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Ch 12: Revenue cycle (Key decisions (Product customization, Amount and…

- - - - It recorded in a sales order document
        Sales order document contain information about (Product number , quantity , price , salesperson's ID)
      - To improve taking customer order process:
        1- Send orders directly to the warehouse to pick and ship
        2- use electronic data interchange (EDI) to take orders
        3- Automate price change\promotion notifications
        4- Use sales history to customize encouragement
        5- choice boards to customize orders
        6- handhelds in the field
    - - Approve credit after checking history:
        1- General authorization - regular business (every time sales happens they authorize the check)
        2- Specific authorization - new customers (buy now pay later)
      - To improve performing credit check process:
        1- Automate credit limit and A/R balance checking
        2- Emails the credit manager for special authorization
    - - Step 1: Check quantity
        1- On hand
        2- Already committed
        3- On current order
      - Step 2: Check unit availability
        1- yes, complete the sales order
        2- No, initiate a back order
      - Step 3: making sure of the accuracy
        1- careful shipping/sales data entry
        2- Not running similar items through scanned (pepsi & 7up)
        3- Entering return items in the system
    - - 1- Customer Relationship Management (CRM) help organize info. about customers to be more personalized.
        2- Provide data about customer needs and business practice.
      - To improve respond to the customer inquiries
        1- Automatic update of A/R
        2- Customized coupons (take a coupon for something i buy a lot)
        3- FAQs and balance inquiries
        4- Order status update (track shipping)
        5- Tracking customer requests and complaints
  - - - Picking and Packing the order
      - Shipping the order
    - - Compares quantities/items picked with order
      - Initiates back order as needed
      - Records Shipment
        
        FOB - Shipping point , buyer
        
        FOB - Destination , seller
      - Prepares Shipment Documents
        
        Packing ship
        
        Bill of lading
        
        Freight bill
    - - Deliver
        
        Positive
        Take control of the service
        Ensure quality
        
        Negative
        Two separate business
      - Outsource
    - - Location: where you keep some inventory
        Amount of inventory to carry
  - - - Accurate, and timely
      - Items, quantity, price, and terms
      - Cost and time can be saved if done electronically.
    - - Debit A/R when goods are shipped
        Credit A/R when payment are received
        Open-invoice: pay per invoice
        Balance forward: Pay per monthly statement
      - Use of IT
        Storage of digital image of payment
      - Advantages
        
        Instant retrieval & transmission: anybody can access the bill anywhere
        
        Multiple people can view at once
        
        Reduce storage space
      - Exceptions
        
        Return
        
        Allowances for damaged goods: keep the item by offering discount
        
        Write off uncollectible, customers don't pay
        
        A/R not reasonable for deciding whether they stop sending bills for uncollectible company