Question

Which affects buyers more, the seller’s order cycle time or the seller’s order-to-cash cycle time? Support your answer.

Answer 1

The order cycle time affects the buyer more than the order to cash cycle time. Let us understand both the term briefly it will become easy to conclude the answer.

The seller’s order cycle time:

It is the time(in days), it takes for a seller to sell or use enough of a supplier’s products to fulfill the target order requirement. This process takes more time as more of human touch is involved. The more mechanized a system is the faster the work happens but here there are more nodes through which an order moves through. Here orders are received then inventory check is being done, enough safety stock is there or not is being confirmed, find out whether the order will lead to stock out situation or is it fine then the order is being accepted. Hence it's time taking process because after all these step checks only the order is confirmed.

seller’s order-to-cash cycle time:

Order to cash time refers to the set of business procedures involved for receiving and processing customer sales orders for goods and services and therefore the payment regarding the same. The order to cash cycle time begins with the system as soon as orders are being from the customer. These systems are said to be the core of a business and it has to be accurate and timely. If not managed efficiently there is a loss to the business.