Delivery of Goods The salesperson will send the

Delivery of Goods
The salesperson will send the (Pick Note/ Picking List) to the Warehouse Department via the sales system when goods are to be delivered to the customer. The Warehouse Department will be automatically notified when the Pick Note is released. The Warehouse Department will initiate the printing of Pick Note from the system and 3 copies of Pick Note will be printed out. The warehouse staff will indicate the items and quantity picked on the Pick Note and sign on it. After the Warehouse Department has picked the goods, the goods will be delivered to the outbound area together with the Pick Notes. The Pick Note will be signed by the warehouse security when the goods leave the warehouse. The goods will then be released to the outbound area and the Export Department will sign on the Pick Note to acknowledge the receipt of goods from the Warehouse Department.

The original copy of Pick Note will be then be passed to the salesperson. The salesperson will update the items and quantity picked as indicated in the Pick Note into the system to generate the Delivery Order (DO). Individual salesperson will also need to update the Customer Shipment Checklist to track the date for Pick Note received from warehouse. The salesperson will then print 3 copies of DOs. After DO has been signed by salesperson, the DO will be handed to the export department to pack the goods. Salesperson will need to update the Customer Shipment Checklist to track the date of DO/Packing List (overseas sales) to the export department.

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!

order now

After the goods are delivered to the customer, customer’s acknowledged DO will be handed over to the Sales Department to issue invoice to the customer. Inventory is deducted from the system when invoice is raised after receiving the acknowledged DO.

Receipt of Goods
The Warehouse Department will acknowledge receipt of the goods on the Delivery Order (DO) when goods are delivered to the warehouse. The DO will then be passed to the Purchase Department who will generate and print out the Goods Received Note (GRN) based on approved Purchase Order (PO) and pass the GRN to another warehouse staff who will check the item description and quantities of goods received against the GRN. In the event that the quantity delivered is different from the PO, the Purchasing Department will raise a Goods Return form in the system and this will reduce the amount in the PO and GRN.

The Warehouse Department will reprint an updated GRN with the same GRN number. The Warehouse Department staff will sign on the GRN after inspection that goods are received in good order. The Warehouse Department will then pass the GRN to the Purchase Department who will transfer the GRN to inventory status in the system upon receipt of confirmation from Warehouse Department that goods are received in good order and condition. The Purchase Department will also monitor the receipt of original supplier’s invoices. The supplier’s invoices, DO, GRN and PO will then be forwarded from the Purchase Department to the Finance Department.

KCH’s policy in assessing allowance for slow-moving stocks is to identify stock items that are aged more than 4 years and requires more than 15 years’ time span for the stock to be completely sold. The 15 years future sales projection is based on the past 2 years sales trend extrapolated forward on a straight-line basis. All identified stock items, excluding those that are less than one year old, that are projected not to be sold beyond the next 15 years, will be fully written down.

General provision for stocks is provided every month based on stock aging report extracted by MIS Department. Every half-yearly, on September and March, KCH will reverse out the general stock provision provided up to date and make specific provision for the inventory. The specific provision will be made based on an inventory report generated by the (MIS) Department (IT Department). Noted that once a specific provision is made, it will not be reversed out unless the inventory is sold subsequently or written off.

Customer Services Strategy
1. Credit Control

New Customers

New customers are on cash term basis unless approve by the management. New customers can apply for credit facilities by filling up the Application for Credit Facilities form which requires them to disclose some sensitive information e.g. names of bankers, names of other suppliers, expected purchase amount, etc and agree to the terms and conditions attached to the credit facilities.
Upon receiving the completed form from the customer, the respective sales staff and sales manager in charge needs to sign on the recommendation page which indicate how much is the credit limit that should be granted and the credit term. The completed form will then be forwarded to Hui Shan (Accounts Assistants) who will ensure that the required information has been provided and proceed with the approval process. Approvals need to be obtained from management.
Subsequent Changes to Credit Limit
Existing customers can request for a change in credit limit or credit terms by filling up the Application for Changes in Credit Limit/ Credit Term/ Payment Mode form. The company will assess the transaction history of the customers for the past 6 months prior to approving the application.

However, when the customer is a subsidiary or a related company of a long-standing client, the change in credit limit or terms might be granted to them without having 6 months transaction history. This decision is at the discretion of the management. The proposed limit/ term/ mode must be approved by Accounting Manager and counter-approved by either (Managing Director) or (General Manager).

Releasing of Suspended Order due to Credit Limit Exceeded
As mentioned in section 1 above, prior to converting the quotations in the system to sales order, the sales staff is required to check whether the credit limit will be exceeded once the new order is made.
If the credit limit will be exceeded, the sales staff can put up a request through the system for temporary release suspended order due to credit limit exceeded. Note that this is still subject to the approval of Accounting Manager and either Managing Director or (Senior Ops Manager) or (Sales Manager).