Split Parent Despatch Orders

Overview

A split parent despatch order (SPDO) can be created to split a single despatch order for logistics (that is, for the loading and assaying processes) into multiple despatch orders for marketing (for example, to have separate invoicing or shipment documentation).

Nevertheless, the configuration for SPDOs (see Configuration for Split Parent Despatch Orders) allows for the despatch orders to be invoiced together or separately. Even if invoiced together, the pricing and other invoice line items are calculated based on the contract terms applicable to each despatch order.

SPDOs can be used for two different scenarios:

  1. The required quantities for each child despatch order (CDO) are known in advance
  2. For cumulative pricing, where a single SPDO is automatically split into CDOs, each with a different quotation pricing line for invoicing

Child Despatch Orders With Known Quantities

Creating an SPDO involves setting configuration options and selecting despatch orders to be the child despatch orders (CDOs). The despatch orders that will become the CDOs of the SPDO must already exist in MineMarket. The configuration can be set on the SPDO, or inherited from default values on the contract.

Only the SPDO can be added to a despatch. MineMarket assigns the loading or unloading transactions for the despatch to the CDOs in the order specified on the SPDO.

Example: Company A plans to despatch 50,000 mt of coal to Organisation B. However, the invoicing needs to be split between Organisation B and Organisation C:

  1. A SPDO is created with a required quantity of 50,000 mt of coal.
  2. Two CDOs, each with a required quantity of 25,000 mt, are added to the SPDO:
    1. CDO1 is for the contract with Organisation B.
    2. CDO2 is for the contract with Organisation C.
  3. The SPDO is added to the shipment to Organisation B.
  4. The shipment is loaded with 50,000 mt of coal and the SPDO is associated with the loading transaction.
  5. MineMarket assigns the first 25,000 mt that is loaded to CDO1, and the second 25,000 mt to CDO2.
  6. Two invoices are created:
    1. One invoice is created for CDO1. The invoice line items are calculated using the contract terms from the contract with Organisation B.
    2. One invoice is created for CDO2. The invoice line items are calculated using the contract terms from the contract with Organisation C.
CDO Selection

Only despatch orders that have not been associated with a despatch or a stockpile, have not been loaded directly or associated with any transaction, and do not have any type of invoice created, can be assigned as CDOs of a SPDO.

The SPDO and CDOs must have the same:

  • Contract type (sales or purchase)
  • Material
  • Basis and basis list

The CDOs do not have to be associated with the same contract or even with the same organisation as the SPDO.

CDOs should be placed in the order in which they will reclaim the quantity from the SPDO.

SPDOs for Cumulative Pricing

Cumulative pricing is only applicable to contracts with product pricing.

Creating an SPDO for cumulative pricing involves:

  • Cumulative pricing in the contract terms
  • Configuration of the SPDOs

To configure cumulative pricing in a set of contract terms:

  1. Set the contract term's Invoice Evaluation Method to By Pricing Line.
  2. In the quotation pricing header, set the Weighting Type to Cumulative Quantity.
  3. Specify the Weighting Value of each of the pricing lines, leaving the Weighting Value of the last pricing line blank.

The SPDO configuration can be set on the SPDO, or inherited from default values on the contract.

The MineMarket Marketing Service creates a CDO for each SPDO. Only the CDOs can be invoiced. If the quantity of a SPDO needs to be split across multiple pricing lines, MineMarket creates CDOs as required and splits the quantity from the SPDO between the CDOs. The shipment, billing and payment organisations and their addresses (for example, Ship To, Bill To, Ship To Address) can be edited on the CDOs. For example, billing for each pricing line may need to be for separate organisations.

Only the SPDO can be added to a despatch.

Cancelled SPDOs are excluded from the calculation of cumulative quantities.

Example: Company A plans to despatch 20,000 mt of coal to Organisation B. The provisional price is a fixed price of 50 USD/mt. The following cumulative final pricing lines are configured:

  • The first 10,000 mt are priced with a quotation period (QP) of M-1. That is, the price comes from a price series, and the applicable price is from the month before the month of shipment.
  • The second 10,000 mt are priced with a QP of M+1. That is, the price from the month after shipment.

An SPDO is loaded with 8,000 mt early in December. Because the final price (from November) is known, Company A creates a final invoice for the CDO of this SPDO.

The next SPDO is loaded with 8,000 mt later in December. MineMarket splits this SPDO into two CDOs:

  1. CDO1 is allocated 2,000 mt because that is the quantity still required for the first pricing line. Company A can create a final invoice for CDO1, using the November price.
  2. CDO2 is allocated the remainder of 6,000 mt. Because the final price (from January) is not yet known, Company A creates a provisional invoice for CDO2, using the fixed provisional price.

Note: If the quantity of an SPDO is changed, MineMarket adjusts the quantities of the CDOs. For example, if the required quantity of an SPDO is large enough to need splitting across two pricing lines, MineMarket creates the two CDOs. If the actual despatched quantity does not need to be split, the CDOs still exist, but all the quantity is allocated to the first CDO. The second CDO then has a quantity of zero. Subsequent CDOs are also adjusted or split if required.

CDO Creation and Display

For SPDOs for cumulative pricing, the MineMarket Marketing Service creates the CDOs automatically as required. Unlike for SPDOs that are split based on loading or unloading transactions, the CDOs do not need to exist in MineMarket before loading the SPDO.

The CDOs are grouped with their SPDO in the Despatch Order tables in the contract and in the Despatch Order Explorer like the grouping of aggregated (APDOs) or consignment parent despatch orders (CPDOs). However, unlike CDOs of an APDO or a CPDO, CDOs that are created for an SPDO cannot be removed from their SPDO.

Control Passed

The configuration of delivery terms includes the conditions that must be met on despatches in order for control to pass from the seller to the buyer. See Delivery Terms.

If control has passed for a SPDO, control has also passed for its CDOs.