The first challenge is to provide a single, centralized database of registered outlets (customer) and integrate it with sales order management to get real-time information of effective call by salesman and branch. Security on the centralized database must be defined as such so that each branch can access only customers from that particular branch.
The second challenge is to develop a comprehensive and flexible sales price & discount management with the following features:
- Price and Discount by Unit of measurement
- Seasonal Discount
- Quantity Discount in % or amount
- Mixed-item bonus and discount
- Multiple level discount
The third challenge is to find an ERP software to automate the current sales order process without down-time. The ERP in question must support one-bill system feature (in which only one outstanding invoice for each customer is tolerated in the credit control). Credit limit and Credit Exception Audit Trail are also required in the Sales Order Process to enable easy credit approval process for orders to be shipped each day. The order processing cycle, from receiving orders from customers, checking available stock, credit approval, order fulfillment, right through sales invoice generation, must be processed quickly and redundant data entry minimized.
Sales order processing also requires a feature to help collectors easily manage daily collection, including collection status monitoring of every invoice and customer’s post-dated checks tracking.
Since direct shipments from supplier’s warehouse to customer’s make up a significant volume, there should be a function that automatically connects and updates order entry, shipments, warehouse receipt and accounts payable.
Meanwhile, with warehouses spread in many cities, it is essential to manage inter-city order fulfillments. A warehouse in one city may order and receive replenishments from one in another city and everything is kept track on-line.
The fourth challenge is inventory management. Close monitoring of expiration date is necessary to maintain product quality. Inventory transfer among disparate warehouses must be controllable centrally from HQ and its status must be easily monitored.
The fifth challenge is centralized procurement and AP payment. A Purchase Order is issued from HQ to a supplier with orders to ship directly to various branches and depots, and then billed back to HQ. Billing verification and payment to supplier invoice is then handled at HQ.
The last challenge is centralized accounting. All transactions in branches must generate automatic journals for accounting purposes at HQ. The accounting department can then easily generate Balance Sheet and Income Statement by branch, as well contribution margin by salesman.
PROSIA, an Orlansoft partner with extensive experience in distribution business, successfully helped SND team to implement Phase 1 of Orlansoft project within 2 months.
Orlansoft Sales and Account Receivables went live for operations in Jatim I, Jatim II, and IBT branches, Madiun, Kediri, Malang, and Madura depots on May 2, 2008 (1 month after project kick off) and were immediately followed by Medan, Bekasi, Bandung and Semarang branches on the second month (including Pekanbaru and Cirebon depots).
The main achievement of Phase 1 was the integration of in sales order management (including credit approval process), order fulfillment, sales invoicing, Account Receivables monitoring, AR collection and post-dated check tracking in all branches and depots into a single system and replaced a fragmented, redundant entry operation in a legacy system.
Orlansoft Sales Price Management made it possible to apply complex marketing program (e.g. buy 10 cartons of items A+B+C and get additional discounts or free item A) in all branches in record time.
Orlansoft Master Data Management enabled easy access setting and management to customer information in each branch while reserving new customer registration at HQ, and keeping it all in one single database.
After the success in Phase I, implementation continued to Phase 2, in which Distribution and Financials modules of Orlansoft Core_Enterprise took on Order to Cash, Purchase to Pay, Treasury and Accounting business process at Head Office and Jatim I branch (including Kediri and Madiun depot) Phase-2, which had been originally expected to last 4-5 months, was completed successfully in 3 months' time and went live on September 1, 2008
Orlansoft “drop shipment” feature sped up order fulfillment processing for orders requiring direct shipments from principal’s warehouse to customer site, by generating appropriate automatic purchase order and purchase receipt.
For transfers among the company’s warehouses, the Orlansoft Replenishment Order feature helped a lot in organizing centralized transfer requests and status monitoring both at the head office and the branches.
Orlansoft Inventory Management made it easy to track batch numbers and expired dates of inventories in branches and depots. It also enabled the company to make use a feature in which shipments would automatically propose items with the oldest expired date first.
Orlansoft Inter-Entity Settlement made it possible for the head office to implement centralized issuance of Purchase Orders to Principals for better inventory planning. It also supported centralized payments to Accounts Payable, and at the same time facilitated cash-flow management by generating Balance Sheet and Income Statement for each branches.
Orlansoft Tax Management provided support for supplier Tax Invoice registration and generate both Standard and Simple Sales Tax Invoice#
The success in Phase-2 inspired the team to continue the Phase-3 implementation for Jatim II, IBT, Medan, Bekasi, Bandung and Semarang branches.