Managing Drop Shipments and Special Orders in Your Inventory System

Managing Drop Shipments and Special Orders in Your Inventory System by KW Global Solutions

The Drop Shipments and Special Orders feature allows businesses to efficiently create purchase orders for specific items. When a sales order that contains drop ship or special order items is approved, a purchase order is automatically generated.

Understanding Drop Shipments and Special Orders

Drop shipments and special orders differ from regular inventory processing:

• Drop Shipments: The vendor ships the item directly to the customer, bypassing your inventory.

• Special Orders: These track purchases that do not follow standard inventory processing, such as urgent or customized orders. The item is fulfilled only when the vendor delivers it to your company.

Items are identified as drop shipments or special orders during the sales order creation process.

Manually Setting Items for Drop Shipments or Special Orders

You can manually designate an item for drop shipment or special order in sales orders:

• Entering a Sales Order: In the Create PO column, select Drop Ship or Special Order.

• Editing a Sales Order: In View mode, click Drop Ship or Spec. Ord. in the Create PO column. In Edit mode, click the line-item and choose Drop Ship or Special Order in the Create PO field.

Once a sales order containing a drop ship or special-order item is saved or approved, a purchase order is automatically generated.

Processing Purchase Orders

• Drop-ship purchase orders include the preferred vendor and the customer’s shipping address.

• Special order purchase orders include the preferred vendor and the company’s shipping address.

• If the order is from a web store or the user lacks permission to create purchase orders, the Administrator role handles the purchase order creation.

Managing Currencies and Units of Measure

• Multiple Currencies: The purchase order uses the vendor's primary currency.

• Multiple Units of Measure: Ensure consistent units of measure between the sales order and purchase order to avoid rounding errors.

Viewing and Managing Purchase Orders

To generate purchase orders:

• Navigate to Transactions > Inventory > Order Items.

• View placed orders under Transactions > Purchases > Enter Purchase Orders > List.

• Click View or Edit to access a specific order.

• The Status column reflects the order's progress.

Automating Purchase Order Preferences

Set preferences for automatic emailing, faxing, or printing of purchase orders. Adjust settings via Setup > Accounting > Preferences > Accounting Preferences, then navigate to the Order Management subtab.

Marking Purchase Orders as Fulfilled

The process for receiving a purchase order and marking a sales order as fulfilled varies based on shipping and receiving methods:

• Advanced Shipping & Advanced Receiving: Click Mark Shipped on the purchase order to update fulfillment. Submit the fulfillment to update the purchase order and sales order to Pending Billing. If receiving items on the Receive Purchase Order page, the sales order must be manually updated.

• Advanced Shipping Only: Click Receive on the purchase order to receive and bill it. Click Fulfill on the sales order to complete fulfillment and generate an invoice or cash sale.

• Advanced Receiving Only: Click Receive on the purchase order to process receipt and billing. Click Process on the sales order to mark it as fulfilled and generate an invoice or cash sale.

• Neither Advanced Shipping nor Advanced Receiving: Click Receive on the purchase order to receive and bill it. Click Process on the sales order to fulfill it and create an invoice or cash sale.

By properly configuring and managing drop shipments and special orders, businesses can optimize their order fulfillment processes while ensuring accurate inventory tracking and customer satisfaction.