Order Promising: Sales Delivery and Shipping Dates

Meeting your customers’ expectations of delivery times is paramount to delivering a quality service to them. We have all experienced the chaos and confusion caused when un-realistic dates are promised to the Customer. The realistic Sales Shipment & Delivery Date can only really be accurately determined from the ERP inventory data in Business Central. Let’s review how we can use the standard functionality in Business Central to avoid the chaos.

Once you have created a Sales Order in Business Central either manually or from Dynamics CRM, the system calculates the Shipment and Delivery dates that you need to convey to your customer. 

Customer has a Requested Delivery Date

If the Customer has communicated a Requested Delivery Date, then this is used as the starting date to calculate backwards:

  • Requested Delivery Date – Shipping Time = Planned Shipment Date
  • Planned Shipment Date – Outbound Whse. Handling Time = Shipment Date

Now, if the stock is available to pick from the warehouse on the Shipment Date, then the sales process can proceed as normal. However, if the stock is not available on the Shipment Date (Note the system includes incoming inventory, typically from Purchase Orders etc.), then the system generates a Stock-out Warning.

No Requested Delivery Date

If no Requested Delivery Date is entered, the system then calculates the dates on the S/O line start from today and calculates the date forward.

  • Shipment Date + Outbound Whse. Handling Time = Planned Shipment Date
  • Planned Shipment Date + Shipping Time = Planned Delivery Date

Now, if the stock is available to pick from the warehouse on the Shipment Date i.e today, then the sales process can proceed as normal. However, if the stock is not available on the shipment date, then the system generates a Stock-out Warning.

If you have ample stock at your location (No available inventory warning), then establishing the Sales Line Delivery & Shipment Date is straightforward as per above. The real business challenge, therefore, is when you don’t have sufficient stock to ship the good on the Shipment Date. So, how do we get realistic dates for our Customers? Business Central has two functions within its Order Promising to assist in this calculation.

Available to Promise

This process calculates the earliest date that the item will be available with respect to inventory availability of unreserved quantities and incoming orders for the item. These orders are:

  • Purchase Order
  • Production Orders
  • Assembly Order
  • Transfer Orders

It may be that stock is available currently but not the required amount and that more is incoming. Where this is the case, both the current stock and the expected receipts will be considered for any sales orders made.

Capable to Promise

This feature is used where current unreserved inventory and incoming orders is still not sufficient to cover the demand on the Sales Order line. If the item is presently out of stock, you can calculate the Earliest Shipment Date the item can be available by considering the following:

  • Purchase from a Vendor
  • Manufacture with a Production Order
  • Assemble with an Assembly Order

As ATP & CTP calculate dates differently, ATP & CTP can return different Earliest Shipment Date & Planned Delivery Date results! Again, it is vital that your sales process recognises this, and the salespeople know which option to choose. Available to promise will not work where there’s no available or incoming stock within the ‘Check Availability Period’. Contrarily, where there’s no planned incoming stock and you are using Capable to Promise, it will still provide an Earliest Shipment Date. This will be based on creating a new order and the time taken to start that process of getting the goods, organising them appropriately and then shipping them.

Using Order Promising

After generating the Earliest Shipment Date, you can select the ‘Accept’ button within ‘Order Promising’ to accept the suggested Earliest Shipment Date. This updates the Shipment Date back on the Sales Order Line and recalculates the other dates accordingly. Additionally, the system creates Planning Lines in the Planning Worksheet, corresponding to the additional supply requirements from Order Promising. In reality these are:

  • Suggested purchase lines for items with a Replenishment System of Purchase
  • Suggested Production Orders lines for items with a Replenishment System of Prod. Order
  • Suggested Assembly Orders lines for items with a Replenishment System of Assembly

Order Promising for assembled and manufactured items can also produce complexity. This occurs where the key consideration is “have we got sufficient components to build the parent item”. You can configure Order Promising to include components in the Order Promising Calculation.

When analysing the Sales Line from a shortage point of view, it is also worth noting that for manufactured and assembled Items, the ‘Item Availably by BOM Level’ also give useful insight into inventory availability.

Closing remarks

Order Promising is a very powerful tool that businesses can use to establish realistic shipment delivery dates. These can be shared with the customer, which can potentially win your business over your competitors.  However, to achieve this, it is critical to build these Order Promising functions into your Sales Order processing routine. Our more recent posts on order promising give a guide and a demonstration of the functionality in action. Make sure to read part one on order promising. Finally, if you have any comments or queries, make sure to contact us.

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