Sales orders or purchase order are essentials for all businesses dealing in prod

Question

Sales orders or purchase order are essentials for all businesses dealing in products and services. A company can face various threat to its sales orders.

Unpaid Order / Delinquency  : This is a scenario where accounts receivable was supposed to receive a payment which is long over due. This is normally seen in creative fields , supply chain and vendor management. B2B suppliers often ship their products or services to vendors prior to getting paid. The businesses accounts payable then has to process the payment based on their own payout cycles in the firm. However sometimes these payment cycles can take longer than expected and the B2B supplier or vendor faces holding costs and has blocked his or her capital and supply.

Over Supply / Excessive Inventory : This tends to occur when a company either gets its production forecasting wrong or when the consumer or the business that they're dealing with has over given incorrect estimates of their demand and then changed that amount during the purchase or the sales order.

Under Supply / Lack of Inventory : This is just the opposite of over supply or excessive inventory. This is a scenario where the supplier or a company is unable to fulfil their purchase order or their sales order because of a lack of inventory in their warehouse.

A good example for Under Supply / Lack of Inventory would be a company called Summer Grills Inc

Summer Grills Inc had a problem with maintaining inventory and keeping up with the current demand of electric

barbecue grillers . Its current inventory levels were not sufficient for it re sellers and or dealers. Complaints were were being logged by dealers across the country about the lack of inventories. This resulted in delayed deliveries which was a problem for resellers and customers since they had already blocked their money in down payments and instalments for bulk orders were still being unproductive because of the disruption in their supply chain.

Orders which get processed incorrectly / Returns : This is a common scenario in e commerce companies and in warehouses of large companies with a huge inventory. Many of these companies process orders incorrectly.

Explanation / Answer

what are Sales order threats can be faced the company and elaborate them!

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