DEPARTMENT OF BUSINESS &

INDUSTRIAL MANAGEMENT
VNSGU, Surat

SUBJECT:
SSCM
Topic:

Order Processing
Class:
MBA (Sem- 4, Div. - B)

Submitted By:
Patel Parth

SUBMITED TO:

Dr. V.B. Patel

Order processing

Order processing is the process or work-flow associated with the picking, packing and delivery
of the packed items to a shipping carrier. Order processing is a key element of order fulfillment.
Order processing operations or facilities are commonly called "distribution centers".

Order processing is a key element of Order fulfilment. Order processing operations or

facilities are commonly called "distribution centers".
"Order processing" is the term generally used to describe the process or the work flow
associated with the packing and delivery of the packed item(s) to a shipping carrier.
The specific "order fulfilment process" or the operational procedures of distribution
centers are determined by many factors. Each distribution center has its own unique
requirements or priorities.
Order Processing involves various procedures like pick up, packaging, and delivery of
packed items to the shipping carrier.
Order Processing software, which help you to take your business orders effectively and
encourages interest from your customers towards repeating their business.
Sales order
The Sales order, sometimes abbreviated as SO, is an order issued by a business to a customer. A
sales order may be for products and/or services. Given the wide variety of businesses, this means
that the orders can be fulfilled in several ways. Broadly, the fulfillment modes, based on the
relationship between the order receipt and production, are as follows:

Digital copy - Where prices are digital and inventory is maintained with a single digital
master. Copies are made on demand in real time and instantly delivered to customers.

Build to stock - Where products are built and stocked in anticipation of demand. Most
products for the consumer would fall into this category

Build to order - Where products are built based on orders received. This is most prevalent
for custom parts where the designs are known beforehand.

Configure-to-order - Where products are configured or assembled to meet unique

customer requirements e.g. Computers

Engineer to order - Where some amount of product design work is done after receiving
the order

Process of order processing

Process:
Order processing is a sequential process involving;

Picking: consists in taking and collecting articles in a specified quantity before shipment
to satisfy customers' orders.

Sorting: process that separates items according to destination.

Pre-consolidation or package formation: includes weighting, labeling and packing.

Consolidation: gathering packages into loading units for transportation, control and bill of
lading.

Customer Order Cycle

Payment

Factors affecting order processing:

The specific "order fulfillment process" or the operational procedures of distribution centers are
determined by many factors. Each distribution center has its own unique requirements or
priorities. There is no "one size fits all" process that universally provides the most efficient
operation. Some of the factors that determine the specific process flow of a distribution center
are:

The nature of the shipped product - shipping eggs and shipping shirts can require
differing fulfillment processes

The nature of the orders - the number of differing items and quantities of each item in
orders

The nature of the shipping packaging - cases, totes, envelopes, pallets can create process
variations

Shipping costs - consolidation of orders, shipping pre-sort can change processing

operations

Availability and cost and productivity of workforce - can create trade -off decisions in
automation and manual processing operations

Timeliness of shipment windows - when shipments need to be completed based on

carriers can create processing variations

Availability of capital expenditure dollars - influence on manual verses automated

process decisions and longer term benefits

Value of product shipped - the ratio of the value of the shipped product and the order
fulfillment cost

Seasonality variations in outbound volume - amount and duration of seasonal peaks and
valleys of outbound volume

Predictability of future volume, product and order profiles

Predictability of distribution network - whether or not the network itself is going to

change

Presence of small volume distribution

Minimization of shipping costs