Introduction: Sale Pending Work Orders

Overview

When products that require service or installation are sold to a customer (e.g. a home theater system), it may be beneficial to have the associated labor and parts costs appear on the original sales transaction.

The Sale Pending workorder type is used for this purpose.

By attaching the workorder to the original Delayed Delivery (DD) transaction via a Non-Inventory Interface Item, the costs associated with the service/installation are written back to original sales ticket (which are viewable on the Sales Transactions Audit). This allows you to account for revenue and costs at the same time. You also have the option to move the lines from the work order to the DD transaction.

There are three different Sale Pending methods. You can use the same method for all Sale Pending transactions processed by your company or you can select a method based on the specific needs of each customer and transaction. You can also combine steps from one or more of the methods to customize the process for your company.

Questions to Consider

The following questions will help you determine the method that you should choose for a Sale Pending transaction:

Is installation a long-term or short-term project?
Are there multiple technicians that need to track actual hours (for reporting purposes)?
Will the purchased merchandise be delivered separately by the warehouse or taken with the installer?
When and how do you want to see the financials affected for costs and revenue of both merchandise and the installation (labor, parts)? This is especially important for long term projects.
How should the marginal analysis reports be broken out? Should Product Types and Items appear separately?
Who is entering and attaching the workorder to the DD transaction?
Who is maintaining the workorder after the installers complete jobs?

Method 1A

This method is used for short-term installation jobs that require a single trip to the customer’s business or residence.

With this method, only one Non-Inventory interface item is included on the DD transaction. When the workorder is attached to the sales ticket in Service, all parts and labor costs are written to the interface item on the DD transaction. Multiple labor lines with multiple technicians are allowed, along with multiple parts lines. Routing, with start and stop times, is also available.

Since this method assumes that your company knows the amount of revenue required to cover costs and profit, money is collected from the customer upfront. If necessary, you can accrue additional charges after the fact.

Method 1B

This method is used for long-term installation jobs that require multiple trips to the customer’s business or residence.

With this method, multiple Non-Inventory Interface Items are included on the DD transaction–one for each job (pre-wire, install, cleanup). This allows you to create a separate work order for each job and attach it to the corresponding interface item on the DD transaction. When this happens, parts and labor costs are written from the work order to the interface line on the DD transaction. Multiple labor lines with multiple technicians are allowed on each work order, along with multiple parts lines. Routing, with start and stop times, is also available.

Revenue and costs of merchandise inventory, labor, and parts are captured as they incur. This maintains a streamline of revenue versus costs for both financials and marginal sales reports. It can also help when booking costs for payroll within the same time period (for jobs and trips being completed).

Method 2

This method is used for long or short-term installation jobs that require multiple trips to the customer’s business or residence.

With Method 2, you will move all lines from the work order(s) to the DD sales transaction (as separate detail lines). This allows the charges to the customer and the costs for all labor and parts to be accessible in one place. Additionally, it allows an A/R balance to accrue for the customer.

When lines on the DD transaction are shipped and updated while the job is still in progress, A/R, financials and marginal sales reports are updated. Statements can be mailed monthly as these charges incur.

Multiple labor lines with multiple technicians are allowed, along with multiple parts lines. Routing, with start and stop times, is also available.

If the amount is known, money can be collected from the customer upfront. However, the customer must understand that additional charges may incur.