Understanding Sales Quotation Process


After completing this lesson, you will be able to:

  • Describe Sales Quotation Process
  • Generate Quotations

Business Process Overview

A quotation can be created directly in the system, or alternatively with reference to a sales inquiry. The quotation enables you to provide your customer with a legally binding offer for the delivery of goods or services subject to certain fixed conditions.

The use of quotations is not mandatory for the sales process.

Sometimes, the customer may not like the price or terms offered in your quotation, and decide to purchase from another supplier. In this case, the quotation will not be referenced by a sales order and hence remains open in your system. There are several options available to resolve this situation. Use of a reason for rejection (entered at item level) is a common way of setting the status of a quotation to complete.

When you use a reason for rejection (such as "too expensive" or "delivery date too late"), you also store valuable information in the system that can be used to analyze sales opportunities.

The figure, Sales Quotations, shows the concept of quotations.

The figure, BDG – Sales Quotation, shows the process diagram for scope item BDG, Sales Quotation.

The following are the main steps in the process:

  1. In the Create Sales Quotation step, you enter the sales quotation after a customer requests it.

  2. Then, depending on the customer's decision, the following outcomes are possible:

    • The customer requests changes to the quotation.
    • The customer declines the quotation, in which case we reject it (using a reason for rejection).
    • The customer accepts the quotation and wishes to place an order.

A quotation item is not given "Completed" status until the complete quantity in the item has been copied to a subsequent order (or orders). If only some of the quantity is copied, the quotation item is given the status "Partially Referenced". This allows you to continue creating orders from this item until the total quantity has been referenced.

Tutorial: Sales Quotation (BDG)

This scope item starts when requests for quotations (RFQ) are received from customers.

Quotations are created in the system, and can be either accepted or rejected by customers.

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