PO Generator by Order
Automates back order Purchase Order process
Last updated
Automates back order Purchase Order process
Last updated
The purpose of the Purchase Order Generator by Order (POGo) is to provide decision support and automation for backorders, i.e. the purchase of stock to fulfill orders to which stock cannot be allocated at the time of receiving a customer purchase order.
The POGo automates the bulk creation of Purchase Orders by Item, by Supplier. The POGo can be used to detect and report which Items on which Sales Orders cannot be allocated. See Using Stock Allocation.
The POGo displays by Item and grouped by Supplier the aggregated and exact quantity of Items that need to be ordered to fulfill unallocated orders.
You can agree with or adjust the ‘To Order’ result, and then generate the Purchase Orders. You might do the adjustment to meet Supplier minimum order requirements or to acquire more free stock.
When you generate Purchase Orders with the POGo, the system creates a two-way linkage between the Sales and Purchase Orders.
If as a result of the POGo action there are one to many relationships between the Purchase Order and the Sales Orders, the system will insert a link labeled ‘Split’ into the ‘Sales Order’ field on the generated Purchase Order. When you click this link, a modal box (pop-out window) will display the corresponding list of Sales Orders.
If the POGo action results in a one to one relationship between the Purchase Order and a Sales Order, the system will insert a direct link into the ‘Sales Order’ field on the Purchase Order. The link will contain the Ref# of the Sales Order.
On the Transactions tab of the Sales Orders selected in the POGo ‘Generate POs’ action, the respective Purchase Orders together with individual ‘Status’ will be listed. To see ETA information at the Document and Line Item level, you’ll need to open and view the respective Purchase Order.
The mechanism and the algorithm (calculation method) can be adapted to your specific inventory optimization1 requirements. We can create custom scripts to calculate and automate. Contact support@salesorder.com for guidance.
1Inventory optimization is a method of balancing capital investment constraints or objectives and service-level goals over a large assortment of stock-keeping units (SKUs) while taking demand and supply volatility into account.
Implemented effectively Inventory optimization can significantly increase the availability of your working capital, and reduce the amount of redundant stock.
The Purchase Order Generation by Order workflow has four stages:
Search and select the Sales Order(s) to be fulfilled.
Select the Items to be put on Purchase Orders (backorders)
Adjustment of ‘To Order’ quantity.
Generate Purchase Orders.
Purchasing>Purchase Order Generator by Order>Search
Use the filters to focus your search. If you need to search by Order Priority, set the filter on the Advanced Search tab. Remember, you can memorize searches. See ‘Using memorize search on Lists’.
The system will return a list of Sales Orders which require stock. The two columns to note are ‘Date’, the date the order was entered, and ‘Required Date’, the date the customer stipulated for delivery.
Use the checkbox on the left-hand side of each order to select the Order. When you select a Sales Order the POGo will begin building a display of what quantity of each Item ‘to order’ in the following structure.
| Column | Description |
|---|---|
Item Code | The SKU |
Description | SKU description |
Supplier | The default preferred Supplier for this Item. |
Site | The selected site to which the results in this row relate. |
Qty | The quantity of this Item required to fulfill all of the selected Sales Orders. |
Qty (NA) | The quantity on Sales Orders that are not allocated. |
Qty on PO | The quantity of this Item on current Purchase Orders that have not been received. |
Item MOQ | The minimum order quantity for this Item. This is manually entered on the preferred supplier table against the respective Item. |
Cost* | The Item cost, either inherited from the Unit cost on the Item, or from the preferred Supplier table on the Item. This can be preset on the Purchase Order configuration. |
Amount* | The sum of the ‘Qty to Order’ and the Cost (above). |
MOV | This is not directly used in the POGo’s calculations. The minimum order value. It just indicates a threshold and is for reference. This is manually set in the ‘Ordering’ section on the ‘Profile’ tab of the Supplier master. The value is in the Supplier’s trading currency. |
MOQ | This is not directly used in the POGo’s calculations. The minimum order quantity. This is NOT the Item MOQ. It just indicates a threshold and is for reference. Use it if your supplier stipulates an overall number of pieces regardless of SKU. This setting is manually set in the ‘Ordering’ section on the ‘Profile’ tab of the Supplier master. The value is in the Supplier’s trading currency. |
Qty to Order | When the Purchase Orders are generated, this value is used to stipulate the quantity of Items to order. You can edit and adjust this field. Displays the result of the POGo’s calculation (see below). |
*These values are in the respective Supplier’s trading currency if derived from the preferred Supplier table. If they’re derived from the Item ‘Unit cost’ they are in the General Ledger base currency.
The search action returns the ‘To Order’ quantities. These values are derived this calculation:
Qty (NA): Quantity (Not Allocated), the shortage on selected Sales Orders
- (Minus)
Qty on POs: Quantity on Purchase Orders
+
Quantity of Items required to restore the Reorder Level to the preset balance.
+
Quantity of Items required to meet the Item MOQ.
Notice the search result returns the list of Items grouped by Supplier with a Totals rows which display the sums of the Amount(s) and the ‘Qty to Order’. If the MOV and MOQ fields on the Supplier master contain a value, it will be displayed in this row.
Agree with or adjust (edit)the ‘Qty to Order’ per Item.
Use the checkbox in the left-hand column of each row to select the Items for which you need to generate Purchase Orders. Click the Action ‘Generate POs’. The system will return the ‘Created Purchase Orders’ List.
The ‘Site’ on the created Purchase Orders will inherit from the Site set on your search. This will be where the Purchase Orders will be available for receiving.
