSAP Sales and Distribution Process

*Pre-Sales ActivitiesInquiry or Quote (binding)Marketing ActivitiesTracking ContactsSales CallsVisitsMailings

*Sales Order ProcessingActivities required to record a sales orderIncorporate data from inquiry or quoteAutomated Pricing and DiscountingAutomate Credit Check

*Inventory SourcingCheck of inventory, orders and production to see if order can be delivered when customer desiresIncludes shipping and considers weekends/holidays

*DeliveryReleasing documents to warehouse to initiate pick, pack and shipSequenced and grouped for warehouse operation efficiencyMaterials Management module carries out picking, packing and shipping

*BillingSales order data copied to invoiceCan be printed and mailed, faxed or transmitted electronicallyAccounting records updated

*PaymentPayment may be physical check or electronicCash debited and customer account creditedQuick processing avoids credit check problems

*Sales Order Entry in SAP R/3Sold-to partyP.O. NumberRequired Delivery DateMaterialOrder Quantity

*Master DataMaster data is stored in a central database that is accessed by all modulesCustomer Master Data and Material Master Data are primary data sources for Sales Order Processing

*Organizational StructuresOrganizational structures allow the R/3 system to control the sales order process pricing, minimum orders, etc.Distribution Channel defines the way that materials move between the company and customersWholesale Distribution ChannelDirect Sales Channel

*Document Flow in SAP R/3All documents related tooriginal sales order

*Document FlowSales order process creates numerous documentsSales Order- Invoice- Delivery- Payment- Goods Issue- RMADocument Flow links all documents related to a sales order

*Discounts in SAP R/3

*Discount Pricing in SAP R/3R/3 system can be accommodate various discounting schemesCalculates correct discount based on customer and material

*Integration of Sales and AccountingSales order processing transactions make appropriate accounting entries at time of transaction-automatically

*Customer Relationship Management (CRM)ERP provides means to manage all data relating to a customer to improve the quality of the interactionCRM Activities include:One-to-One MarketingSales Force AutomationSales Campaign ManagementMarketing EncyclopediasCall Center Automation

*CRM BenefitsLower Costs due to better use of sales and marketing resourcesHigher Revenue by improving the effectiveness of marketing effortsImproved strategy and performance measurement by changing management and staff focus

*Chapter SummaryFitter Snackers unintegrated information systems lead to inefficiencies and reduced customer satisfactionAn ERP system like SAPs R/3 views sales as a process, providing timely, accurate data and automating error-prone tasks

*Chapter SummaryConfiguration decisions must be made during installation to match the companys practices and policiesThe ERP systems central database maintains master data used by all areas of the companyCRM software builds on ERP data to improve marketing effectiveness

*MRP allows plant manager to plan production and raw materials for many periods. It works backwards from a sales forecast to create a production schedule. From there, given supplier lead times and finished product recipes, MRP works backwards to schedule raw material purchases. This is impossible to figure w/o a computer.*MRP allows plant manager to plan production and raw materials for many periods. It works backwards from a sales forecast to create a production schedule. From there, given supplier lead times and finished product recipes, MRP works backwards to schedule raw material purchases. This is impossible to figure w/o a computer.*MRP allows plant manager to plan production and raw materials for many periods. It works backwards from a sales forecast to create a production schedule. From there, given supplier lead times and finished product recipes, MRP works backwards to schedule raw material purchases. This is impossible to figure w/o a computer.