Order-to-Cash (OTC)

Order-to-cash is the full lifecycle of a customer transaction from the moment an order is placed to the moment payment is collected. In a logistics context, it spans order receipt and validation, inventory allocation, warehouse pick-and-pack, shipment planning and carrier selection, transportation execution, delivery confirmation, customer invoicing, and payment reconciliation. Every handoff in this chain is a potential point of delay, error, or cost leakage.

For shippers, the transportation segment of order-to-cash is often the most operationally complex and least controlled. Once freight leaves the warehouse, visibility depends on carrier data quality, tracking updates may lag, exceptions go undetected until a customer calls, and proof of delivery documents – essential for triggering invoicing – get lost in carrier portals or email threads. A breakdown anywhere in this chain delays the cash cycle: if you can't confirm delivery, you can't invoice; if you can't invoice, you can't collect.

The financial impact of a slow or broken order-to-cash process extends beyond cash flow. Disputed deliveries, missing PODs, and invoice errors create friction with customers and tie up accounts receivable resources. Late deliveries trigger chargebacks and penalties – especially from major retailers with strict OTIF requirements. And the internal cost of manually managing each step – building loads, tracking shipments, collecting documents, auditing freight invoices – eats into the margin of every order shipped.

Compressing the order-to-cash cycle requires tight integration between order management, transportation execution, and financial systems. When shipment status, delivery confirmation, and freight costs flow automatically from the logistics platform back to the ERP – without manual re-entry or document chasing – invoicing accelerates, disputes decrease, and the business gets paid faster.