The Trading Cycle All businesses create income through sales and generate profits through managing income and costs and realise those profits in the form of improved company net worth which includes cash in the bank, increased debtors, more assets.
This ongoing process whereby a sale is made, incurs costs and generates profits and improved net worth is known as the Trading Cycle of a business.
The Sales Cycle
Typically, customers who require your goods and/or services might contact you for a quote. If this quote is acceptable, they will place an order.
You will match this to your inventory records and advise the customer of the delivery date.
The details on the order will be passed to the despatch department and will be picked, packed and despatched in accordance with your customer’s instructions.
Once goods are despatched or services are supplied, you will generate a sales Invoice, send this to the customer, and subsequently collect the money.
This ongoing process is known as the Sales Cycle.
Most Prelude Desktop products include an integrated Sales Order Processing module.
Once activated, the Sales Order Processing module processes sales transactions from quote through to cash collection. You can configure the module to match existing processes, and track orders through a comprehensive suite of reports. See Sales Order Processing for more information.
The Purchase Cycle
In order to generate income, each business needs to obtain goods and/or services from third parties outside the business.
The suppliers will invoice your business for these goods and/or services and will expect payment in return.
This process can be called the Purchase Cycle.
Most Prelude Desktop products also include an integrated Purchase Order Processing module.
Once activated, the Purchase Order Processing module processes purchase cycle transactions from order through to payment. In Prelude Desktop products Purchase Order Processing connects seemlessly with the Stock Control and Sales Order Processing modules to provide an extremely powerful tool to help manage Working Capital. See Purchase Order Processing for more information. Also see S.C.M.