What are Sales Order and its application?
SO is the short form of the sales order. And it is an order issued by a business to the customer. This order specifies the information about products and services ordered by a specific customer along with the price, quantity and terms and conditions. Businesses use it as a confirmation document that is with the customers before delivery of goods and services.
In practice, the following steps which businesses use are as follows:- :
- The potential customer always receives an estimate.
- If accepts, the customer sends a purchase order (PO).
- Customers may request this Order to view exact details of the products, price, terms and delivery dates.
- When products are ready to deliver, the formation of an invoice takes place from SO for billing purposes.
Once the Sales Order is created, the Inventory manager can look at it to know what needs to be delivered/shipped and when. Please examine the image below to understand how Sales Orders work.
How to create Sales Order
Login into your account and open ‘Sales Orders’ from the ‘Income’ menu. You will get a list of SO. Click on the tabs to see Executed, Draft and Cancelled sales orders as shown below.
Click on the ‘+ New Sales Order’ button and add the following details:
- Customer Name – Select from an existing list or create a new one
- Date of Sales Order
- Product Name, description, quantity, unit cost, discount & tax and you can add more items by clicking on ‘+ Add New Row’ button
- Enter additional charges such as shipping, loading, etc by clicking on ‘+ Add another charge’ button
- Enter customer notes through which details about delivery and terms can be specified
- Once the Sales Order is ready, you can make a ‘Delivery Challan’ and ‘Invoice’ from it. These details are present at the bottom of SO if you see it.
Stages of a Sales Order
It goes through different stages and has a specific status during each stage.
- Open & Unbilled When the order is created, its in open status.
- Partially Executed When delivery challan is ready for a partial quantity
- Executed, Billed, Cancelled and Draft it depends on the actions taken on the it
Once you create a sales order you can do the following things :
- while delivering the goods and services create and print delivery challans
- Through delivery challans create invoices. We can combine multiple delivery challans. And create one invoice.
For more details regarding the various compliances that your company may need to meet. Also, visit our website LegalRaasta. And You can also call at +91 8750008585 or email at [email protected]Moreover You can download the LegalRaasta app to access facilities offered, while on the move.
So, the Sales Order is a confirmation document and its with customer. It basically provides information about goods and services consumed by a customer with its price, quantity. You even know how to create a sales order with help LegalRaasta services.