Sales Order

# Sales Order Module

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The Sales Order module manages the complete sales order lifecycle from quotation to delivery, including order processing, shipment, and integration with inventory and accounts receivable.

Overview

The Sales Order module handles:

• Customer order entry and management
• Inventory allocation and reservation
• Order fulfillment and shipment
• Delivery tracking
• Integration with AR invoicing
• Sales analytics and reporting

Key Features

• Order Management - Create, modify, and track sales orders
• Inventory Integration - Real-time inventory allocation
• Pricing Management - Customer-specific and promotional pricing
• Credit Limit Control - Automatic credit checking
• Approval Workflows - Multi-level order approval
• Shipment Processing - Pick, pack, and ship
• Return Management - Sales returns and credit notes
• Gift/Promotion - Promotional items and gifts
• Analytics - Sales performance and trends

Module Structure

graph TD
    A[Sales Order] --> B[Master Data]
    A --> C[Transactions]
    A --> D[Reports]
    A --> E[Configuration]
    
    B --> B1[Customers]
    B --> B2[Price Lists]
    B --> B3[Credit Limits]
    B --> B4[Sales Persons]
    
    C --> C1[Sales Orders]
    C --> C2[Shipments]
    C --> C3[Returns]
    C --> C4[Deliveries]
    
    D --> D1[Order Reports]
    D --> D2[Shipment Reports]
    D --> D3[Sales Analysis]
    D --> D4[Customer Reports]
    
    E --> E1[Control Files]
    E --> E2[Workflows]
    E --> E3[Number Series]

Sales Order Process

Order-to-Cash Flow

sequenceDiagram
    participant Customer
    participant Sales
    participant Inventory
    participant Warehouse
    participant AR
    participant Finance
    
    Customer->>Sales: Place Order
    Sales->>Sales: Create Sales Order
    Sales->>Inventory: Check Stock
    Inventory->>Sales: Stock Available
    Sales->>Sales: Check Credit Limit
    
    alt Credit OK
        Sales->>Warehouse: Allocate Inventory
        Warehouse->>Warehouse: Pick Items
        Warehouse->>Warehouse: Pack Order
        Warehouse->>Sales: Create Shipment
        Sales->>AR: Generate Invoice
        AR->>Finance: Post to GL
        Sales->>Customer: Deliver Goods
        Customer->>AR: Make Payment
    else Credit Exceeded
        Sales->>Sales: Hold for Approval
    end

Order Status Flow

stateDiagram-v2 [*] --> Draft
    Draft --> Pending: Submit
    Pending --> Approved: Approve
    Pending --> Rejected: Reject
    Approved --> Allocated: Allocate Stock
    Allocated --> Shipped: Ship
    Shipped --> Invoiced: Create Invoice
    Invoiced --> Delivered: Delivery Complete
    Delivered --> [*]
    
    Rejected --> Draft: Revise
    Shipped --> Returned: Return
    Returned --> [*]

Creating a Sales Order

Step-by-Step Guide

Path: Sales Order > Sales Order > Transaction > Sales Order

1. Create New Order

   • Click Create New
   • Select Customer
   • Enter Order Date
   • Select Sales Person

2. Add Order Details

   • Click Add Line
   • Select Item Code
   • Enter Quantity
   • Verify Price (from price list or manual)
   • Add Discount if applicable
   • Specify Delivery Date

3. Review Order

   • Check Subtotal
   • Verify Tax Calculation
   • Review Total Amount
   • Check Credit Limit Warning (if any)

4. Save and Submit

   • Click Save
   • Add Notes if needed
   • Click Submit for Approval

Order Header Fields

Field	Description	Required
Customer	Customer account	Yes
Order Date	Date of order	Yes
Delivery Date	Requested delivery	Yes
Sales Person	Assigned sales rep	Yes
Payment Terms	Payment conditions	Yes
Currency	Transaction currency	Yes
Price List	Pricing reference	No
Ship-to Address	Delivery location	Yes
PO Customer	Customer's PO number	No

Order Detail Fields

Field	Description	Required
Item Code	Product/service	Yes
Description	Item description	Auto
Quantity	Ordered quantity	Yes
Unit	Unit of measure	Auto
Unit Price	Selling price	Auto/Manual
Discount %	Discount percentage	No
Tax	Applicable tax	Auto
Total	Line total	Calculated
Warehouse	Source location	Yes

Inventory Allocation

Allocation Process

flowchart TD
    A[Sales Order Created] --> B[Check Stock]
    B --> C{Stock Available?}
    C -->|Yes| D[Reserve Inventory]
    C -->|No| E[Backorder]
    D --> F[Generate Pick List]
    F --> G[Warehouse Pick]
    G --> H[Pack Order]
    H --> I[Create Shipment]
    E --> J[Notify Customer]
    J --> K[Wait for Stock]
    K --> B

Allocation Types

• Automatic - System allocates on order approval
• Manual - User manually allocates inventory
• Release Allocation - Release allocated stock

Path: Sales Order > Sales Order > Transaction > SO Allocation

Order Fulfillment

Shipment Creation

Path: Sales Order > Sales Order > Transaction > Sales Order Shipment

sequenceDiagram
    participant Order
    participant Shipment
    participant Inventory
    participant Document
    
    Order->>Shipment: Create Shipment
    Shipment->>Inventory: Issue Stock
    Inventory->>Inventory: Update Quantities
    Shipment->>Document: Generate Packing Slip
    Document->>Shipment: Print Document
    Shipment->>Order: Update Order Status

1. Select Order for shipment
2. Verify allocated items
3. Confirm quantities to ship
4. Generate packing slip
5. Issue inventory
6. Update order status
7. Create AR invoice (if configured)

Partial Shipments

Orders can be shipped in multiple deliveries:

• Track shipped vs. ordered quantities
• Maintain backorder status
• Generate multiple invoices

Pricing Management

Price List Hierarchy

graph TD
    A[Pricing] --> B[Base Price List]
    A --> C[Customer Price List]
    A --> D[Promotional Price]
    A --> E[Manual Override]
    
    B --> F[Item Master Price]
    C --> G[Customer Specific]
    D --> H[Time-limited Offer]
    E --> I[Sales Approval Required]

Price Determination

Priority order:

1. Manual price (with approval)
2. Promotional price (if active)
3. Customer-specific price list
4. Default price list
5. Item master price

Path: Sales Order > Pricelist > Transaction > Price List Master

Credit Limit Management

Credit Check Process

flowchart LR
    A[Enter Order] --> B[Calculate Total]
    B --> C{Check Credit Limit}
    C -->|Within Limit| D[Proceed]
    C -->|Exceeds Limit| E[Warning]
    E --> F{Override Permission?}
    F -->|Yes| G[Manager Approval]
    F -->|No| H[Hold Order]
    G --> D

Credit Limit Settings

Path: Master Data > Address Taxes > Credit Limit Customer

• Credit Limit Amount - Maximum allowed
• Current Balance - Outstanding AR
• Available Credit - Limit - Balance
• Grace Period - Days allowed over limit
• Exceptions - Special approvals

Sales Returns

Return Process

Path: Sales Order > Sales Order > Transaction > Sales Order Return

sequenceDiagram
    participant Customer
    participant Sales
    participant Warehouse
    participant Inventory
    participant AR
    
    Customer->>Sales: Request Return
    Sales->>Sales: Create Return Order
    Customer->>Warehouse: Return Goods
    Warehouse->>Warehouse: Inspect Items
    
    alt Items OK
        Warehouse->>Inventory: Receive to Stock
        Inventory->>AR: Create Credit Note
        AR->>Customer: Issue Credit
    else Items Damaged
        Warehouse->>Inventory: Receive as Damaged
        Sales->>Customer: Partial Credit
    end

Return Reasons

• Damaged - Product defective
• Wrong Item - Incorrect item shipped
• Excess Quantity - Over-shipped
• Customer Request - Change of mind
• Quality Issue - Does not meet specs

Reports & Analytics

Standard Reports

Report	Purpose
Sales Order Report	Order details and status
Shipment Report	Shipment tracking
Outstanding Orders	Backlog analysis
Sales by Customer	Customer analysis
Sales by Item	Product performance
Sales by Salesperson	Rep performance
Order Recapitulation	Order summary

Smart Reports

Interactive dashboards for:

• Sales trends and forecasting
• Customer analysis
• Product performance
• Salesperson metrics
• Regional analysis

Path: Smart Report > SO Smart Report

graph LR
    A[Smart Report] --> B[Sales Dashboard]
    B --> C[Charts]
    B --> D[Trends]
    B --> E[KPIs]
    
    C --> C1[Sales by Month]
    C --> C2[Top Customers]
    C --> C3[Top Products]
    
    D --> D1[Year over Year]
    D --> D2[Month over Month]
    
    E --> E1[Order Count]
    E --> E2[Average Order Value]
    E --> E3[Fulfillment Rate]

Advanced Features

Gift and Promotion

Path: Sales Order > Sales Order > Transaction > SO Gift

• Add promotional items
• Free goods with purchase
• Special offers
• Gift tracking and reporting

Target Achievement

Path: Sales Order > Target Achievement > Transaction

• Set sales targets by:
  • Salesperson
  • Customer
  • Item/Product group
  • Period
• Track actual vs. target
• Achievement reports

Customer PO Management

Path: Sales Order > Sales Order > Transaction > PO Customer

• Link to customer's purchase order
• Track PO status
• PO-based reporting

Integration

With Other Modules

graph LR
    SO[Sales Order] -->|Allocation| INV[Inventory]
    SO -->|Shipment| DEL[Delivery]
    SO -->|Invoice| AR[AR Module]
    SO -->|Pricing| PL[Price List]
    
    INV -->|Stock Check| SO
    AR -->|Credit Limit| SO
    CM[Cash Management] -->|Payment| AR
    GL[General Ledger] <--> AR

Posting to GL

When shipment occurs:

Debit: Accounts Receivable
Credit: Sales Revenue

Debit: Cost of Goods Sold
Credit: Inventory

Best Practices

Order Entry

[OK] DO:

• Verify customer information
• Check stock availability
• Confirm pricing and discounts
• Review credit limit
• Add clear notes/instructions

[OK] DON'T:

• Skip credit checks
• Override prices without approval
• Ship without allocation
• Ignore backorder warnings

Fulfillment

[OK] DO:

• Verify picked quantities
• Check item condition
• Use proper packaging
• Generate all documents
• Update tracking information

Returns

[OK] DO:

• Document return reason
• Inspect returned goods
• Update inventory properly
• Process credit promptly
• Analyze return patterns

Troubleshooting

Common Issues

Cannot Save Order

• [OK] Check required fields completed
• [OK] Verify customer is active
• [OK] Check items are active
• [OK] Review validation messages

Credit Limit Exceeded

• [OK] Review customer's AR balance
• [OK] Check payment history
• [OK] Request credit limit increase
• [OK] Seek management approval

Stock Not Available

• [OK] Check inventory quantities
• [OK] Review allocations
• [OK] Consider alternative items
• [OK] Set backorder

Price Not Loading

• [OK] Verify price list assigned
• [OK] Check item in price list
• [OK] Review effective dates
• [OK] Check currency match

Key Performance Indicators

Sales Metrics

• Order Fill Rate - % orders filled completely
• On-time Delivery - % delivered on promised date
• Average Order Value - Total sales / order count
• Order Cycle Time - Order to delivery time
• Return Rate - Returns / total orders

Monitoring Tools

graph TD
    A[KPI Dashboard] --> B[Daily Sales]
    A --> C[Order Backlog]
    A --> D[Fulfillment Rate]
    A --> E[Return Rate]
    
    B --> F[Trend Analysis]
    C --> G[Action Items]
    D --> H[Process Improvement]
    E --> I[Quality Review]

Summary

The Sales Order module provides:

• [OK] Complete order lifecycle management
• [OK] Real-time inventory integration
• [OK] Flexible pricing options
• [OK] Credit control and risk management
• [OK] Efficient fulfillment processes
• [OK] Comprehensive reporting and analytics

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Related Documentation:

• Delivery Management
• Price Lists
• Inventory Module
• AR Module

Last Updated: January 2026