Easy OnBoarding Customer Consignment Process Easy OnBoarding Course

Easy On-Boarding Customer Consignment Process

Easy On-Boarding Course Overview • Introduction To Customer Consignment • Business Overview • Customer Consignment Process 2

Easy On-Boarding What Is Consignment Inventory? • Inventories, generally of finished goods, that are in the possession of customers. . . but remain the property of the manufacturer by agreement with those in possession. • The process of a supplier placing goods at a customer location without receiving payment until after the goods are used or sold. • APICS Dictionary (Twelfth Edition, 2008) 3

Easy On-Boarding Why Consignment Inventory • Customers dictate new business agreements • Customers can lower their inventory levels and inventory investment • Less inventory obsolescence • More supplier responsiveness • Suppliers manage their own inventory • Increased traceability of off-site stores 4

Easy On-Boarding Life Cycle Distribution Warehouse 1 Contract Inventory Shipping No 4 In-Transit 3 Warehouse Delivery Inventory 2 In-Transit Consignment Inventory Customer Site Receiving Inventory y 6 Yes Invoice 5 Record Usage 7 Accounts Payable Record Usage Manufacturing 5

Easy On-Boarding Life Cycle Flowchart Create Sales Order Goods In-Transit Inventory Issue Allocate Inventory Ship Goods ASN Sent Distributor Receipt Distributor Shipment Consign Transfer Sent Customer Receipt Consignment Inventory Customer Records Usage A 6

Easy On-Boarding Life Cycle Flowchart (cont. ) A Notify Supplier by Paper Receive Notice by Paper Notify Supplier by EDI Record Usage Invoice Print and Post 7

Easy On-Boarding Terminology • Customer Consignment Inventory - Usage - Batch ID - Maximum Aging Days - Age Date 8

Easy On-Boarding Customer Consignment Users QAD EA SE Sales Agent Contract Administrator Materials Manager Shipping Monitor Usage Reporting Consignment Transactions capture account bookings Shipping Establish Contract Invoice Usage A/R 9

Easy On-Boarding Business Overview 10

Easy On-Boarding Business Overview • • Ship Normally Retain Ownership of Material Defer Invoice and A/R Activity Maintain Visibility of Inventory Manage Consignment Inventory Accounts Recognize “Usage” by Customer Create Audit Trail Trigger Invoice or Process Self-Bill 11