The Sales Order Process

The Sales Order process is part of the Order to Cash and wider Quote to Cash process. Whilst the principles of these processes are clear, actual processes will vary significantly as they are fundamentally linked to the nature, priorities and circumstance of a business, their market and operations. The B2C world is increasingly fully digitised, online, real-time and automated. The B2B world is less so – often manual and will involve unstructured data in proposals and contracts. Still the basic principles in a sales order process are same and the typical steps are:

  • 1

    As part of pre-sales activities, the customer receives a sales proposal or estimate for a product or service.

  • 2

    Depending on the type of business, orders can also be received via different channels including Email, Telephone, EDI or online, Fax etc. They may also include a Purchase Order especially in the B2B world.

  • 3

    When customer accepts the price or proposal by signing contractual terms of service and other agreements such as GDPR or NDA, it becomes a sales order and the sales order management process starts.

  • 4

    Once a signed contract or order is received, an order validated and checked, any supporting documentation is checked where relevant, stock or resource is allocated (if relevant).

  • 5

    This process is either completed in the finance or ERP system or it is completed by a separate order management process and imported into the system. Many B2B operations are still manually processing even paper-based sales orders.

  • 6

    Once complete a Sales Order confirmation is sent to the customer confirming specific details of the products, price, terms and delivery dates, billing/shipping address. Often multiple notifications will be sent to keep the customer informed of the delivery or implementation progress.

  • 7

    The Sales Order is also often used to initiate other internal processes and systems updating such as order delivery, service delivery and invoicing/ Accounts receivable process.

  • 8

    Whilst many businesses use slightly different approaches depending on their business. A sales order is a single and universally accepted mechanism for reflecting what has been ordered and what will be produced and delivered.

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