4-1 Warehouse Receipt Invoicing Over
Warehouse Receipt Invoicing Overview
Table of Contents
Warehouse Receipt Invoicing Overview 2
Warehouse Receipt Invoicing Overview
Overview
In a typical 3rd party logistics operation, charges are levied at the time that goods are received at the warehouse. These charges are based upon rate structures that were negotiated by contract. The charges vary by customer and can be based on a number of different SKU's, weight, cubic feet, cartons, pallets, etc. Charges usually include a storage and a handling component and may include charges for special services. These charges may be invoiced per shipment or can be summarized on either a summary receiving invoice or added to the accessorial invoice.
During the entry of each receiver, the type of rates that apply to the receipt can be specified. WDLS will apply the default rates and regular handling rate unless specific entries are made. These entries allow you to record no-charge receivers (such as stock transfers within your facilities) and identify that only handling or storage charges are to apply. They also allow you to establish and apply special handling rates for special conditions such as un-palletized loads.
Storage Charges
One of the components that makes up the charge for receiving goods is the storage charge. Different pricing models prevail in difference industries. WDLS supports pricing models where storage is charged in advance at the time of receipt and it supports pricing models where a grace period is defined and storage charges are not levied until the grace period is exceeded. During account setup, rates and bases were established at the account or alternately at the item level. The receiving storage charge rate and basis are used to calculate these charges. Unless a grace period is defined, the charges are calculated at the time of confirmation of the receipt. The rate and basis is multiplied by the basis quantity actually received at the item/lot level. Note that this is not necessarily at the line level of the tally. If two or more lines exist for the same item/lot combination, they are summarized before the rate is applied. Paperwork varies significantly by client, but whether the tally contains 1 line per pallet or a line with 3 pallets, the calculation should be the same.
Generally speaking, charging rounds up. If the basis is by the pallet, any fraction of a pallet counts as 1 pallet. Hundred weight is the exception, since industry practice is that 68 lbs is billed as .68 of a hundred weight. WDLS uses 2 decimal points of precision for these computations. For each item listed on the warehouse receipt invoice, the storage charge, rate, and basis will be listed.
Mid-Month Cutoff
When the receipt is confirmed, WDLS checks to see if the receipt is in the beginning or the ending part of the period. At the storer level a cutoff date can be specified either as an actual day of the month or as an offset to apply to the start of the period. An actual day is typically used if the account closes on standard monthly periods. In that case, the 15th of the month might be chosen. On an odd-closing account (such as an account that opts to close on the 2nd Friday of each month) the mid-month cutoff will float and be set as say 15 days from the start of the period.
The storage fee is calculated when the receipt is confirmed. If it is in the beginning and a mid-month cutoff is specified, a full period's storage is charged. If it is in the latter part of the period, a half period's storage is charged. At the time of the calculation, WDLS will charge for .5, 1, 1.5, or 2 periods of storage. The second factor is whether the receipt is being back-posted to a period already billed for storage. When this is the case, one extra period's storage is added to the calculation.
Handling Charges
WDLS supports three different rate structures for handling: regular, distribution, or alternate. During the entry of the receipt, one of these three is selected to apply to the lines of the receiver. The rates and bases for each of these handling charges are typically set during the initial account setup. The charges are typically set up at the account level, but can be overridden for particular items with special requirements. By utilizing the three different rate structures, it simplifies the process of billing for a mixture of receiving practices such as regular palletized loads from the manufacturer, customer returns, and cross docking. As with storage charges, handling is charged by applying the specified rate and basis against the basis quantity of each item/lot combination on the receipt. The same rounding rules, as used on storage charges, apply. Handling charges are not subject to the mid-month logic that is used to calculate storage.
Charge Minimums
During contract negotiations you may have established a minimum charge for various services. Minimums are used to ensure you get adequate revenue to cover the handling costs of small shipments or shipments containing many SKU's. WDLS supports minimums at the lot, item, and total receipt level.
Lot minimums help you to recover the costs of handling date coded or sorted product. When your client requires you to track items by lot to support shelf life or product recall, your efforts increase almost to that of maintaining separate SKU's. Lot minimums help you mitigate the costs of receiving tiny quantities with mixed code dates. Item minimums allow you to accomplish the same at the item level. Receipt level minimums are used to ensure that your costs of receiving a shipment are always covered, regardless of how little product was involved. You may determine that it costs $75 to back a truck up to a dock, open it, determine what is on it, unload it, and free the dock space, even if there is only one case on the truck. The receipt minimum can be used to ensure that this minimum is charged.
Lot, item, and receipt minimums can supersede one another. You could have a small quantity of a lotted item which results in a lot minimum. If that was the only lot for the item, the item minimum might be applied. If the total on the shipment does not reach the receipt minimum, that would then apply.
Special Charges
During contract negotiations you may have established a minimum charge for various services. Minimums are used to ensure you get adequate revenue to cover the handling costs of small shipments or shipments containing many SKU's. WDLS supports minimums at the lot, item, and total receipt level.
Lot minimums help you to recover the costs of handling date coded or sorted product. When your client requires you to track items by lot to support shelf life or product recall, your efforts increase almost to that of maintaining separate SKU's. Lot minimums help you mitigate the costs of receiving tiny quantities with mixed code dates. Item minimums allow you to accomplish the same at the item level. Receipt level minimums are used to ensure that your costs of receiving a shipment are always covered, regardless of how little product was involved. You may determine that it costs $75 to back a truck up to a dock, open it, determine what is on it, unload it, and free the dock space, even if there is only one case on the truck. The receipt minimum can be used to ensure that this minimum is charged.
Lot, item, and receipt minimums can supersede one another. You could have a small quantity of a lotted item which results in a lot minimum. If that was the only lot for the item, the item minimum might be applied. If the total on the shipment does not reach the receipt minimum, that would then apply.
Invoicing
There are three basic methods of invoicing these charges within WDLS. You can invoice by each individual tally, invoice for all inbound receipts within a date range, or add the inbound charges to the rest of the accessorial charges and invoice by period. The three options are accomplished by a combination of setup steps and operational procedures. Several options exist to control the level of detail printed on the storage invoice. These range from lot level charge detail, to item level, to a summary by basis unit.
The WRINVOICE exit point determines if you want to post each receipt for an account or summarize the inbound charges. If the latter is chosen, you can either create a summary inbound invoice by date range or let the charges accumulate and appear on the accessorial invoice. Different accounts and operations have different requirements. In all cases, the charges are calculated when the receipt is confirmed.