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174 CHAPTER 5 The Fulfi llment Process

Figure 5-55: Example of standard analysis

CHAPTER SUMMARY

The fulfi llment process involves the activities required to receive and respond to
a customer inquiry, process a sales order, ship goods, and bill and receive pay-
ment from customers. A company’s fulfi llment process is typically optimized
for the type of goods it sells and the sales channels (wholesale or retail) that
it utilizes. The fulfi llment process is the lifeblood of any company due to its
clear focus on generating revenues and driving requirements for many other
processes such as production and purchasing. In addition, the company must
make certain that all revenues resulting from the fulfi llment process are prop-
erly refl ected in the fi nancial statements and that billing and receiving payments
from customers are carried out effi ciently.
The fulfi llment process consists of fi ve key steps: (1) receipt of a cus-
tomer inquiry or RFQ, (2) preparation of a quotation in response to the inquiry,
(3) sales order processing, (4) shipping, and (5) billing and payment processing.
Many types of data are required to execute these steps properly and to account
for the goods and fi nancial impact of the fulfi llment process.
Sales area, shipping point, and credit control area are categories of
organi zational data that are unique to the fulfi llment process. A sales area is a
combination of three additional organizational data: sales organization, distri-
bution channel, and division. The confi guration of these data for each company
is a refl ection of the industry, the product, and any customer requirements that
a company must meet.

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