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Back Order with RMPro
A Back Order is when you sell something to a customer which you don’t actually have or own in your stock, but are able to order as needed from your Vendors. It constitutes a practical sale transaction between your customer and you, but is treated quite differently than a normal sale.
RMPro has extensive abilities in the field of Back Orders. From the storage and organization of various SKU’s available from your vendors, to the selection of these SKU’s in the customer’s invoice, to the ordering or linking of these SKU’s on the Back Order invoice(s). Back Orders are typically done for SKU’s which are available in multiple quantities from the Vendor, and not necessarily unique one-of-a-kind items.
Illustration 1: RMPro recognizes the hierarchy of SKU’s of a Vendor, divided by Design and Color
The first important difference in RMPro is how it stores your inventory information. Anything which is common between the continuous product is stored in a “SKU” which stands for “Stock Keeping Unit”. Imagine pens, for example. Suppose you have 3 different ink pens, all of which are the same brand, same size, same style, same color, same everything. It is presumed that all these pens will have the same SKU. If there is one more pen, exact same brand, style, and size, but just a different color, then the SKU will be very close to the others, but will not be the same. This pen will be considered to be in the same Collection and Design for the same Vendor, but it’s a different available Color, therefore holding a different SKU than the others.
Illustration 2: RMPro stores SKU information separately from Item information
RMPro stores this information intelligently. Every single Item (or unique individual inventory piece) of yours of course has its own unique stock number. However, the “SKU Information” can be shared between the items. In the above example, there are 4 pens, each with their own unique Item Number, but 3 of them are one SKU and the other 1 is another SKU. The 3 items which have the same SKU are actually sharing the same “SKU Information” as each other. If a SKU property of one of the pens is modified, the change will also be reflected on all other items using the same SKU.
Storing the SKU information in the RMPro database in this manner allows flexible abilities when it comes to Back Orders in RMPro. Since all these SKU’s can be pre-loaded in the system, these saved SKU’s can be retrieved at any time to generate a Back Order for one of such items. Rather than filling out every little piece of information about an item which you intend to Back-Order for a customer, you just simply select the Vendor’s SKU and all the information which is already stored will automatically be linked. When entering such an item, you can pick a vendor to show a list of collections of theirs, and then pick a collection to show a list of their SKU’s. Picking a SKU will enter all the information.
Illustration 3: Selecting SKU’s on a Back Order Invoice in RMPro’s Point of Sale
This is just the beginning. Once a Back Order Invoice has been generated in RMPro, there are a number of things which can happen to the items on that Invoice. Let’s assume there are 3 items on this Back Order Invoice. Two items are from one vendor, and the other one is from another vendor. Remember, the “Items” on this invoice don’t literally exist yet. They’re merely “Virtual Items” waiting to be linked with “Real Items”.
Illustration 4: Finishing invoice, automatically creating Purchase Order and Shipping, and taking $200 Deposit
Let’s say the two items from one vendor are no problem, the Vendor approves the order, and you can simply generate an automatic Purchase Order for those items, based on the information already there. The vendor tells you these two items will take 1 week to be shipped. The other vendor however says their item won’t be shipped for 4-6 weeks, because it has to be produced.
Illustration 5: Marking Back Order items for Purchase Orders (ordering what customers bought)
Meanwhile, assume you realize you have an item in-stock at another location which perfectly matches the details of one of the 2 items from the first vendor. You and the customer come to an agreement that they will purchase this one instead of ordering it from the vendor, possibly for a cheaper price. You can simply cancel this item on the Purchase Order to the Vendor which you had generated for this Back Order, and you can re-link this Back-Order (or virtual) item to the existing item in your inventory instead.
Illustration 6: Unlinking an item from a Back Order item
RMPro handles this entire scenario, and keeps your information fail-safe too. In other words, it’s hard to do accidental changes in RMPro because it has appropriate protection from changing certain things at certain times. For example, if you try to link this Back Order item with an inventory item of yours which is nothing like the one you’re trying to link it to, all the differences will be clearly highlighted in red to alert you the items are far different than each other.
Illustration 7: RMPro alerting that two items you’re linking don’t match each other
So on this Back Order invoice, at this point, you have 1 item waiting to be received in 1 week, 1 item already linked to an item in your inventory, and 1 items waiting to be received in 4-6 weeks. Now the first item is being delivered by the shipping company. When you receive this item in RMPro on the Purchase Order, it will recognize that this item is linked to a Back Order, and will automatically prompt you to further process this Back Order invoice appropriately.
Illustration 8: Purchase Order automatically created by Back Order, showing that 2 items are linked to a Back Order
Let’s say the Back Order Invoice was produced at one of your locations, but this item was received at your main Warehouse instead. RMPro will automatically alert you that this item needs to be transferred to the other location because it belongs to a customer already. You will then be able to generate the transfer in a flash, speeding up the flow of your work. As soon as the item is received at the other location through the transfer, the item can then be finally marked as “Sold” to this customer. Until this point, the item will be considered “In-Stock” but will be protected from doing anything with it on accident, because RMPro knows this item belongs to a Back Order Invoice.
Illustration 9: Receiving Purchase Order and being prompted to set Back Order items as Sold
Anywhere in the system which shows any information about the items on the Back Order Invoice or the items on the Purchase Order clearly shows an alert that it’s linked, thus letting you know that it belongs to a customer via Back Order.
Illustration 10: Customer History lists two Back Order invoices in the Current State
This information can be further tracked by a number of reports and modules. For example, the Customer Receivable reports list invoices which have not yet been marked as Sold to the customer. Even if you have received the items and sent them to the customer, RMPro still has further functionality to “Mark” these back order items as sold.
Illustration 11: Back Order Item Status report lists the details and status of all items related to Back Order invoices
Illustration 12: Outstanding Back Orders will be considered in the Alerts when it is past-due
There is also a global option in RMPro for accounting purposes, when to account a Back Order invoice. You can either consider the Back Order invoice as a real invoice at the time it’s created, or at the time when the items are set as sold. This option is also available in every report which displays any type of information regarding customer invoices.
Illustration 13: Global option of when to consider Back Order invoices as a real invoice
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