The usual procedure for selling goods, known as Selling Routine, involves the following steps:
(i) Enquiry from the intending buyer: The process of sale starts with an inquiry by the intending buyer from the best available seller in terms of supply, price and quality of goods. This enquiry can be made from secondary sources like advertisements, in newspapers, market reports, catalogues, price lists, etc.
(ii) Providing quotation to the intending buyers: On receipt of an enquiry from the prospective buyer, the seller provides the required information known as quotation.
(iii) Receipt of order from the buyer: When the prospective buyer is satisfied with the terms and conditions of sale mentioned in the quotation, he issues a formal order to the seller for supply of goods. Order forms are sometimes printed by the buyer.
(iv) Execution of the order: On receiving the order, the seller usually acknowledges it and confirms its acceptance. If the order is executed at once then no confirmation is required. The order is then stamped with date of receipt, assigned a reference number and entered into the Order Received Register.
(v) Invoicing: An invoice contains details of the transaction and the amount to be received by the seller from the buyer. The seller sends the invoice along with the supply of goods to the buyer.
(vi) Opening Customer’s Account: When the copy of invoice is received by the accounts department, an account is opened in the ledger in the name of the customer. This account keeps a record of the invoice price of goods sold, credit allowed to the customers and payments made by him.
(vii) Dispatch of the goods: For release of the goods the godown or the production department requires a copy of the invoice or a delivery note from the accounts department, or both. Goods released are taken over by the packaging department where there is a final check that all goods are in accordance with the order.
(viii) Delivery of goods to the buyer: After receiving the railway receipt or transport receipt from the seller, the buyer takes delivery of goods from the railway or transport authority. While taking delivery the buyer or his agent must check the goods thoroughly.
(ix) Receipt of payment and settlement of accounts: The last step in the process is the receipt of the payment for goods sold. Payment is made according to the conditions agreed upon earlier. Remittances received are duly acknowledged and sometimes the sellers also issue periodic statements of account.
It shows the following items:
(a) The date of sale.
(b) The amount of goods sold.
(c) Payment received from the buyer.
(d) Balance due from the buyer.
(x) Rectification of errors: You have studied so far that the business transaction begins with the buyer’s enquiry about the goods to be purchased and completes when he finally settles his account with the seller. Even though the seller is very careful while sending goods and preparing invoices, there might be certain errors.
