SBS-OP-DOtC-04-025 Import Process NAM

1. General

Prior to Order Entry, CCS has to ensure that the Customer is already set up in PF1, with the respective Customer Master Data, Material Information and Sales Views duly updated. 

Customer Set-up process as follows:

Process Outline

The scope of CCS in Sales Order Processing is:

1. Receiving Purchase Orders from AM
2. Validating and accepting the Purchase Orders
3. Entering the Order into PF1-VA01
4. Preparing and Submitting Documentation
5. Managing Open Orders
6. Ensuring product is delivered to Customer per Customer’s requirements
7. Generating, consolidating and sending Billing Documents to Customer
8. Ensuring all documentation related to the Customer’s Order are filled in PF1-VA02

1.1. Order Origination – Receipt of Orders

CCS receives orders via:

• Emails from AM

1.2. Supporting Documents

AM will forward customer PO and order offer sheet to CCS.

1.3. Order Validation

If there is a problem with order details or with missing order information, refer to Section 17 – “Problems and Escalation”.

Every Sales Order received must contain the following:

• Sold to party
• Ship to party address
• PO no.
• Date of PO
• Customer requested delivery date
• Product description or code (either one of them)
• Product quantity
• Unit Selling price
• Incoterms (include Destination)
• Mode of shipment
• Payment terms
• Payment Method

CCS will contact AM to obtain missing information (if any).

Price Validation

CCS will validate selling price from Order Sheet against Customer’s PO.

2. Order Entry (PF1)

2.1. Sales Order (SO) Creation

CCS creates TD order with reference to a M3 order already created in PF1. If not available, CCS will create a new M3 order.  

Following are the minimum Field Entries to create / save an SO in PF1

•      Sold-to number
•      Ship-to number
•      Material Code
•      Quantity Ordered
•      Requested Delivery Date
•      Customer Purchase Order reference number
•      Storage location and shipping plant

Price conditions (applicable at Item line level) including prices for standard text and instructions are automatically defaulted from the respective Views / Data Areas in the Customer Master File and / or Customer-Material Info Record in PF1. 

CCS verifies the order details and ensures consistency / coherency of the details with respect to the PF1 default values. This includes:

• correct / valid material code
• delivery address / port of discharge
• duplicate orders (that the order is not already in the system)
• correct price
• Incoterm

Delivery Lead Times

• If Customer’s requested date is shorter than delivery lead time per ‘Average Export Lead Time’, CCS will liaise with BO to accommodate customer’s requested date. If this is not possible, CCS negotiates with AM on the earliest feasible plant delivery date. If AM rejects proposed delivery option, CCS will need to negotiate the delivery date schedule with BO. 
• On the other hand, if (for Business reasons) delivery should and could be scheduled prior to customer requested delivery date, CCS negotiates with customer/AM for an earlier delivery. If customer/AM agrees, CCS will input new agreed date in the system.
• If AM requests for a change in the delivery date after the order is placed in PF1, and if the customer accepts new date, CCS keep the first requested delivery date and input the new date at the order item level.  CCS will enter into internal comments in header level.

Stock Availability

PF1 determines the Delivery Date depending on available stock. If this Delivery Date does not meet customer requirements or when unsure, CCS liaises with BO and customer/AM, and proposes delivery date options. If customer rejects proposed delivery option, CCS reverts to the AM for resolution.

If the resolution impacts the product delivery of other customers, refer to Section 2.2. Back Order Processing. 

For instructions on entering and completing sales orders in PF1, refer to the following PF1 User Guides using the link

http://teamsites.solvay.com/sites/sodaash/SupplyChain/Export%20Academy/Forms/AllItems.aspx

Product Allocation

Product on allocation applies to a pre-determined list of products (defined by Global BO) whose quantity to be allocated to customers is decided by the Global BO. CCS liaises with AM to determine availability date. 

If the estimated product delivery date does not meet Customer's requested date, CCS negotiate with customer/AM and revert / renegotiate new date. If customer rejects proposed date, CCS contacts the AM to seek resolution.

2.2 Back Order Processing

Back Order Processing refers to a situation wherein a confirmed order in PF1 has to be unconfirmed, and then reallocated due to the following circumstances:

• Hazardous situations where quantity needs to be reallocated from one order to another.
• Urgent / emergency orders – this situation arises when a customer has an emergency order that calls for a full or partial quantity to be re allocated from another customer.

CCS negotiates with customers/AM affected by the reallocation. AM may also renegotiate with the customers.

2.3 Advanced Payment

• For sales orders that are on Advanced Payment Term, CODIFHQ team will set up payment terms in PF1
• This automatically places the order on a Credit Block when a Sales Order with this payment method  is created in PF1
• CCS and Accounts Receivable and Credit team receive an email notification or payment advice from AM when the customer makes a respective order payment to Solvay CICC. CCS will follow-up with Credit Team to unblock order from PF1.
• Credit team checks that the payment received is in order – in general, proceeds are the net of the order amount minus the applicable bank charges. Credit Team liaise with CCS and AM on discrepancies and reconciliation
• Credit Management Team release the Credit Block if the payment amount is correct and the CCS continue with order processing. Typical credit release turnaround time is one day
• If required, CCS can print a Pro-forma Invoice via VF01 or ZPV_ORD_SYN.

Late Differentiation

Not applicable

Text Management

CCS maintains various customers’ instructions using the Text function in PF1.

Recap of PF1 Text Management Function

At Sales Order creation time (via VA01), PF1 populates the following fields in the new Order with default data extracted from respective Master Files.

• From Customer Master File:

Sold To

• • • Invoicing Information

Ship To

• • • Carrier Instructions 1
    • Warehouse Instructions 1
    • Marking Instructions 1
    • Invoice Output Title 1
    • Delivery Note Title

• From Material Master File:

• • Long Description
  • Sales Text
  • From Customer-Material Info Record:

Ship To

• • • Carrier Instructions 2
    • Marking Instructions 2
    • Warehouse Instructions 2

The Sales Order type and Order Item Type determine the different texts used at the Order Header and Order Item level

Texts depend on partner function used in the process 

These texts provide instructions, titles and descriptions for documents (including official documents) required in delivery and invoicing.

Independent Text types are used for Shipment Document

Additional Text Entry

• For ad-hoc shipping marks or one-time only instructions for plant / warehouse / carrier, CCS input additional text or overwrites at the order or order item level according to Customer’s PO or OTF.

Examples include:

• • Comments applicable to commercial documents for trial orders related to material properties / specs, or packaging requirements
  • One-off instruction from customers to use / or not use a specific carrier.

2.4. Order Blocks

SOs in PF1 can be blocked due to:

• Product Shortage
• Credit Reasons
• Incomplete Info
• Delivery Conditions

Product Shortage:

Refer to 2.1 SO Creation – Stock Availability

Credit Blocks

PF1 automatically performs a Credit Check at the time the order is saved. The order will be placed on a Credit Block when it meets any one of the following conditions:

• SO Value > Credit Limit
• SO Value > Max Document Value e.g. 1 million Euros
• SO Term of Payment different from that in Customer Record
• SO Customer Review Date is later than the Next Review Date in Customer Master Record
• SO Open Item Due: the no of days of tolerated delay is exceeded and the amount of open item due is higher than the authorized %
• SO Oldest Open Item: the no of days of tolerated delay is exceeded
• When the order is paid by Letter of Credit – this Block is used to set up the documentary credit folder. However, a recent change has allowed to deactivate ATP and to not confirm the sales order

CCS will review credit block reasons and follow up with AM for resolution. Common blockage reasons are:

• Payment not yet received for T/T in advance

Credit Management release the order upon customer’s payment of due amount.

• Overdue Payment

AM to follow up with customer for immediate payment

Credit Management may request AM to provide payment plan case by case. AM send an email for payment promise for some good credit records customers, but some poor credit customers need approval from Asia Pacific Sales & Marketing Manager and OtC Credit Manager.  

• Credit Limit Exceeded

Often times, exceeds in credit limit is the result of unexpected increase in customer demand that has not been forecasted by the Sales Team when applying for the customer credit limit. AM shall send to Credit Management updated customer forecast for the Credit Analyst to set up new credit limits in the Customer Master File.

Exceeds in credit limit can also be due to customer placing order with multiple deliveries over a period of several months and therefore exceeding the credit limit. CCS is to notify AM and the latter is to seek resolution with Credit Management team.

AM to follow up with Credit Team 

Whenever there is a Credit Block, the Solvay Credit Team is alerted via email with a request from CCS to release the Credit Block. 

Incomplete Information

A sales order can still be saved in PF1 even if data entry is incomplete. During the PF1 saving process, the system will automatically alert the CCS that order is incomplete and display the items to be completed. CCS completes the missing information in order for the Supplying Entity to proceed with delivery.

2.5 Order Acknowledgement

• CCS would print Order Acknowledgement from PF1 (VA02) and send to Customers (pdf via email).

3. Financial Document / Documentary Payment

Solvay Peroxythai Banker is K Bank, Silom-Thailand and Solvay Chemicals International (SCI) Banker is BNP Paribas Fortis Belgium.

For Letter of Credit (LC) term orders, CCS review LC draft and liaise with customers to ensure consistency in the terms and text of the document. The customer will advise their bank to issue the LC when it is finalized by both parties.

When the CCS receives notification from Solvay Peroxythai or SCI Banker that the original LC is received, CCS create FinDoc in PF1 using PF1 T–Code VX11N and then assign it to the SO.

4. Regulatory Compliance

4.1  Applicable Regulations

CCS compile and maintain individual lists of specific customer requirements that include regulatory compliance requirements

4.2  Handling of Dangerous & Hazardous Goods

A copy of the SDS document is automatically sent if

• It is a new order
• new version of the SDS has been published and
• will be resent by SAP to all the customers’ who ordered in the past 12 months

A manual copy of the SDS is able to retrieve from each sales order VA02 with output type SDB or from individual transaction code CG54.

5. Commercial Documents – Reprint

When required, CCS could use PF1 T-Code ZPV_ORD_SYN to reprint various commercial documents.

6. Management of Instructions Forwarder

CCS generates Instructions Forwarder from PF1. This information is any special instructions for the forwarder to take note.

PF1 shipping document output type ZC30 in sales orders VA02 is used.

7. Process Outline

7.1. Ex-Stock – Domestic / Local (Direct and Indent)

Refer to Process Flow Chart

Customers / Agents / AM email PO to CCS.

CCS then:

1. Accept and acknowledge receipt of order

• Receive & Validate Order – check unit Price with order sheet and customer PO, volume, payment term etc.
• For discrepancies, reconcile with AM
• Receive confirmation with supporting documentation / approval /amended PO

Stock Availability Check

• Check with Production/Warehouse/Logistics on stock availability
• If stock is not available, advise to replenish stock
• If not, negotiate with AM on stock allocation

2. Create Sales Order

• Create / Complete Order in PF1 – VA01/VA02: Plant code = ex-stock plant code “MTPB”
• If inventory is not available, check and propose new delivery date and advise customer / AM
• If customer rejects date, perform “back order” processing – refer  to Section 2.2. Back Order Processing
• Save Order and Print “Order Acknowledgement” (VA02) send to customer
• Logistics will create Delivery – VL01N,  generate Delivery Note and email it to warehouse
• If there are order blocks due to issues such as compliance, credit, information incompleteness etc., follow up with respective parties to resolve
  • for TT / advance payment, CCS to monitor incoming remittances (report from Finance)
  • for outstanding customer payment, CCS to inform AM for follow up with customer
  • for credit limit, CCS to inform AM for follow up with Credit Manager

Solvay Finance – Release Credit Block – if applicable

Logistics

–     Pick Stock – VL06O, and email pick list to warehouse

–     Print DN for Forwarder

–     Dispatch Goods and notify CCS

3. Bill Customer

• Domestic Order

Invoice will be printed together with DN during delivery to customer.

4. Close Order

• File all commercial documents including PO, Invoices, DN, email exchanges, remittance receipt in PF1-VA02 under the respective Sales Order.

7.2. Ex-Stock – Export (Direct and Indent)

AM email PO to CCS.

For LC, LC copy is also sent to CCS

CCS then:

1. Accept Order

• Receive & Validate Order – Order quantity, unit Price, payment terms etc.
• For discrepancies, reconcile with AM
• Receive confirmation with supporting documentation / approval /amended PO

2. Create Sales Order

• Create / Complete Order in PF1 – VA01/VA02: Plant code = ex-stock plant code
• If customer rejects date, perform “back order” processing – refer  to Section 2.2. Back Order Processing
• Save Order and Print “Order Acknowledgement” (VA02) & send to customer
• If there are order blocks due to issues such as compliance, credit, stock availability or information incompleteness etc., follow up with respective parties to resolve
  • for advance payment, AM will inform CCS and CC will follow up with Credit team  
  • for outstanding customer payment, CCS to inform AM for follow up with customer
  • for credit limit, CCS to inform AM for follow up with Credit Manager
  • for Global Trade Services (GTS) block, CCS to inform Frederic Klinkers to release the block
  • for stock availability (LM/LS block), BO team will review the material availability and advise again

Credit Team– Release Credit Block – if applicable

Once all blocks have been released, BO team will issue the BDL for plant to organize the shipment.

Plant / Warehouse

–     Pick, Pack and Load Goods

–     Advise BO on cargo dimension(LCL)

–     Post Goods Issue

3. Ship Goods to Customer

• BO create Shipment – VL01N for mono-shipment (9002), – VT04 for multi-shipment (9025)
• Instructions to forwarder (ZC30) is sent to forwarder
• Forwarder make vessel booking with Carrier
• For FCL, BO coordinate with warehouse on container trucking
• Forwarder / Carrier – Ship goods, prepare and send B/L to CCS

4. Bill Customer

• CCS Work with Carrier to finalize B/L
• Monitor vessel sail status and on actual “on-board” date, receive Orig. B/L from Carrier
• Generate F2 Invoice for Customer
• Consolidate all shipping documents and send them to Customer (for Net & Advance Payment Term) or Bank (for LC & Draft Term)

5. Close Order

• File all commercial documents including PO, contracts, Export Shipping Docs, Invoices, email exchanges, Draft Term – Bank return & copy of bill collection(DA/DP) receipt into SAP and/or Solvay4me

8. Processing Exceptions – Urgent / Rush Orders

Definition of Rush Order

Domestic Order Processing and Delivery Lead-time: 1 workday to enter order, 2 workdays for organizing delivery, 1 workday for delivery (Total: 4 workdays) 

Export Order Processing and Delivery Lead-time: 1 workdays to enter order, 1 week (2 weeks for Bernburg plant) for organizing shipment 

A rush order is a sales order with a lead time that is less than the average lead time for product delivery.

In the event that a rush order must be fulfilled and stock is not available, refer to 2.2 Back Order Processing.

For Urgent Orders (those that have to be processed during non-Office Working time e.g. national holidays or after Office hours), Customers/AM call Customer Service Manager who will do a preliminary order validation and alert plant on order requirements. Customer Service Manager will email CCS to follow up on order processing when they resume work.

9. Order Amendment / Cancellation

Customer/AM email (with reasons) CCS the request for order amendment or cancellation

Cancellation

• CCS forward order cancellation request to AM for approval (for customer sent request only)
• CCS will process order cancellation in PF1 only with AM's approval

Order Amendment

• CCS check that the order has not been delivered / shipped, and then check with plant on feasibility of order change.
• For changed quantity, CCS check that Minimum Order Quantity (MOQ) is ok, and that quantity order meets price validity criteria.
• For changed delivery date, CCS checks for price validity period.
• If there are issues, CCS reverts to AM for resolution.
• Make order changes in PF1-VA02

PF1 flow is used as reference

Order Amendment – in PF1

As a general rule, order amendment is to be made before the creation of the delivery using VA02.

If however, amendment has to be made after the creation of the delivery; CCS shall inform the BO about the amendment in advance.

A good practice is to add text to the “Texts” Section, under “Internal Comments SP (Z290)” of the “Header” tab to explain the reasons for the amendment.

Order Cancellation – in PF1

Typically, cancellation is linked to a commercial event or a mistake made while entering an order and not immediately detected and corrected.

Cancellation is possible as long as the outbound delivery has not been created.  If there is an outbound delivery in the PF1 document flow, CCS, upon approval from AM, has to contact the plant to ask for the cancellation of the outbound delivery. Then CCS shall select a reason for rejection in the PF1 order. If the order is blocked, CCS shall remove the block and select the appropriate reason for rejecting the order.

The “reason for rejection”, also called reason for refusal, is coded as follows:

10. Customer Complaints

A customer dissatisfaction, expressed verbally or in a documented manner (*), that awaits an answer, an action plan or a refund concerning a product or a service, constitutes a complaint.

Even if not expressed by the customer, the following also amounts to a customer complaint:

• Refusal of a product (total or partial)
• Problem linked to product quality
• Problem of weight on packaged products
• Problem of weight on bulk products, with specific adjustment request from the customer
• Error of delivered product

 Customer complaint must be logged in Salesforce and CCS to follow-up and ensure complaint is closed within 15 days from logged date.

11. “Goods Return” Orders

The Return of Goods amounts to cancellation of a sale and putting back into inventory the products returned

Following are some of the reasons for returning goods:

• Quality of batches dispatched;
• Quality of packaging providing grounds for not using the goods;
• Errors in quantities;
• Wrong specs
• Taking back as a “commercial gesture”

Process Outline

Refer to the “Goods Return” Flow Chart in

Receive and Register “Goods Return” (RE) Request

• CCS receive “Goods Return” (RE) Request from customer/AM, or detect the need to process a “Goods Return” (RE) transaction to rectify discrepancies / errors in invoiced quantities, or process returns based on commercial gesture.
• CCS email RE request, together with supporting documents where applicable, to Plant Manager for approval.
• CCS work with respective parties to investigate / validate RE causes.  

1. Process Physical “Goods Return” (RE) Request

• For approved “Goods Return” request that involve physical flow of goods, CSS create a “Goods Return” (RE) Order in PF1 (VA01) with Reference to the Original Invoice and the following:
• Order type = RE
• Sales Org = 0366 / CGEX
• Distribution Channel = 11
• Division = 11
• BO monitors the status of RE orders to ensure the arrival of the returned goods at the plant, and that “physical’ receipt is recorded.
• CCS print CR/DR Memo and hand it to AM for signature 

BO

–     Create “RE” Delivery, with batch no copied from the Original Invoice – VL01N

–     Arrange inbound delivery if needed

–     Receive returned goods, perform Post Goods Receipt (PGR) in PF1 – VL02N, transfer returned goods to unrestricted stock (PF1) – MB1B [453] or to blocked stock (PF1) – MB1B [459] depending on Quality Inspection requirements

AM – Sign on printed CR/DR Memo Request

Sometimes, Customer will arrange return shipment but bill Solvay for shipment costs

Issuance and Dispatch of Credit Note to Customer

• When the ‘Billing Block’ is removed, CCS generate RE Credit Note in PF1 – VF01.
• CCS print out RE Credit Note in PF1 – VF02, verify its accuracy and then send it to Customer

2. Process Credit Note (CR)

When the “Goods Return” does not require physical flow of returned goods, CCS

• Create Credit Note in PF1 – VA01 [G2] or [ZG2]
• Print CR/DR Memo and hand it to AM for signature
• Email Customer Service Manager and request for Billing Block Release 

Issuance and Dispatch of Credit Note to Customer

When the ‘Billing Block’ is removed, CCS generate RE Credit Note in PF1 – VF01.

CCS print out Credit Note (VF02), verify the following before sending it to Customer:

• It matches the customer’s return request;
• It matches the data in the customer database;
• It contains all the mandatory information.

3. Update of Complaint Status in PF1-QM02

For a claim-related Return Order / Credit Note that is pre-registered in Salesforce, CCS updates the Credit Note No and Credit Note Amount and close entry in Salesforce.

4. Archival of RE and Credit Note Documentation

CCS archive copies of the Credit Note and all supporting documentation (customer letter of complaint, follow-up email exchange, Quality report, letters of reply to the customer, approval request form etc.) in VA02 under the respective order.

11. Billing Adjustments and Cancellation – Issuance of Credit / Debit Notes (CR/DR)

Billing adjustment may be the result of the following events:

• Price error
• Quantity discrepancy
• Order input error (item code, customer code, incoterms, delivery date)
• Customer error (product reference, delivery date, desired quantity etc.)
• Rebilling to include costs not anticipated in the order such as fumigation, shipping etc. of shipping costs not anticipated in the order… etc.
• Changes in contractual price following new negotiation, inter-company price, changes in delivery terms (incoterms)

1. Create DR / CR Memo Request

• Receive pre-approved Request for Issuance of Credit / Debit Note
• Create Debit / Credit Memo Request in PF1 – VA01
  • With Invoice Reference
• Print CR/DR Memo and hand it to AM for signature

AM – Sign on printed CR/DR Memo Request

2. Generate DR / CR Memo

• When the ‘Billing Block’ is removed, CCS generates DR / CR Memo in PF1 – VF04 / VF01.
• CCS print out DR/CR Memo from PF1 – VF02, verify its accuracy and then send it to Customer 

3. Close Request

• CCS archive copies of the DR / CR Memo and all supporting documentation

All Credit / Debit Note Requests created must reference the original invoice; the texts on the CR / DR Notes include the original invoice reference.

When the CR / DR request is created in PF1, it automatically places a billing block for this order.

12. Open Order Management

Recommendation

BO and CCS jointly work out a structured open order management process that addresses the following:

a. Stock availability and allocation (include but not limited to Back Order Processing)

b. Delivery Dates

c. Communication of committed delivery date

This open order management process should include:

• Daily review of an Open Order Report (BO) by CCS to identify blocked orders, and orders that are due in the following week through transaction ZPVD

• Various types of Communication
  • CCS  informing customers / AM of expected delivery dates
  • BO informing CCS of the status / planned dates to meet orders. CCS inform customers / AM of late order details

13. Period-end Processing

Month-end:

• Per normal month-end routine

Quarter-end:

• Per normal month-end routine

Year-end:

• Per normal month-end routine

14. Problems and Escalation

Where there is a problem with customer orders that impact processing of the order, CCS shall contact AM.

For other operational issues or exceptions, CCS consults their immediate Customer Service Manager for advice.

15. Filing and Archiving

CCS is responsible to file and ensure all customers’ purchase orders, Internal Order Forms, Commercial offers, Export Shipping Documents, Invoices and all important exchanges with customers, especially for those linked to pricing and delivery dates. These documents are file in SAP and/or Solvay4me and to be kept as records for a retention period per country’s regulatory requirement.

16. References & Related Links

• All O2C export orders relates reference to refer to :

http://teamsites.solvay.com/sites/sodaash/SupplyChain/Export%20Academy/

17. Appendix

General