Overview
In Rootstock, it is possible to create a Sales Order in one Company/Division, the ‘Buying’ Company/Division, which automatically creates a Purchase Order within the same Company/Division. When the Purchase Order is submitted to the Vendor, a second Sales Order is automatically created in the second company, Supplying Company/Division.
Terminology
Buying Company: The Company where the end Customer's (or final Customer's) Sales Order is created (the actual demand) followed by a Direct Purchasing Purchase Order. Need to fulfill the Sales Order to get the products to the end Customer.
Supplying Company: The Company will fulfill the demand internally (Inter-Company / Inter-Division) by supplying the products. Inventory can be further purchased or manufactured as per the requirement. Need to fulfill the Sales Order to get the shipping transactions in the system.
NOTE Both of the above can be described differently as per business requirements and use cases. We encourage you to discuss the whole process thoroughly while implementing the solution with our Professional Services team.
Use Case
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Inter-Division (aka Intra-Company) - when the "Buying" Division and "Supplying" Division are in the same Company.
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This process can be designed in such a way that the initial Sales Order (in "buying Division") would represent the "final Customer" and the Vendor name, on the auto-created Purchase Order (in "buying Division" only) represents the "supplying Division". When the Purchase Order is submitted to the Vendor, the Sales Order in the "supplying Division" will have the Customer as to the "buying Division".
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Another option is that the user can choose to use Division to Division Transfer to directly purchase in the "supplying Division" and transfer the item to the "buying Division" if no revenue considerations are an issue.
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Inter-Company - when the "Buying" Division and "Supplying" Division are not in the same Company.
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This process can be designed in such a way that the initial Sales Order (in "buying Company/Division") would represent the "final Customer", and the Vendor Name on the auto-created Purchase Order (in "buying Company/Division" only) represents the "supplying Division".
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When the Purchase Order is submitted to the Vendor, the Sales Order in a "supplying Company/Division" will have the Customer as to the "buying Division". Remember, the "supplying" Company is different from the "buying" Company here.
Prerequisites
Setting up the Product Master and PO Control records are very important and critical for the whole process to work without any disconnect.
Company Master > Accounting tab > Bypass AP/AR for Intra-Company Txns (aka Inter-Division)
Some Companies prefer that no AP/AR transactions are created when this type of Inter-System transfer occurs.
When performing an Inter-Division Direct Purchase between 2 Divisions in the same Company, turn on the ‘Bypass AP/AR for Intra-Company Txns’ function to prevent the creation of AP/AR transactions. When performing an Inter-Company Direct Purchase between 2 Divisions in different Companies, turn this function on in each Company’s Master record.
Company Master > Accounting tab > Bypass Inter-Company Like Intra-Company
When enabled, this feature causes Inter-Company Sales and Purchase Orders to be treated like Intra-Company orders, bypassing AP and AR and redirecting COGS (all per Intra-Company settings).
PO Control > 'Inter-System Direct Sales Active' field should be checked.
This will allow the creation of direct Purchase Orders from a Sales Order. This must be on for the Division in which the Purchase Order would be created.
Vendor Item Master > Inter-System Direct Sales tab, for the Buying Company/Division, indicate the 'Sell from Company', the 'Sell from Division', the 'Sell from Customer', and the 'Sell from Product'.
IMPORTANT The Inter-System Direct Sales tab will not show unless the PO Control Record > 'Inter-System Direct Sales Active' flag is checked.
Purchase Item Master > Inter-System Direct Sales tab, for the Buying Company/Division, indicate the ‘Sell from Company’, the ‘Sell from Division’, the ‘Sell from Customer’, and the ‘Sell from Product’.
IMPORTANT The Inter-System Direct Sales tab will not show unless the PO Control Record > 'Inter-System Direct Sales Active' flag is checked.
Vendor Item Master: This record must exist for the system to create an auto direct Purchase Order from the Sales Order line (when it is firmed). This record should be for the Purchasing Division, the item to be purchased (
Purchase Item Master must exist), and the Vendor (for which the Purchase Order should be created automatically).
NOTE "Primary Vendor" must be checked for automatic direct purchase, or you can define on Rootstock Product Master record > Direct Purchasing tab > Buy from Item Vendor
SO Control > Order Processing tab > ‘Direct Purchasing Feature Active’ & ‘Inter-System Direct Purchasing Active’.
Enable both of these functions for both Divisions, whether the transfer is Inter or Intra (between Divisions). This basically means that the Divisions qualify to create direct Purchase Orders and for Inter-Company functionality.
Rootstock Product Master Record: should exist in both the ‘buying’ and ‘supplying’ divisions.
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The Product spawns the direct Purchase Order for the ‘Buying’ Company/Division when its Sales Order Line is firmed.
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Product Master > Direct Purchasing Tab
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Check ‘Auto Create Purchase Order Line’ for auto-creation of Direct Purchase - Purchase Order Line.
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(Optional) Check ‘Auto PO-Drop Ship to Customer Address’ for using Sales Order Header/Line Ship-To addresses on Direct Purchase - Purchase Order Header/Line, Ship-To addresses. When this resulting Purchase Order is submitted to Vendor, and a Direct Sales - Sales Order is created, the Ship-To addresses from the Purchase Order Header/Line will also be transferred to the Direct Sales - Sales Order Ship-To addresses the Supplying Division.
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(Optional) Check ‘Auto-PO-Use Item Vendor PO Header’ so that direct purchases are always created for the same Purchase Order Header, referenced on Item/Vendor.
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For the 'Supplying' Company/Division, Product to be used to create the direct Sales Order Line when Purchase Order is Submitted to Vendor.
IMPORTANT Do not turn these flags on for the Product record in the supplying Company/Division. This should be set up only if the Supplying division is further buying from another Division/Company.
Vendor Record: Ensure that the appropriate Vendor record exists which represents the Supplying Company/Division and that the Vendor’s Address information is included on the record.
Customer Record: Ensure that the appropriate Customer record exists, which represents the Buying Company/Division, and that the Customer Address information is saved on the record.
Processing
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Create a Sales Order in the Buying Company/Division (i.e., creating a demand). Upon firming the Sales Order, the Purchase Order for the Supplying Company/Division is automatically created and can be seen in the ‘Advanced’ section of the Sales Order UI, under the ‘Direct Purchases’ tab. (learn more in Direct Purchasing)
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Locate the Purchase Order record (also available on Sales Order > Direct Purchasing tab). Notice that the initiating Sales Order Line is referenced on the field 'Direct Sales Order Line' of the Purchase Order Line created, and the corresponding Sales Order Demand from the Buying Company is referenced on the 'Direct Sales Order Demand' of the Purchase Order Line.
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When the Purchase Order is submitted to the Vendor, a Sales Order is automatically created (via SOAPI) in the Supplying Company/Division. The source Purchase Order source number is stamped on the field 'Customer PO' of the Sales Order Header created. And the corresponding Sales Order Line will be referenced on the field 'Inter-System Sales Order Line' of the source Purchase Order Line.
NOTE When the Bypass AR feature is active and the user is creating the Sales Order Lines from Purchase Order Lines, when the Sales Order Invoice is Approved, the created journal will use the existing inter Division clearing account ('
Account, Div to Div Clearing' from the Company Master) instead of the AR Account.
IMPORTANT (most common issues)-
If the auto-created Sales Order is not created, check the related SOAPI for errors. Fix the errors and check "Retry indicator" - this should place the record in the next Apex job run.
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If there is no error but the record did not process, check to be sure the Apex job "PeriodicBatchProcessor" is running. The job can be killed and restarted if needed.
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Pick, Pack, Ship, and Invoice the Sales Order in Supplying Company.
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Receive the Purchase Order at Buying Company.
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You may now Pick, Pack, Ship, and Invoice the original Sales Order in Buying Company to the end customer.
SEE ALSO
Direct Purchasing
Purchase Item Master
Item Vendor Master
Product Master Direct Purchasing Tab
Sales Order Control
About SOAPI ("Sales Order Load Object")
Sales Orders Entry - Overview
