Chapter 9: Sales
There are a couple of factors that contribute to the saleability of Spindl's products—innovation, sustainability, and comparatively low costs. There is something about it that is inherently human. No software can really change the core of what the company’s products offer. What it can do, however, is equip employees to dedicate their energies toward what matters by helping them deal with the technicalities of sales operations. Because at the end of the day, the driving force behind the company’s survivability is profit.
Using ERP, Lyn is able to construct a structured pipeline that Spindl's employees can use to manage their business interactions with all their customers. While presales (gathering leads, opportunities, emailing, etc.) fall under the Customer Relationship Management (or ‘CRM’) module, the active selling—quotations, orders, deliveries—is covered using the Selling module.
Why use ERP for sales?
As a business, your bread and butter are selling, be it a product or a service. The process of how you may go about it may differ slightly from other businesses, yet the end goal is largely universal—get more people to purchase what you have to offer. With that in mind, an ERP can assist you in implementing and following some universally recognized best sales practices. This includes efficiently tracking all communication with your customers and also integrating with other modules such as CRM, Accounting, and Inventory.
Breaking down the workflow
As with the previous modules, we’ll quickly go over some key elements of any ERP’s Selling module.
A customer (otherwise known as a client, buyer, or purchaser) is the entity (individual or organization) who receives goods or services from a seller, generally through a monetary transaction. In ERP, any entity that makes such a transaction with your business is stored in a database of customers.
A quotation is a document containing the estimated pricing quotes and other terms of engagement (e.g., taxes, T&C) for what the buyer is looking to purchase. These are usually valid for a limited amount of time, depending on the business’ discretion. This is also known as a ‘proposal’, ‘estimate’, or a ‘pro forma invoice’.
A sales order is the confirmation of a quotation, signifying both parties’ agreement to a monetary transaction. Any deviations from the quotation (change in price, for example) should be settled on before submitting a sales order.
A blanket order is an order from a customer to supply materials for specific items over a given period of time at a pre-negotiated rate. A blanket order can be used to generate sales orders as per the delivery schedule.
Any entity (individual or company) that assists you in getting business is a sales partner. They are otherwise called channel partners, distributors, dealers, agents, retailers, resellers, etc. Usually, sales partners have a specific commission rate (which you can define within the ERP). When a sales partner is selected in transactions, their commission is automatically calculated for the net total of the transaction.
Setting up a selling workflow
The sales team at Spindl, after completing their trials and assessments, begin using the following sales workflow:
- All existing customers are entered into the system. This gives the salespeople a comprehensive database of details for each customer. Information such as tax ids, account managers, accounting details, territory, etc. Are all added.
- A list of sales partners (along with their commission details) is also uploaded to the system. This eliminates the need to manually enter information for these sales partners in future transactions.
- Whenever an opportunity (see: CRM module) comes to fruition, a quotation is sent to the customer. The quotation includes all proposed details of the transaction (i.e. Quantity, pricing, tax details, discounts, fulfillment date, etc.).
- Once the quotation is approved by the customer, it is converted into a sales order. This acts as a confirmation from the buyer that they are ready to purchase the clothing from Spindl.
In the case of a blanket order being placed, details about the expectations are entered and saved. This includes the validity period, item quantities, and prices. If there are any other terms & conditions, those are also mentioned. Sales orders are generated using the blanket order based on the delivery cycle.