Case Study: Premium Patio Furniture
Case Study: Premium Patio Furniture
Premium Patio Furniture manufactures lawn and garden furniture, marques, and buildings. They manufacture both their own range of products and made to order products. The range of value of orders can be from $100 to $500,000. Premium Patio Furniture markets their products through retailers and direct sales. Larger orders may involve architects and builders and become separate projects. You are being asked to develop a system which will be used to monitor the supply of the large number of orders that are not set up as separate projects.
Order Fulfilment Clerk
My responsibility as an order clerk is to arrange the delivery of orders to customers. Orders arrive from several sources: retailers, individual customers, sales reps, and builders. There are basically four types of order. Bulk orders from retailers, custom orders from retailers, direct sales (both custom design and standard products) to a customer, and building contracts. Orders from retailers and builders with prior internal credit approval are sold on a payment within 30 days of delivery basis. If the order is significantly over the purchaser’s credit allowance, the purchaser is advised that the order cannot proceed until a payment is made on the outstanding balance and the order is held for 30 days and accounts receivable is informed of the new order. Accounts receivable then advises me when a payment is received. If no payment is received, the order is dropped. When payment is received or the order is within the credit limit, I first identify if it is an order requiring installation or not. Orders requiring installation are immediately passed to an Installer to schedule the installation. After they schedule the installation, the order is returned to me for processing. A date for shipment is set and the required materials are reserved and all other processing tasks are completed. Orders that do not require installation are immediately processed for delivery. This processing includes determining the packing requirements including weight determination and products to include, and delivery method. The processed order is passed to either the installer or to the warehouse for packing.
As a sales representative, I liaise with retailers, builders and individual customers to secure orders. My responsibilities are wider than just obtaining orders as I also need to identify potential retailers and builders for future sales. When I identify a new retailer or builder, accounts is notified so that they can determine the credit level allowed for the customer.
When an individual customer contacts Premium Patio Furniture and expresses interest in placing an order, I take responsibility to collect customer details and to secure an order. In most situations I need to supply the customer with a quote, which they may later accept as an order. In the case of simple repairs or replacement, details of the requirements are recorded. If the items are standard stock items, the price including shipping and delivery is calculated and payment is collected from the customer. When payment is secured, the order is then sent to the order clerk.
When the sales rep receives an order or quote request that requires a site visit, they arrange a site visit. During the visit, the Sales Rep negotiates the order details with the customer. A drawing is prepared with any relevant measurements and locations of furniture or buildings (buildings may include decks, deck enclosures, temporary or permanent marques or pergolas, sheds, or granny flats). Extra requirements like plumbing, landscaping, wiring, or other special requirements are noted. From this information, the Sales Rep prepares a quotation and sends the quote to the customer. If the customer was obtained through a retailer, a note is made of the retailer on the quote so that the retailer will receive a commission once the goods are installed.
The Sales Rep may decide it is a ‘large project’ which needs to be set up as a special project and will be assigned to an Architect to oversee. In this case a quick description of the requirements is prepared and the Sales Rep organises for an Architect or Builder to be assigned. The Architect or Builder places all orders for the project through the Sales rep.
The Installation Manager sets and controls the installation dates for orders. Each order is assigned to an installer. The Installer is provided with each week’s installation requirements at the start of the week but the Installation Manager. Sometimes the Manager may have to alter the schedule during the week, especially if an installation takes longer than expected. Prior to departing for an installation, the warehouse is contacted to assure that the goods for installation have been shipped and delivered or a time has been set for the delivery. If the goods will not be ready, the Installation
Manager is advised and the installer reschedules the installation. When an installer completes an installation, they set the status of the installation to complete and advise accounts receivable of the completed order and payment details. In the case of sale on ‘terms’, they only need to provide the order details. If a cash payment was made, this needs to be given to accounts.
When a processed order is received from the Order Fulfilment Clerk, the date for delivery is noted and those orders that are to be sent at a later date are put in the delayed delivery file. At the start of each day the delayed delivery file is checked for orders that are due for delivery and they are given priority shipping status and are the first items shipped each day. After the priority shipments are completed, other orders are packed and shipped. Some orders are marked ‘customer pick up’, and these are placed in the pick-up area of the loading dock. Orders for local delivery are packed and placed in the ‘local delivery’ section where drivers collect the orders for their delivery area. For orders outside of the local area, the delivery service for the order is contacted and advised that the order is ready for pick-up and delivery. In all cases, when the order is picked up a record is made of who picked-up the order and is signed for by the person collecting the goods. When the goods are received by the customer, the customer signs the delivery docket, which is then returned to Accounts.