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Marketing Information Systems and the Sales Order Process
customer (which does not always happen when things are busy) and the Accounting
Department so they can change the invoice.
Accounting and Invoicing
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Invoicing the customer is problematic as well. First, the data from the current order-entry
system is only loaded into the accounting system at the end of each day, so the
Accounting Department does not have information on new sales orders until the following
day. In addition, clerks must manually make adjustments in both the order-entry system
and the accounting system for partial shipments and for any other changes that have
occurred during the order-fulfillment process. Many times these corrections are not made
in both systems, causing discrepancies that must be corrected at the end of the month, at
which point it is more difficult for the parties involved to remember what happened.
Delayed order corrections also sometimes result in late or inaccurate invoices. If the
completed invoice is waiting to be mailed when the warehouse notifies Accounting of a
partial shipment, then a new invoice must be prepared. In any case, an invoice is
eventually sent to the customer, separate from the shipment.

Payment and Returns
Fitter’s procedure for processing payments often yields frustrating results for customers.
Almost all customers pay the invoice within 10 days to receive the 2 percent discount. If any
errors have occurred in the sales or order-fulfillment process—from the original quotation to
entering the order into the sales order program to filling the order in the warehouse—the
customer will receive an incorrect invoice. Even though Fitter provides customers with two
invoice copies, many customers do not return a copy of the invoice with their payment, as
instructed. Errors sometimes result in the incorrect customer’s account being credited.
Fitter’s returns processing is also flawed. Because Fitter’s snack bars contain no
preservatives, they have a relatively short shelf life. Thus, the company has a policy of
crediting customer accounts for returned snack bars that have exceeded their “sell by”
date (this is a generous policy, because it is impossible to know who—Fitter or the
customer—is responsible for the bars not selling before they expire). Fitter also gives
credit for damaged or defective cases returned by customers. Customers are supposed to
call Fitter to get a returned material authorization (RMA) number to simplify the crediting
process. When cases are returned to Fitter, the Receiving Department completes a
handwritten returned material sheet, listing the returning customer’s name, the materials
returned, and the RMA number. However, many customers do not call for the RMA
number, or fail to include it with their returned material, which makes it more difficult for
the Accounting Department to credit the appropriate account. Poor penmanship on the
returned material sheet also creates problems for Accounting.
When an account becomes past due, Fitter sends a dunning letter, which is the term
for a letter notifying a customer that their account is past due and requesting payment if
payment has not already been sent. As the account gets more delinquent, the dunning
letters usually get more direct and threatening. If a customer’s account has not been
properly credited, however, the customer may receive a dunning letter in error, or may
receive a call about exceeding their credit limit after placing a new order. Such situations
damage goodwill with both new and repeat customers.
In the following sections, you will learn how an ERP system could improve the sales
process for Fitter Snacker.

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