The hard work is done, negotiations are complete, the customer is satisfied, and the salesperson has an order to provide goods and services for an extended and regular delivery. The contract is for repeat orders over a defined period of time. With PeopleSoft Order Management, the mundane task of entering multiple orders for each delivery can be dealt with via a Buying Agreement Document.
So… what does a Buying Agreement provide?
Order Management’s Buying Agreement facilitates the maintaining of various flexible sales parameters between a customer and a selling organization. Various sales parameters and other terms and conditions can be defined in a flexible manner between parties using Order Management’s Buying Agreement.
One-time set-up of the Buying Agreement creates a business document from which individual orders can be automatically generated. There are a few key sections of the Agreement that facilitates this hands-off process.
Buying Agreement form:
This is where the Agreement is defined with all the parameters, terms and conditions that may pertain to all orders generated from the Buying Agreement. New Buying Agreements can be created by copying an existing Agreement OR can be created from an awarded Customer Quote transaction. All critical Agreement parameters such as Agreement validity, Order Amount OR Order Quantity thresholds, indications of whether the agreement is for a Customer OR a Customer Group and more, are maintained in the Buying Agreement form. The flexibility of a Buying Agreement allows either an individual Customer or a Group of Customers to be covered by the pricing, delivery, terms and conditions of the Buying Agreement.
In addition to maintaining information on existing Agreements OR Quotes, through which a new Agreement is created, users can add Customer PO number, which can be copied into the Agreement lines by using the “Update PO” button.
The Agreement information also enables the user to indicate whether the agreement can be adjusted – during a price change. The price on the Sales Order that is generated from this Agreement can be locked as in the original Buying Agreement OR can be changed – by using the ”Price Can be Changed on Order” flag.
Line details cover the finer details of the Agreement such as the Product or Product Group, Price, Rebate/Penalties and more.
Users can maintain important administrative information such as the Support Team Member managing the agreement, supporting documents as attachments related to the Agreement, and even additional notes to maintain a log of communication between stakeholders in the Buying Agreement Header section. Similarly additional information related to each agreement line is maintained in the additional line detail section of the document.
How is the order created?
A Buying Agreement can easily be converted into a Sales Order if the parameters for auto-generation are defined. A schedule of releases by quantity, date and time can be set up on the Buying Agreement to generate future sales orders when the release date is met. The quantity to be released from the Agreement, is entered in the “Line – Release Section” which creates a basic Order Header, Line and Schedule when the “Convert Agreement to Order” process is run. Afterwards, the “Order Complete” process is then run to fill in the Customer and Product-specific defaults and completes the creation of a Sales Orders which are then ready for various post-order processing like credit checks, hold checks and passing of the demand to the fulfillment process.
If you prefer a more manual and controlled effort as an alternate method of creation, sales orders can also be generated online via “Convert Agreement by Customer” process.
What happens with my manually entered Sales Orders?
When a Customer Service representative creates an Order for a Customer with a Buying Agreement, the system will default in all the Order-specific values onto the Sales Order header, line and schedule. Pricing is defaulted to the Order line as per the price on the Buying Agreement. As long as the Order date plus any defined “Grace Days” are within the parameters defined on the Buying Agreement, the Sales Order will inherit all the Buying Agreement parameters.
Agreements that near the schedule end date [inclusive of grace days if any] can be closed by running the “Close Agreement” process.
Peoplesoft Buying agreement is a powerful transaction that can be leveraged to ensure that the sales orders are absolutely error free, as they are pre validated in the agreement level, and the customer representative is empowered to honour various customer requirements, compounded with a varied set of sale parameters – resulting in a win-win situation for all the stake holders.