Back to Back (B2B) Order Cycle
A guide to procuring goods from suppliers only after a customer order is booked.
Back to Back Order Overview
The Back to Back (B2B) Order cycle is a powerful "just-in-time" fulfillment model. Unlike standard inventory management where goods are stocked in anticipation of sales, the B2B process triggers procurement only after a customer order is booked. This creates a direct link, or "peg," between the sales order and a corresponding purchase order, ensuring supply is acquired specifically for that demand. This minimizes inventory holding costs and is ideal for high-value or infrequently sold items.
Case Study: Selling a Specialized Server
Key Prerequisites
Define B2B Item
Items must be defined with 'Back-to-Back Enabled' checked on the Order Management tab.
Product Information Management > Manage ItemsDefine Sourcing Rules
Sourcing rules must be set up to define the supplier from which the item will be purchased.
Setup and Maintenance > Manage Sourcing RulesDefine Order Management Workflow
The OM order line workflow must be configured to progress the line to 'Awaiting Supply'.
Setup and Maintenance > Manage Orchestration Process DefinitionsCheck Item Attributes
The item must have 'Purchased' and 'Purchasable' attributes enabled on the Purchasing tab.
Product Information Management > Manage ItemsB2B Process Flow
Create & Book Sales Order
Progress Order
Run Requisition Import
Create & Approve PO
Receive Goods
Pick Release & Ship
Create AP & AR Invoices
Step-by-Step Breakdown
Create & Book Sales Order
Actor: Order Entry Clerk | Module: Oracle Order Management
The process starts with a sales order for an item that has been configured for "Back-to-Back" functionality. Booking the order is a crucial step that confirms customer demand.
Example: A customer orders a high-end, specialized server that the company doesn't stock. The order entry clerk creates and books a sales order for this server.
Navigation & Key Actions for Oracle Fusion
Navigation Path:
Order Management > Order Management > Create Order
Key Actions:
Select a Business Unit, enter Customer, and add the Back-to-Back enabled item. Click "Submit".
Progress Order
Actor: System / Order Manager | Module: Oracle Order Management
Run the "Progress Order" concurrent program for the sales order line. This critical step advances the workflow and flags the order line as eligible for purchasing.
Example: The "Progress Order" workflow activity runs, changing the line status to "Awaiting Supply". This signals the system to initiate the procurement process.
Navigation & Key Actions for Oracle Fusion
Navigation Path:
This is an automated step in the fulfillment orchestration process, managed by Supply Chain Orchestration (SCO).
Key Actions:
The orchestration process automatically creates a supply order in SCO, which is the link between demand and supply.
Run Requisition Import
Actor: System / Buyer | Module: Oracle Purchasing
The "Requisition Import" concurrent program reads the eligible order line data and creates a purchase requisition in the Purchasing module. This requisition is now hard-pegged to the sales order.
Example: The Requisition Import program finds the flagged sales order line and creates a new purchase requisition for one unit of the specialized server.
Navigation & Key Actions for Oracle Fusion
Navigation Path:
Scheduled Processes > Schedule New Process > "Generate Supply Orders"
Key Actions:
The "Generate Supply Orders" process creates the Purchase Requisition based on the supply order data from SCO.
Create & Approve PO
Actor: Buyer | Module: Oracle Purchasing
The requisition is converted into a standard purchase order, either manually via AutoCreate or automatically. The PO is then approved and sent to the supplier.
Example: A buyer reviews the requisition, converts it into a Purchase Order using the AutoCreate form, and sends it to the server hardware supplier.
Navigation & Key Actions for Oracle Fusion
Navigation Path:
Procurement > Purchase Orders > "Process Requisitions" task
Key Actions:
The buyer selects the requisition line in the Process Requisitions work area and adds it to the document builder to create the PO.
Receive Goods
Actor: Receiving Agent | Module: Oracle Purchasing / Inventory
The supplier delivers the goods. The receiving agent creates a receipt in Oracle. The system automatically reserves the received stock specifically for the linked sales order.
Example: The server is delivered to the warehouse. The receiving agent creates a receipt. The system sees the "peg" and immediately reserves the server for the customer's sales order.
Navigation & Key Actions for Oracle Fusion
Navigation Path:
Supply Chain Execution > Receiving > "Receive Expected Shipments" task
Key Actions:
Search for the PO, enter the quantity, and create the receipt. The system automatically reserves the stock.
Pick Release & Ship
Actor: Shipping Clerk | Module: Oracle Shipping Execution
The reserved inventory is now ready. The sales order is pick-released, and the goods are picked, packed, and shipped to the customer just like a standard order.
Example: The shipping process now proceeds as normal. The sales order is pick-released, and the now-reserved server is picked from inventory and shipped to the customer.
Navigation & Key Actions for Oracle Fusion
Navigation Path:
Supply Chain Execution > Shipping > "Manage Shipments" > Ship Confirm
Key Actions:
Create and confirm a pick wave, then query the shipment and ship confirm.
Create AP & AR Invoices
Actor: AP & AR Accountants | Module: Payables & Receivables
Finally, an AP invoice is created in Payables to pay the supplier for the goods. In parallel, an AR invoice is created in Receivables to bill the end customer.
Example: The accounting department creates an AP invoice to pay the server supplier and an AR invoice to bill the customer who originally ordered the server.
Navigation & Key Actions for Oracle Fusion
Navigation Path:
Payables > Invoices > "Create Invoice" | Scheduled Processes > "Import AutoInvoice"
Key Actions:
Create AP Invoice and match to PO. Run Import Autoinvoice for AR.