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Implementing the SAP proof-of-delivery (POD) module can bring massive efficiencies to a company. Print E-mail
Written by Richard Dayman   
Surprisingly in 2008, we still see large companies who create high percentages of credit notes to invoice because they bill at the time an order leaves a warehouse, in other words at the SAP Post good issue step. This means any refused, damaged or short-delivered products require a credit note later.
This is often because a warehouse has always operated that way and the cost of change-management can be difficult to justify but also because Suppliers can be obsessed with “fast” Invoice creation and Sales recognition rather than “accurate” Invoice creation a few days later.

From the technical viewpoint the SAP POD module is extremely simple to implement. Importantly, it is easy to use & has strong standard reporting capability as well as add-on ALV reporting which can be downloaded to Excel & emailed & used for actionable Management reporting.

The two configurable areas are within Item categories and POD reason codes, which are free-format and up to a business to decide band-width. There is also a field in the Customer master data where a business decides which customers it wants to utilise the POD function. Once this is completed, an end-user can amend quantities on a delivery before they are billed to the Customer. This is normally a manual operation using sight of the signed delivery-note but it can also be automated, for example using a driver’s hand-held device to upload into SAP.

There are clear financial benefits to a Company in utilising the SAP POD module. First-time accurate invoices remove any need for a customer to delay payments. This means tangible improvements in the DSO & Receivables because invoices are not withheld for queries and debit notes aren’t received. Additionally there is the reduction in the workload and cost involved in reviewing & then processing customer’s claims – usually a debit note or deduction from a payment - through to creating a credit note. This can often involve support from a 3rd party logistics companies and can be a costly and lengthy process.

Measuring the accuracy of Suppliers invoices has long been a KPI for several of the larger Global retailers, but now we are seeing retailers using that KPI as a published cost-driver for them. Therefore accurate invoicing is a necessity for a Supplier; a USP or a “must-have” for FMCG suppliers who are serious about competing in every area of the Supply-Chain.
 

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