Internal Sales Order

Sometimes it is more cost-efficient to tranfer the inventory item from organization to another rather than buy an item from a supplier. As much as possible, company wants to save time and cost attached to the item. In this way, you are relieving the organization of the inventory cost for sale or product build. The question here is what if you want to tranfer your item from one inventory organization to another?

Internal Sales Order

This process is used when an organization has an item that is needed by another organization or business unit. It is important to know that Global or Multinational companies do optimize the value of the inventories especially if it is expensive or in bulk quantities. Rather than buying the item within the location, the organization will secure this item from another organization instead. In this case, the inventory of another organization will not get wasted and be used to build another unit (assembly item) or just simple for selling to an end customer.

This is a process involves 3 Oracle Application modules

Purchasing: this is the module where the requisition starts
Order Management: this is the module where the internal sales order gets created for release and shipment
Inventory: this is the module where the item is validated for reservation in pick release process. The item gets deduced from the inventory in shipping process

Note that this document only specifies the flow of the Internal Sales Order. Please refer to a separate document for set-ups that are required for this process to work.

Steps in Creating Internal Sales Order until Shipment
1. Internal Requisition
In this step, the following fields are filled up
Requisition Type
Buyer
Source Organization
Destination Organization
Destination Subinventory
Location
item information
i. item name
ii. quantity
iii. price
iv. item category

2. Internal Requisition Approval process according to Hierarchy

Once the Internal Requisition is created, the Submit button is pressed. The workflow approval process is kicked off invoking the routines that checks the Requisition Approval Hierarchy. According to the price and account range upon which the user’s group is registered to, the requisition will be verified. If it is within the approval limit of the user then the status will be set to approved. Otherwise, the system will check what the next approver in the hierarchy is. This process of going through the hierarcy will go on until the right authority to approve the amount and the GLA has been found.


3. Create Internal Sales Order process in Purchasing module
This is the concurrent process that is submitted in the Purchasing module that creates the records into the Order Header Interface and Order Line Interface tables (OE_HEADERS_IFACE_ALL, OE_LINES_IFACE_ALL).

4. Order Import process in Order Management module
This process validates the record that resides in the Order interface tables. After validating and the system found no error, new order record will be created and record in the Interface Table will be deleted.

5. Order booking process which can affected based on the credit checking rules
Depending on whether there are no problems with the item or whether the customer credit has no issue for the credit check rule, the order will get validated for booking.

The process of the internal sales order is the same as the standard sales order in some ways. The item’s availability is checked by the system after booking. If the item is available, the line status is moved to Awaiting Shipping and the item is ready for the next step. However, the status can also be Awaiting Shipping even if the item is not available. In this case, when the item is pick-released, the item status will be put on backorder. Even though the line status is Awaiting Shipping for both “Reserved” and line waiting for an item to be available, only the sales order line which is not reserved will appear in the Inventory Supply and Demand as not available.


6. Pick Release
The pick release process is when the item can be confirmed such that the item will be allocated for the order to be ready for shipment.

In the pick release process, the following are identified
a. Picked From Subinventory
b. Picked from Location
c. Picked from Organization
d. Order Number
e. Release Rule

7. Shipping
The shipping process is when the item gets deducted from the Inventory and the sales order quantity shipping is the quantity fulfilled. A new record in the AR Interface table will be created (RA_INTERFACE_LINES_ALL, RA_INTERFACE_SALESCREDITS_ALL).