Supply Chains: A Manager's Guide

Collecting the Cash

Once an order has been delivered to the customer, the third and final phase of the fulfillment cycle begins—getting paid. The first step in this process is determining the actual amount due. In most cases, this is simply the total at the bottom of the supplier's sales order, which represents the amount the customer agreed to pay. However, the figure on the order may not be final, in which case further computation is needed to determine the amount due. For example, many bulk goods are sold by weight or volume, and the quantity of the shipment isn't finalized until the shipment is weighed or measured at the receiving end.

Once the amount due has been determined, the supplier generates an invoice for that amount. Invoices have ...