The ultimate guide to managing your sales orders effectively

Closing a deal and receiving the purchase order is a milestone in the sales process. But what happens next? How do you ensure the requested goods or services get delivered on time, and the appropriate invoice gets raised?

It all boils down to the sales order. And, more importantly, how efficiently you manage the sales order process.

In this guide, we’ll define sales orders and explain how they dovetail with other sales-related documents, highlight the benefits they can bring to your business, and show you how to streamline your sales order process with monday CRM.

What is a sales order?

A sales order is a document a seller (vendor) creates to confirm and process a customer’s purchase order. Typically, it includes the order number, customer and vendor information, product details, pricing, and delivery information. It’s used internally by the seller to approve credit, update inventory, initiate production/fulfillment, and generate the final invoice.

What is the sales order process?

The typical sales order process flow is as follows:

1. The customer submits a request for a quote (RFQ) to the vendor.
2. The vendor sends a quote with pricing and terms.
3. The customer sends a purchase order accepting the quote.
4. The vendor creates a sales order confirming the purchase order details.
5. The customer receives the goods or services.
6. The vendor sends an invoice requesting payment from the customer.
7. The customer makes payment per invoice terms.
8. The vendor sends a receipt confirming payment.

What’s the difference between sales orders and other sales documents?

A sales order is just one of the documents used by both parties in the sales process, alongside quotes, purchase orders, and invoices. Here’s how they differ:

Sales orders vs. quotes

A quote is an estimate or proposal the seller sends to a potential buyer, outlining the proposed products/services and pricing. It’s used to solicit interest from the buyer and negotiate terms before the buyer places an order.

Unlike sales orders, quotes do not impact inventory and do not appear in production/fulfillment views. At this stage, the seller focuses on getting approvals from the buyer.

Sales orders vs. purchase orders

Although sales orders and purchase orders contain similar information, the key difference is the issuing party — the buyer issues the purchase order, and the seller issues the sales order.

The buyer issues a purchase order (PO) to the seller, indicating the products/services they want to purchase along with quantities, prices, and terms. Once accepted by the seller, it serves as a legally binding contract, committing the buyer to pay for the order.

The seller issues a sales order (SO) to the buyer in response to the purchase order, confirming acceptance of the purchase order terms.

Sales orders vs. invoices

A sales order precedes and confirms the sale before fulfillment.

After the order is fulfilled, the seller issues an invoice requesting payment from the buyer. Since it represents a financial transaction, the seller must record the invoice in their accounting system.

In addition to the sales order details, the invoice includes the payment due date, unique invoice number, and late fees (if applicable). It serves as legal proof of the completed transaction and the buyer’s payment obligation.

So, in summary:

• A quote is an estimated price sent to solicit buyer interest.
• A purchase order is a legally binding document from the buyer.
• A sales order confirms the seller’s acceptance of the purchase order terms.
• An invoice requests payment after the sales order is fulfilled.

What are the different types of sales orders?

There are several different types or categories of sales orders based on payment terms, delivery timelines, and sales channels:

1. B2B (Business-to-Business) sales orders: Generated by a business selling products or services to another business. These can be further categorized into:
   • Supply sales orders: For selling supplies — e.g. office supplies, cleaning supplies, etc. — needed to run other businesses.
   • Distribution sales orders: For selling products — e.g. groceries, pharmaceuticals, etc. — to distributors who then sell to consumers.
2. B2C (Business-to-Consumer) sales orders: Created by businesses selling directly to individual consumers. B2C sales orders focus more on brand, pricing, and emotional factors than B2B orders.
3. Product sales orders: For physical, tangible products that need to be manufactured, assembled, or shipped from inventory.
4. Service sales orders: For services (tangible or intangible) the seller provides to the buyer, such as consulting, software, and maintenance.
5. Cash sales orders: For orders where the customer pays immediately in cash and takes delivery right away.
6. Rush orders: For orders that need to be fulfilled on the same day or in a shorter than usual lead time.
7. Scheduling agreement orders: For orders that indicate a schedule for delivery of specific quantities over a given period.
8. Third-party orders: For orders where delivery to the customer comes through a third-party vendor.

What are the benefits of sales orders?

While sales orders may seem like just another step in the sales process, they can also increase operational efficiency through accuracy, inventory control, cost savings, and customer service improvements, ultimately driving higher productivity and profitability.

Here are the key benefits of using sales orders:

Reduced errors and increased accuracy

Sales orders provide an opportunity to double-check details like quantities, pricing, and terms before fulfillment, reducing the risk of human errors. Plus, automated sales order processing minimizes manual data entry errors, increasing order accuracy.

Improved inventory management

Sales orders maintain records of inventory levels and status, allowing better tracking of products in stock and on backorder. This helps avoid stockouts and overbuying and optimizes inventory levels.

Streamlined order processing

Sales orders initiate and streamline each phase of the order fulfillment process, such as picking, shipping, and invoicing. Automation condenses order cycle times by over 45% on average — from 8.6 hours down to 4.6 hours — enabling faster fulfillment.

Cost and time savings

Automating sales orders dramatically lowers processing costs by up to 67% compared to manual methods. It eliminates redundant tasks, saves employees’ time, and increases productivity.

Improved customer service

Faster, error-free order processing enhances the customer experience and satisfaction. Real-time order status updates and quicker fulfillment improves communication with customers.

Better accounting and cash flow

Sales orders are critical documents for accounting, allowing order matching and organized books. Faster invoicing after automated sales order processing improves cash flow, and can be done easily and efficiently on a purpose built platform such as monday CRM.

What should your sales order contain?

Having a clear, detailed sales order form streamlines your workflow. Typically, it includes the following key elements:

• Company information: Your company name, logo, address, and contact details.
• Customer information: The customer’s company name, contact person, and billing and shipping addresses.
• Purchase order (PO) details: Reference to the buyer’s PO number and date (if applicable).
• Order date: The date the order is raised.
• Product/service details: Item descriptions, quantities, unit prices, and specific conditions or requirements.
• Pricing information: Subtotals for each line item, plus additional charges like taxes, fees, or discounts.
• Delivery/shipping details: Shipping method and expected delivery date(s).
• Payment terms: Accepted payment methods and due dates for credit terms.
• Other terms and conditions: Return/refund policies and contract duration if applicable.
• Approval section: Space for signatures/names of involved parties to approve the order.

The format typically has sections to capture the seller and buyer company information at the top, followed by tables to list the product/pricing details. It concludes with sections for delivery, payment terms, signatures, and any other relevant terms and conditions:

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Best practices for managing your sales orders with monday CRM

Built on monday.com Work OS, monday CRM enables businesses to manage sales orders through pre-built boards, automation capabilities, system integrations, real-time tracking, and centralized customer data — ultimately streamlining and optimizing the entire sales cycle in one place.

Here are some best practices for effectively managing sales orders with monday CRM:

1.  Utilize the pre-built boards

Workspaces in monday CRM come loaded with pre-built boards designed specifically for managing the entire sales order process. They include views to track order details like customers, products, quantities, pricing, status, and tasks. Plus you can easily customize them — without the need for development — to fit your business workflows and requirements.

2. Automate sales order workflows

Automations on monday CRM help minimize manual efforts, reduce errors, and ensure timely actions. You can set up custom automations to streamline order management processes, such as notifying team members when an order needs attention, updating an order status based on conditions, and sending order confirmations to customers.

3. Stay one step ahead with AI

Use the built-in AI tools to quickly compose emails, refine messages, or create polished content for every step of the sales cycle that hits just the right note, every time. These powerful tools can also help calculate the close probability of your deals, no previous expertise in formula building required.

4. Integrate with other systems

With monday CRM, you can connect with other apps you already use, such as accounting software like Xero and Sage and communication tools like Slack and Gmail. These integrations enable data to flow automatically between systems — like syncing sales orders to accounting for invoicing — and provide a unified view of customer data and order status across departments.

5. Track order status in real-time

Within monday CRM, you can easily track the real-time status of sales orders as they progress through stages. All stakeholders have visibility into up-to-date order details, communications, and next steps.

6. Centralize customer data

By managing sales orders in monday CRM, you get a complete view of customer information and purchase history in one place, so you can analyze buying patterns and improve sales strategies. No more working with endless screens and fields — save time by defining, collecting, and organizing the exact sales data you need.

Streamline your sales order process

Sales orders are the all-important lynchpin between a buyer’s purchase order and the seller’s invoice. They ensure everything on the customer’s wishlist gets delivered on time, and with an automated system, they can make sales operations more efficient.

Using monday CRM, you can streamline your entire sales order process even more by connecting your customer information with your sales order management system, so everyone knows precisely what’s happening in real-time.

Try monday CRM today with a 14-day free trial.