Order to cash business processes

Dynamics 365 Supply Chain Management allows you to manage the lifecycle of customer orders effectively. The order to cash process can begin with a sales quote, sales agreement, or sales order.

The graphic below illustrates the order to cash process at a high level.

Customers and products are necessary data for the order to cash process. Sales lines cannot be generated without products and sales header’s cannot be made without customers. Once this data is created it will remain set and rarely need to be updated. For more information on creating products, visit Manage products

Let’s walk through an example. Suppose that Contoso Electronics manages their order lifecycle in Dynamics 365 Supply Chain Management, selling TV equipment and accessories to their customers.

1. Customer Management

   • Jane Doe calls Contoso regarding their selection of electronics. Jane has never purchased items with Contoso before, so she is not an existing customer. The customer service representative at Contoso sees an opportunity to gain a new customer. He inputs Jane as a prospect, a potential customer, in the system.

2. Sales Quotation

   • Jane has questions regarding pricing for a large order of electronics. A sales representative creates a sales quotation based on her inquiry.

3. Sales Order

   • After seeing the sales quotation, Jane decides to move forward with Contoso. A sales representative from Contoso converts her from a prospect to a customer. The sales quotation is confirmed, generating a sales order with the same lines and header.

   • Since Jane is a first-time customer at Contoso, she receives 10% off her first order.

   • The Sales Operation team confirms pricing and discounts based on predefined rules and agreements

4. Sales Order processing

   • A member from the order management team verifies Jane Doe's information.

   • Inventory availability is confirmed.

   • The Customer Service team might follow up with the customer for special requests, delivery preferences, or any changes to an order.

5. Order fulfillment

   • Dynamics 365 Supply Chain Management provides tools for managing warehouse operations, including picking routes, packing strategies, and shipping carrier integration.

   • Contoso’s warehouse team picks each item from inventory, packs it, and gets it ready for shipment. A shipping label is printed. The order is then given to Contoso’s shipping provider.

6. Invoicing

   • The Accounts Receivable team at Contoso creates the invoice from details of the sales order, shipment, and customer payment.

   • They send Jane the invoice. It includes details about her items and pricing, taxes, shipping charges, and payment terms.

     • In Dynamics 365, the system can generate invoices automatically based on predefined billing rules, or the accounts receivable team can create them manually.

7. Customer Payment

   • Janes uses her preferred method of payment, a credit card, to pay for her order.

     • Dynamics 365 supports various payment methods, including credit card processing, bank transfers, and check payments.

     • The Accounts Receivable team from Contoso can record and track payment information in the system.