Brewing Success: Streamlining Coffee Bean Subscriptions with Sales Orders, Purchase Orders, and Bluefort’s LISA
by Warwick Swain, Business Consultant at Bluefort
Subscriptions are everywhere – from streaming services to monthly subscription boxes for coffee lovers. For companies managing recurring subscriptions across multiple entities, like a coffee company with a dedicated roasting subsidiary, the process goes beyond simply delivering coffee beans. Behind the scenes, sales orders and purchase orders work in tandem to fulfil these monthly subscriptions, creating seamless intercompany processes.
With solutions like Bluefort’s LISA for subscription management, these processes become even more efficient, especially in an intercompany setting. Today, let’s explore how sales orders and purchase orders work together in a coffee subscription model and how Bluefort’s LISA simplifies the flow.
Coffee Subscription Basics: Sales Orders and Purchase Orders
At the heart of any intercompany subscription model are sales orders (SO) and purchase orders (PO). Think of a coffee subscription: every month, customers expect a fresh bag of coffee beans. To meet these expectations, coffee companies need to manage internal orders and logistics between their customer-facing entity and their roasting subsidiary.
In an intercompany setup, this means:
- The customer-facing company generates a purchase order to request coffee beans from the roasting subsidiary.
- The roasting subsidiary generates a sales order in response to the purchase order, confirming that it will roast, package, and deliver the beans.
This structure keeps both entities aligned and ensures accurate inventory, timely deliveries, and streamlined financial records.
Step-by-Step Coffee Subscription Process with Intercompany Orders
Let’s break down the coffee subscription workflow to show how the purchase order (PO) and sales order (SO) processes keep everything flowing smoothly.
Step 1: Customer Signs Up for a Coffee Subscription (Purchase Order Creation)
The customer subscribes to a monthly delivery of freshly roasted coffee beans. This order signals the customer-facing coffee company to place an internal purchase order with its roasting subsidiary.
- In the coffee subscription model, this internal PO specifies coffee preferences, bean types, and delivery schedules. It acts as a formal request to the roasting subsidiary to prepare the coffee beans, ensuring timely fulfilment.
Step 2: Roasting Subsidiary Generates a Sales Order
Once the roasting subsidiary receives the purchase order, it creates a sales order (SO) in response. This document confirms the details of the customer order, including the variety of coffee beans, the quantity needed, and the upcoming delivery dates.
- The sales order ensures the roasting subsidiary understands what to prepare each month, so the main company’s customer orders can be fulfilled on time. This intercompany SO-PO relationship allows the two entities to stay aligned, working like gears in a well-oiled machine.
Step 3: Roasting and Packaging of Coffee Beans
With the sales order in place, the roasting subsidiary begins the roasting and packaging process, ensuring each batch meets the specified quality and flavour profile. This step is where the roasting subsidiary gathers raw beans, roasts them to perfection, and packs them according to customer preferences.
- The roasting subsidiary’s internal processes mirror a commitment to quality and consistency, just as the SO and PO documents mirror each other, ensuring that each entity stays updated and financially aligned.
Step 4: Fulfilment and Delivery
After roasting and packaging, the beans are either shipped to a fulfilment centre or delivered directly to the customer, depending on the company’s setup. This fulfilment completes the monthly order cycle for the subscription.
- With each fulfilled delivery, the sales and purchase orders are matched up to track inventory, financials, and customer satisfaction. The roasting subsidiary’s internal sales order is reconciled with the customer-facing company’s purchase order, keeping both entities synchronized.
Step 5: Monthly Billing and Financial Reconciliation
The beauty of a subscription model is the recurring billing that follows each month. The customer-facing coffee company charges the customer for their monthly subscription. Internally, the roasting subsidiary charges the customer-facing company for the roasted beans, creating a recurring intercompany transaction.
- Each cycle’s financials are balanced to reflect the revenue earned by the customer-facing company and the roasting costs covered by the roasting subsidiary. By maintaining accurate intercompany records, this step supports the entire subscription model’s financial health.
Enter Bluefort’s LISA: Automating the Subscription Lifecycle
If manually handling intercompany transactions sounds complex, that’s because it is. This is where Bluefort’s LISA subscription management shines. Built for Microsoft Dynamics 365, LISA automates the recurring billing, fulfilment, and financial reconciliation processes. Here’s how LISA simplifies each part of the subscription lifecycle in a coffee subscription model.
- Automated Synchronization of Sales Orders and Purchase Orders
LISA automatically generates and synchronizes sales and purchase orders across entities. Instead of manually inputting each order, the coffee company’s customer-facing entity can rely on LISA to seamlessly transfer order data to the roasting subsidiary, preventing errors and saving time.
- Recurring Billing and Revenue Recognition
LISA automates the monthly billing cycles, ensuring that each entity receives its due share of revenue and expenses accurately. For instance, the roasting subsidiary’s SO and the main company’s PO are synchronized, ensuring both entities are credited appropriately. The system’s revenue recognition features simplify intercompany accounting, reducing manual interventions.
- Subscription Lifecycle Management
From initial sign-up through recurring renewals, LISA manages customer preferences, scheduling, and financial reconciliation for each subscription cycle. Changes to the customer’s preferences, order quantities, or billing are instantly reflected in the intercompany systems, keeping the subscription process smooth and agile.
Streamlining Subscription Success with LISA
The journey from bean to brew, or from sales order to purchase order, requires coordination and efficiency. The sales order-purchase order process in a coffee bean subscription model illustrates just how crucial it is to align operations between entities, especially for companies managing recurring subscriptions.
By automating these processes, Bluefort’s LISA makes it easier for companies to offer exceptional subscription services with a fully connected, intercompany ecosystem. In doing so, LISA not only keeps coffee flowing but also keeps the entire operation running as smoothly as a perfectly roasted cup of coffee.
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