Procurement with SAP MM: Business User Guide (SAP PRESS) | Reading Sample

Reading SampleIn this chapter, you‘ll explore the main components of each piece of master data and their importance in the procurement process. You’ll learn why and how each field affects the outcome in a purchasing document so you can more efficiently maintain your master data to yield better results when executing purchasing activities.

Matt Chudy and Luis Castedo

Procurement with SAP MM: Business User Guide533 Pages, 2017, $79.95 ISBN 978-1-4932-1517-1

www.sap-press.com/4355

First-hand knowledge.

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Contents

1 Management at a Glance ............................................ 15

1.1 Materials Management Overview .................................. 161.1.1 Material Requirements Planning ....................... 171.1.2 Purchasing ....................................................... 171.1.3 Inventory Valuation and Control ...................... 181.1.4 Master Data ..................................................... 18

1.2 Materials Management with SAP ................................... 191.2.1 Inside SAP ERP ................................................. 191.2.2 Outside SAP ERP .............................................. 22

1.3 Materials Management Organizational Structures .......... 311.3.1 Client ............................................................... 321.3.2 Company Code ................................................. 321.3.3 Plant ................................................................ 321.3.4 Purchasing Organization ................................... 331.3.5 Purchasing Groups ........................................... 37

1.4 Summary ....................................................................... 37

2 Master Data ................................................................ 39

2.1 Importance of Master Data in Procurement ................... 392.2 Material Master ............................................................. 40

2.2.1 Basic Data View ............................................... 432.2.2 Purchasing View ............................................... 44

2.3 Service Master ............................................................... 492.3.1 Service Master Sections .................................... 512.3.2 Creating a New Service ..................................... 54

2.4 Business Partners ........................................................... 552.4.1 Number Ranges, Account Group, and

Field Status ...................................................... 562.4.2 Vendor Master Data Structure .......................... 582.4.3 Maintaining Vendor Master Data ..................... 67

2.5 Vendor Hierarchies ........................................................ 692.6 Source Lists ................................................................... 712.7 Quota Arrangement ....................................................... 742.8 Purchasing Info Records ................................................ 79

2.8.1 General Data .................................................... 802.8.2 Purchasing Organization Data 1 ....................... 81

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2.8.3 Purchasing Organization Data 2 ........................ 842.8.4 Transactions ..................................................... 85

2.9 Pricing ........................................................................... 852.9.1 Using Conditions in Purchasing Documents ...... 872.9.2 Condition Records ............................................ 89

2.10 Taxes ............................................................................. 912.10.1 Adding Tax Relevance ....................................... 922.10.2 Adding the Tax Code ........................................ 942.10.3 Creating Condition Records .............................. 96

2.11 Other Master Data ......................................................... 992.11.1 Routes .............................................................. 992.11.2 Batches ............................................................ 100

2.12 Summary ....................................................................... 101

3 Planning and Forecasting ............................................ 103

3.1 Material Requirements Planning Procedures .................. 1043.1.1 Material Requirements Planning ....................... 1053.1.2 Consumption-Based Planning ........................... 107

3.2 Master Data in Planning ................................................ 1113.2.1 MRP Type ........................................................ 1113.2.2 MRP Areas ....................................................... 1143.2.3 MRP Groups ..................................................... 1193.2.4 Planning Calendar ............................................. 120

3.3 Forecasting .................................................................... 1223.3.1 Forecast Models ............................................... 1243.3.2 Forecast Control Data ....................................... 1263.3.3 Material Forecast Profile ................................... 1283.3.4 Executing a Forecast ......................................... 130

3.4 Sales and Operations Planning and Flexible Planning ..... 1353.4.1 Defining an Infostructure .................................. 1373.4.2 Maintaining a Planning Hierarchy ..................... 1383.4.3 Product Group .................................................. 1383.4.4 Setting Up a Forecast Profile ............................. 1403.4.5 SOP Process Steps ............................................ 142

3.5 Planning Execution ........................................................ 1433.5.1 Total Planning .................................................. 1443.5.2 Single-Item Planning ........................................ 145

3.6 Evaluation and Analysis .................................................. 1473.6.1 MRP List .......................................................... 1483.6.2 Stock/Requirements List ................................... 149

3.7 Summary ....................................................................... 150

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4 Purchasing from Third Parties ..................................... 151

4.1 Requests for Quotation (RFQs) ...................................... 1524.1.1 Creating an RFQ ............................................... 1534.1.2 Processing the Quotation ................................. 156

4.2 Outline Agreements ...................................................... 1594.2.1 Contracts ......................................................... 1604.2.2 Scheduling Agreements .................................... 168

4.3 Purchase Requisitions .................................................... 1784.3.1 Creating a Purchase Requisition Manually ........ 1804.3.2 Assigning Source of Supply ............................... 181

4.4 Purchase Orders ............................................................ 1824.4.1 Creating Purchase Orders Automatically ........... 1854.4.2 Converting Purchase Requisitions to POs ......... 1864.4.3 Creating a Purchase Order Manually ................. 1874.4.4 Printing or Emailing a Purchase Order .............. 189

4.5 Subcontracting .............................................................. 1934.5.1 Master Data ..................................................... 1934.5.2 Subcontracting Process Flow Overview ............. 200

4.6 Third-Party Orders ......................................................... 2094.6.1 Configuration Prerequisites .............................. 2094.6.2 Third-Party Process Flow Overview .................. 2094.6.3 Master Data ..................................................... 212

4.7 Release Strategies .......................................................... 2124.7.1 Release Strategy without Classification ............. 2134.7.2 Release Strategy with Classification .................. 215

4.8 Return Materials to Vendor ........................................... 2214.8.1 Returns in Inventory Management ................... 2224.8.2 Returns to Vendor in Purchasing ...................... 223

4.9 Vendor Evaluation ......................................................... 2264.9.1 Performance Criteria ........................................ 2264.9.2 Scoring ............................................................. 2304.9.3 Understanding How the Evaluation Is

Calculated ........................................................ 2324.9.4 Performing Vendor Evaluation .......................... 2344.9.5 Comparing Performance ................................... 235

4.10 Reporting ...................................................................... 2374.10.1 List Displays ..................................................... 2384.10.2 Analyses ........................................................... 248

4.11 Summary ....................................................................... 251

Contents

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5 Intracompany and Cross-Company Procurement ....... 253

5.1 Classic Stock Transport Order Process ............................ 2535.1.1 Configuration Prerequisites ............................... 2555.1.2 Master Data ..................................................... 2595.1.3 Two-Step Stock Transport Order without

Outbound Delivery ........................................... 2625.1.4 One-Step Stock Transport Order with

Outbound Delivery ........................................... 2685.1.5 Two-Step Stock Transport Order with

Outbound Delivery ........................................... 2755.2 Classic Cross-Company Code Stock Transport Order ....... 281

5.2.1 Configuration Prerequisites ............................... 2815.2.2 Master Data ..................................................... 2855.2.3 Cross-Company Code Purchase Order

Process Flow Overview ..................................... 2875.3 Stock Transport Orders with Stock In-Transit ................. 294

5.3.1 Configuration Prerequisites ............................... 2965.3.2 Master Data ..................................................... 3065.3.3 Intracompany Code STO Using SiT .................... 3105.3.4 Cross-Company Code STO Using SiT ................. 3165.3.5 Returns Scenarios Using SiT .............................. 3245.3.6 Using SiT in External Procurement .................... 325

5.4 Summary ....................................................................... 325

6 Kanban ........................................................................ 327

6.1 Kanban Procedures and Categories ................................ 3276.1.1 Classic Kanban .................................................. 3296.1.2 One-Card Kanban ............................................. 3306.1.3 Kanban with Quantity Signals ........................... 3306.1.4 Event-Driven Kanban ........................................ 330

6.2 Master Data ................................................................... 3306.2.1 Production Supply Area .................................... 3316.2.2 Control Cycle .................................................... 3326.2.3 Kanbans Section ............................................... 3336.2.4 Replenishment Strategy Tab ............................. 3336.2.5 Flow Control Tab .............................................. 3346.2.6 Kanban Calculation Tab .................................... 3356.2.7 Print Control Tab .............................................. 335

6.3 The Kanban Board and Signals ....................................... 3366.4 Summary ....................................................................... 337

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7 Order Optimizing ........................................................ 339

7.1 Investment Buying ......................................................... 3417.2 Quantity Optimizing ...................................................... 3437.3 Load Building ................................................................ 3477.4 Summary ....................................................................... 358

8 Procurement of Services .............................................. 359

8.1 Processing Requirements ............................................... 3608.1.1 Creating a Purchase Requisition ....................... 3618.1.2 Creating an RFQ ............................................... 3648.1.3 Creating a Reference Document from a

Purchase Requisition ........................................ 3708.2 Service Entry and Acceptance ........................................ 371

8.2.1 Entering a New Service Entry Sheet .................. 3728.2.2 Accepting a Service .......................................... 374

8.3 Using Outline Agreements for Services .......................... 3778.3.1 Creating Contracts for Services ......................... 3778.3.2 Releasing Contracts for Services ........................ 380

8.4 Summary ....................................................................... 380

9 Inbound Logistics ........................................................ 383

9.1 Confirmation Controls ................................................... 3849.1.1 Master Data ..................................................... 3859.1.2 Purchasing Info Record ..................................... 387

9.2 Order Acknowledgements ............................................. 3889.2.1 Automatic and Manual Confirmation ................ 3899.2.2 Monitoring Confirmations ................................ 390

9.3 Rough Goods Receipts ................................................... 3929.3.1 Creating a PO ................................................... 3939.3.2 Creating a Rough Goods Receipt Document ..... 393

9.4 Inbound Delivery: Shipping Notification ........................ 3959.4.1 Collective Processing of Purchase Orders .......... 3999.4.2 Individual Processing of Purchase Orders .......... 4009.4.3 Monitoring ....................................................... 4039.4.4 Processing Inbound Deliveries with HU

Management .................................................... 4109.5 Inbound Shipments ....................................................... 419

9.5.1 Grouping Shipments ......................................... 4219.5.2 Individual Shipment Processing ........................ 422

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9.5.3 Collective Shipment Processing ......................... 4279.5.4 Create Shipment Using Extended Inbound

Delivery Processing ........................................... 4309.6 Shipment Cost Document .............................................. 432

9.6.1 Creating an Automatic PO and Service Entry Sheet ....................................................... 434

9.7 Summary ....................................................................... 438

10 Inventory Management ............................................... 439

10.1 Overview ....................................................................... 44010.2 Receiving ....................................................................... 442

10.2.1 Automatic Postings Role ................................... 44410.2.2 Posting Goods Receipt with Transaction MIGO ... 44510.2.3 Accounting Documents as a Result of Inventory

Change ............................................................. 45010.3 Managing Special Stocks ................................................ 451

10.3.1 Consignment .................................................... 45210.3.2 Subcontracting ................................................. 45310.3.3 Customer Order Stock ...................................... 45310.3.4 Stock in Transit ................................................. 454

10.4 Transfer Postings ............................................................ 45610.5 Summary ....................................................................... 459

11 Logistics Invoice Verification ...................................... 461

11.1 Invoice Processing ......................................................... 46211.1.1 Create an Invoice: Manual Entry ....................... 46311.1.2 Create Invoice: Automatically ........................... 46611.1.3 Blocking and Releasing Invoices ........................ 47011.1.4 Parking Invoices ............................................... 473

11.2 Automatic Settlement .................................................... 47711.2.1 Evaluated Receipt Settlement ........................... 47711.2.2 EDI Processing .................................................. 481

11.3 Processing Subsequent Debits and Credits ..................... 48311.4 Cancelling an Invoice Document .................................... 48511.5 Summary ....................................................................... 486

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Appendices ......................................................................... 489

A Procurement Tables ................................................................. 491B Working with Procurement Documents: Quick Reference

Guide ....................................................................................... 501C Additional Resources ............................................................... 513D The Authors ............................................................................. 515

Index .............................................................................................. 517

Reading SampleIn this chapter, you‘ll explore the main components of each piece of master data and their importance in the procurement process. You’ll learn why and how each field affects the outcome in a purchasing document so you can more efficiently maintain your master data to yield better results when executing purchasing activities.





“Master Data”

Contents

Index

The Authors


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Chapter 2

The materials you buy, the vendors from which you buy, and the prices your company pays each vendor are all part of the master data in the SAP ERP system.

2 Master Data

The versatile SAP ERP system provides many ways to buy, stock, sell,and value materials. Many of these options are set on an individualmaterial basis. Those settings are entered in the central material catalogor material master. In the same way that you store information and set-tings for the materials your company buys, manufactures, and sells, youcan also store information and settings for the vendors you source thematerials and services from in the vendor master. Further master datafor procurement is created when you detail prices, discounts, and termsof payment for each material via purchasing info records in SAP ERPwhen you buy the material from different vendors.

In this chapter, we’ll explain the main components of each piece of mas-ter data and their importance in the procurement process. You’ll learnwhy and how each field affects the outcome in a purchasing documentso you can more efficiently maintain your master data to yield betterresults when executing purchasing activities.

2.1 Importance of Master Data in Procurement

Master data in SAP ERP, specifically in Materials Management (MM)procurement, is the foundation on which transactions are executed.When you create a purchase order in the SAP ERP system, for example,you’ll have to enter the vendor number for the party you’re buyingfrom, the material number of the product you’re buying, the quantityyou’re ordering, and the place where you want it delivered.

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Automaticdetermination

Based partially on this information, the system determines the price andthe discounts that you can get from this vendor, the shipping address, theplace where the vendor is shipping the materials to, the shipping condi-tions, and the shipping methods. The system also determines what kindof information needs to be passed on to the warehouse so that the ware-house employees can start putting away the product when they receive it.The system also tells them if quality inspection of the goods is required.

As you can see, when you create transactional data, the system makesmany determinations for the execution of that business process that arebased on business rules and on the master data involved in that transac-tion.

Invest time inmaster data

If you want accurate results, you’ll need to make sure that the masterdata is accurate. The more time you invest in making sure that the mas-ter data is correct and complete, the better the transactional results willbe, thus substantially reducing the time required to correct or completeincorrect or incomplete transactions, which, in the end, results in betterorder fulfillment, fewer missing parts, and thus higher quality in yourcompany.

Pricing Pricing is another important element. You’ll need to make sure that therelevant pricing condition records, including list prices, volume dis-counts, shipping surcharges, and other price variables, are included.This information avoids errors in the value of the purchase orders. Pric-ing will be discussed in detail in later chapters.

Master data isn’t static and must be maintained constantly and accu-rately. Your SAP experience will be much more productive and muchless stressful if you make sure your master data is of the highest qualitypossible. Now that you understand why master data plays such animportant role in procurement activities, let’s move on to discuss thedifferent types of master data that need to be maintained.

2.2 Material Master

The material master is the central repository of data about everythingyour company sells, buys, or transforms. The SAP ERP system treats

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materials differently according to their purpose in your company. Todifferentiate them, materials are classified into material types:

Material types� Raw materials These materials will be either transformed or assembled in your com-pany’s production processes. Each has to be set up in the materialmaster.

� Trading goods These goods are products that your company buys and then resellswithout any transformation. For example, a wholesaler or a sales com-pany acquires manufactured goods from other companies in the samecorporation and then sells them to retailers or end consumers.

� Non-stock materials These materials aren’t kept in a warehouse. For example, software isdownloaded from a digital stream instead of installed from a CDshipped from a warehouse.

� ServicesAll the services your company buys from other companies, such asmaintenance, consulting, or auditing, must be set up in the materialmaster. You would also set up those services your company sells inthis material type.

� Packaging materials These materials will contain or wrap the products when shipped fromthe warehouse. Examples of packaging materials are boxes, crates,containers, and so on.

� Finished goods The result of the manufacturing or assembly process is a finished goodthat will be sold to clients. In some cases, finished goods are alsobought or transferred from other subsidiaries of your company.

� Competitive products Some companies decide to keep material master records for productsfrom their competitors. The intention is to keep track of the product’scharacteristics and notes about how a product compares to your com-pany’s own products.

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In the material master, you’ll keep generic information such as the SKUnumber; a brief description of the item; and the item’s dimensions, theweight, and the unit of measure (UoM). You’ll also classify the item byassigning it a material group and a place in the product hierarchy. Inthe material master, you also assign different EAN codes for differentproduct presentations or packaging, such as single items, six-packs,and so on.

Views Each material type requires a different type of data, and the SAP ERP sys-tem uses what, in SAP terms, is known as views to organize the sets ofdata for each material type. We’ll discuss the different views that areavailable in the material master (as shown in Figure 2.1) in the followingsubsection.

Figure 2.1 The Basic Data View of the Material Master

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2.2.1 Basic Data View

This view contains information that is central to the material, whichdenotes that all the departments in a company use the information. Inthe following subsections, we’ll introduce you to some of the mostimportant fields in the Basic Data views.

Material Number

This number uniquely identifies an item in the system. In the SAP ERPsystem, the number can either be assigned automatically by the systemthrough the use of internal number ranges, or it can be assigned by theuser via external number ranges. In your company, you’ll have eitherinternally or externally assigned numbers depending on your ownneeds and business definitions. So depending on your system setup,you’ll either enter an external material number or leave the field blankso the system can assign a number from the pool of number ranges.

Cross Plant Material Status

The X-plant matl status field is used to communicate the stage in theproduct’s lifecycle where the product is. These statuses are maintainedduring the configuration of the system and can tell you that the materialis, for example, in development or has been released for sales, if it’sblocked, or even if it’s discontinued. This field isn’t only for informa-tional purposes; it drives specific functionality based on the configura-tion of the system, allowing or blocking certain business functions suchas buying or selling. You’ll have to select the right value for each mate-rial, depending on its status, to determine which functions are available.

Base Unit of Measure

Every material is handled differently; for example if you work in thechemical industry, you might be buying raw materials or selling yourfinished products by either weight or volume. So the unit of measure foryour material is either kilograms/pounds or liters/fluid ounces, allowingyou to know how much stock is available in the warehouse, as well ashow much you order from your vendors. In the consumer product

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industry, you likely buy and sell your products by the piece, so a piece(PC) is the base unit of measure. Make sure you select the right unit ofmeasure because, after you create transactions, have stock, or add thismaterial to other master data, the system won’t let you change it.

Net Weight, Gross Weight, and Volume

These fields are important for storage, shipping, and transportationactivities. If these values are inaccurate, your company might overpayon shipments or overload trucks, which in both cases will result instopped shipments and ultimately in unsatisfied customers. Make sureyou enter the right information in these fields; one way to get the cor-rect weight and dimensions is to run each material through a machinesuch as a CubiScan™.

Product Hierarchy and Material Group

These two fields help you classify and give a hierarchy to the products.If your company sells sporting goods, for example, then you might havematerial groups that segregate golf products from clothing, baseballproducts, and so on. The hierarchy provides a similar classification butcan be more granular. You can have several levels, which allows you tobuild a product family tree.

Another important feature of the material group and the product hierar-chy is that they are used by the financial modules to derive special post-ings and profitability analysis. Always make sure you discuss the valuesto be entered in these fields with your engineering, sales, and con-trolling peers.

2.2.2 Purchasing View

The Purchasing view, shown in Figure 2.2, contains data that is rele-vant only to a specific purchasing organization and plant. This viewallows different areas of the same company to buy the same material orproduct in different manners, according to their processes or geographiclocations. Different areas may buy the same product differently. We’llgo over the most important fields in the following subsections.

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Figure 2.2 Purchasing View

Note

Although several other fields exist in the Purchasing view and in general inthe material master, the ones we’ll discuss could cause more problems whileprocessing purchasing documents if not properly set.

Purchasing Group

This field indicates which group or person is in charge of buying thismaterial when required. Enter values that reflect who buys each mate-rial.

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Order Unit

When you buy a material in a unit of measure different from the baseunit of measure, you can indicate this difference in the Order Unit

field. You’ll have to indicate a conversion factor between the two unitsof measure so that the system can calculate the quantities and prices cor-rectly. A unit here will apply for all vendors; you may choose to use thisinformation in the specific purchasing info record for each vendor.Enter the value that better reflects the way you purchase your material,for example, boxes, bags, pallets, and so on.

Plant-Specific Material Status

The plant-specific material status field (Plant-sp.matl status ) restrictsthe usability of the material for the plant concerned; that is, this statusdefines whether a warning or error message is displayed if you includethe material in a particular function in Purchasing, Inventory Manage-ment, Warehouse Management, Production Planning, Plant Mainte-nance, or Costing. For each material, depending on its status, you’ll haveto select the right value to determine which functions are available.

Valid From

When a status is managed, a validity date until when that specific statusis valid must be entered. Normally, you’d enter the current date in thisfield.

Tax Indicator

The Tax ind. f. material field helps the system during tax determina-tion. This indicator is used, along with other system settings, to deter-mine the tax code that applies for specific purchases. Check with yourfinance peers on the correct values that you need to enter here.

Automatic PO

The Autom. PO indicator, used with other vendor information, allowsthe system to automatically create purchase orders from purchase requi-sitions. When this indicator isn’t set, you’ll have to manually convert

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requisitions into purchase orders. Select this field only if you want toallow the creation of automatic POs. Leave this field blank if you’ll con-vert them manually.

Purchasing Value Key

This field drives several things in the system: reminders to the vendorfor expediting the shipments, tolerance limits for receipts of materialinto the warehouse, minimum receipt quantities, and whetheracknowledgements are required. This field also includes the shippinginstructions that apply for each material. All these values guide thefunctionality of the purchase orders. Check the available values offeredby your system configuration and select the one that best suits eachmaterial. If you need different values, only a functional analyst can cre-ate and configure them for you.

Goods Receipt Processing Time

This value tells the system that this material isn’t received into stock assoon as it’s delivered at the warehouse. The warehouse processes maydelay the receipt for a few days, and that time is taken into considerationin the delivery lead time to ensure timely availability of the materials.Check with your warehouse and quality groups on the time they need toput the material into stock from the moment it’s received through thedock door.

Quota Arrangement Usage

A material can be included in a quota arrangement if the Quota arr.

usage field is used. Quota arrangements are discussed in later chapters.Enter the right value for the different purchasing documents wherequota arrangements are going to be used for each material.

Post into Inspection

A material is put into inspection stock upon receipt at the warehousewhen the Post to insp. stock field is set. This triggers the QualityManagement (QM) functionality. Check this field only if you’re using

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the QM component in your company because it triggers specific func-tionality and affects the stock category where the material is received.

Source List

A material requires a source list if this field is used. Source lists are dis-cussed in more detail in Chapter 4. Check this field only if a source list ismandatory.

Manufacturer Part Number

You can keep the number your vendor identifies a material with in thisfield, which can then be used in purchase orders. Enter the manufac-turer part number if you need it to appear in the PO when you purchasethis material.

Manufacturer

The Manufact. field indicates which manufacturer makes this part. Inthis field, you select the manufacturer from the vendor master. So ifyou’re going to use this field, you’ll need to create the vendor.

Critical Part

When you use this field, the system tells the QM component that a fullcount needs to be done on this material upon receipt at the warehouse.

Table 2.1 provides a list of transactions for material master mainte-nance.

Transaction Menu Path

MM01: Create Immediately

Logistics � Materials Management � Material Master � Material � Create General � Immedi-

ately

MM02: Change (any material type)

Logistics � Materials Management � Material Master � Material � Change � Immediately

Table 2.1 Material Master Transactions via the Materials Management Menu

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2.3 Service Master

We’ve already mentioned that you can create services in the materialmaster and that you can then buy them for your company as if they wereany other part or component. And sometimes that is just fine, but someservices may require more effort, such as consulting or constructionprojects that take a long time and in which you have to account forhours of services rendered, for progress in a deliverable, or for any otherpartial delivery.

Non-stock materials

Services created in the material master, being non-stock materials, can’tbe received, so the only function in MM is the invoice receipt, in whichyou enter the billed amount into accounts payable.

The SAP ERP system includes the ability to track this kind of servicethrough the Purchasing component with the use of the service master.Any services created in this master catalog receive special attention andcan be received or verified by an employee who is tasked with thisresponsibility. Usually, the responsible person is the manager of the

MM03: Display (any material type)

Logistics � Materials Management � Material Master � Material � Display � Current

MMH1: Create Trading Goods

Logistics � Materials Management � Material Master � Material � Create Special � Trading Goods

MMN1: Create Non-Stock

Logistics � Materials Management � Material Master � Material � Create Special � Non-Stock

MMS1: Services

Logistics � Materials Management � Material Master � Material � Create Special � Service(s)

MMV1: Create Packaging Materials

Logistics � Materials Management � Material Master � Material � Create Special � Packaging

MMH1: Competitor Product

Logistics � Materials Management � Material Master � Material � Create Special � Competitor Product


Table 2.1 Material Master Transactions via the Materials Management Menu (Cont.)

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area that requested the service or a project manager in charge of a spe-cific project.

You can purchase, for example, the total number of consulting hoursthat a project requires and receive, or verify, the partial hours renderedevery week. Receiving a service in the SAP ERP system consists of com-pleting a service entry sheet, which is to services what a goods receipt isto materials. A sample purchase order for a service is shown in Figure2.3; note the account assignment K and item category D for the service.

Figure 2.3 Sample Purchase Order for a Service

Three-way match This way, you can match the deliverables requested in the purchaseorder with the services rendered and verified in the service entry sheetand then also with the invoice in the Invoice Verification process—giv-ing you a three-way match.

Additionally, the service master allows you to standardize communica-tions with your vendors so that you both refer to the same entry or work

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breakdown structure (WBS) in a project plan. You can also make refer-ence to a higher-level service when you’re specifying subservices, asshown in the example in Figure 2.4.

Figure 2.4 Sample Service Entry Sheet: Service Delivery and Progress

2.3.1 Service Master Sections

In the following subsections, we’ll describe some of the most importantfields in the service master shown in Figure 2.5. The service masterdoesn’t have views but instead has different data sections.

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Figure 2.5 Service Master Data Sections

General Data

The upper section of the service master includes the following:

� Activity Number This number uniquely identifies a service in the system. This numberis externally assigned. The text box next to the number is the serviceshort text where you can enter a description of the service.

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� Service Category This field is used to categorize the different services your companybuys. These categories classify services and are equivalent to the mate-rial type in the material master, which determines the valuation classfor the service. The available values are set in configuration and can’tbe changed by users.

� Base Unit of Measure The base unit of measure is the unit in which the service will bebought from the vendor.

� Deletion Indicator Unlike the material master, in the service master, you can set the dele-tion indicator directly in each service.

Basic Data

The Basic Data section includes the following:

� Mat/Srv.grp The material group helps group together services that belong to thesame service hierarchy. The material group also helps finance derivespecial postings and profitability analysis. The available values for thisfield are also set in configuration and can’t be changed by the user.

� Division

The division is another value that helps you group services for sales.This field isn’t relevant for purchasing services.

� Valuation Class This value is the key used to derive accounting postings in conjunc-tion with material movement types used during service confirmation.

Standard Service Category

The Standard Serv. Cat. section includes the following:

� Service Type The service type is used to standardize texts that are used to identifyservices in communication with the vendors. For example, if a service

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is part of a project, you can define types that tie to mutually agreedcodes such as a WBS number.

� SSC Item This number comes from the Service Catalog and helps standardizeservice descriptions to help eliminate data redundancy. This numberis also used to link services in the SAP system with the numberassigned by the partner rendering it; for example, a WBS number suchas "1.1.3".

Purchasing Data

The Purch. Data section includes the following:

� Purchasing Status The purchasing status controls the usability of the service in purchas-ing activities. By assigning a status, you can, for example, quote a ser-vice, requisition a service, purchase a service, or do nothing at all.

� Valid from When a status is managed, a validity date until when that status isvalid must be entered.

Internal Work

The Internal Work section includes the Conversion fields that allowyou to include conversion factors for the service’s base unit of measure,such as days to hours.

Long Text

The Long Text free format text field can hold a long description of theservice—as long as several pages.

2.3.2 Creating a New Service

To create a new service, go to Transaction AC03 or follow the menupath: Logistics � Materials Management � Service Master � Service �Service Master. Once there, enter a short text that describes the ser-

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vices, a service category (usually you’ll choose SERV for service purchas-ing), and the base unit of measure.

In the Basic Data view, enter a material group and a valuation class,which is the minimum information that you’ll need to provide to createa service, depending on the kind of service you’re creating. You can takea look at the fields described earlier and then decide if you need to usespecific fields for your own purposes.

Table 2.2 includes a list of transactions to maintain and list services andstandard service catalogs (SSC).

2.4 Business Partners

To initiate any transaction in any enterprise resource planning systems,including SAP ERP, such as creating a purchase order, receiving anincoming delivery, and issuing payment, you must have master dataobjects defined, including your business partners. In SAP ERP, you canclearly divide these business partners depending on the business trans-action and the role this partner plays. Business partners can be definedas the following:


AC03: Service Master Logistics � Materials Management � Service Master � Service � Service Master

AC06: Service List Logistics � Materials Management � Service Master � Service � Service List

ML01: Create Logistics � Materials Management � Service Master � Service � Standard Service Catalog � Create

ML02: Change Logistics � Materials Management � Service Master � Service � Standard Service Catalog � Change

ML03: Display Logistics � Materials Management � Service Master � Service � Standard Service Catalog � Display

MLS6: List Display Logistics � Materials Management � Service Master � Service � Standard Service Catalog � List Display

Table 2.2 Transactions for Service Master Maintenance

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Partner types � VendorsA vendor is a primary business partner that deals in procurement pur-chasing functions; that is, vendors provide your company, affiliates,or external customers with goods and services directly. Vendors canalso be both internal and external, such as your distribution ware-houses or other affiliates procuring goods within your organization.Also, if your vendor is buying goods and services from your organiza-tion, you can link the vendor master record to the customer master.

� CustomersA customer is a business partner to whom you’re providing goods orservices. Customers can be external or internal, and if that customer isalso providing you with goods and services, you can link the customermaster record to a vendor master. Individual customer master recordscan be defined for specific partner functions and can be linkedtogether.

� Other partners This partner category includes a mix of things such as site data, con-tact person, sales personnel, and competitors. Some of these objectscan also be linked to other business partner master records.

In the following sections, we’ll explain how to work with business part-ners.

2.4.1 Number Ranges, Account Group, and Field Status

Before you can create any vendor-related transactions, you’ll need anaccount—a vendor master—for a business partner, and you’ll have toassign an account group that defines the type of vendor. Depending onthe configuration setting, you may need to specify the account numberusing an external number range or let the system assign the internalnumber range for you. The following objects help in defining and man-aging the business partner data:

Define/maintain data

� Number ranges The NR field contains the number range used to define the businesspartner account; this entry can be all numbers or alphanumeric. Everybusiness partner requires an account number. You define the numberranges in configuration and assign intervals to account groups. This


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assignment will then be proposed when the account is created—eitherinternally by the system or externally where you’ll manually enter anumber during account creation.

� Account groups Account groups serve as templates for business partner accounts thatshould have the same properties such as number range and datascreen layouts and fields that are captured. The account group man-ages display screens, their sequence, and fields for entering data.Some examples of different account groups are shown in Figure 2.6.

Figure 2.6 Account Groups

� Field status Field status allows you to suppress or require certain data fields. Eachof your account groups can have different data requirements; forexample, standard vendor accounts won’t have the same fields as one-time suppliers. A one-time vendor won’t require banking informa-tion, for example. You can define field statuses based on the transac-tion used or make them company code-specific—but these settingsshould only be made as exceptions.

Tips & Tricks

When you create new account groups, always maintain the field status. If youdon’t mark a status for a field group, all relevant fields will be set to optional

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and will be displayed during vendor account creation or changes. Also bear inmind that, if you’re changing settings for an existing account group with exist-ing vendor master records in the database and you suppress a certain field, itscontent will be considered when the transactions are processed.

2.4.2 Vendor Master Data Structure

Vendor master records are generated using the previously discussedtemplate data defined in the account groups. Vendor data presented toyou is organized and grouped based on the level of detail, from the mostgeneric to most specific. Vendor master data stores the information thatis relevant for the different uses within procurement and other function-alities and is broken down to general data, company code, purchasingorganization, and sales and distribution data for accounts linked to thecustomer master.

Transaction XK03 To understand the data structure, we’ll walk through the vendor masterdisplay transaction by accessing Transaction XK03 (Display Vendor) orby following menu path: Logistics � Materials Management � Pur-

chasing � Master Data � Vendor � Central � XK03 – Display. Severaldifferent data tabs are available. The following subsections providemore explanation of each data group.

General Data

General data applies globally to one unique business partner for all ofyour business organizational structures. This section includes the fol-lowing:

� Address

In this field, you’ll store the name of the vendor, search terms for fastentry; its physical address; and, if needed, PO box information andcommunication information, such as phone numbers, fax, and emailaddress.

� Control In this field, you can link your vendor with the customer masterrecords and reference data further defining the industry, location,transportation zone, tax, and VAT information.


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� Payment Transactions This data tab stores the vendor’s bank information and alternativepayer data.

� Contact Person This field holds the miscellaneous master data object, which allowsyou to create a detailed contact list of people working for your vendorthat you’re communicating with. You can keep record of their homeaddress, personal data, and visiting hours.

Company Code Data

The company code data is the next segment of the vendor master andapplies to one unique company code, storing information relevant toFinancial Accounting (FI). If you have multiple company codes, you willhave multiple records created. The following data sections are main-tained:

� Account management This field stores accounting data, including reconciliation accounts,interest calculations, and reference data, such as the previous accountnumber, personnel number, and buying group.

� Payment Transactions This field records the terms of payment and tolerance group andallows you to enable payment history recording and set the time forthe deposited checks to clear for monitoring purposes. You can alsomaintain information for automatic payment transactions.

� Correspondence

In this field, you can maintain data related to dunning procedures,maintain accounting clerk data responsible for communication withthe customer, and set payment notices to be sent to your customerafter the payments clear.

� Insurance

This field records the insurance policy number, provider, and amountinsured as well as the validity dates of the export credit insurance.

� Withholding Tax In this field, you can maintain the tax withholding data by selectingthe tax types, tax codes, and validity periods applicable to them.

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Note

Extended tax withholding functionality must be active for the company codeselected to maintain this data.

Purchasing Organization Data

In this portion of the vendor master, you can maintain data that’s driv-ing purchasing transactions. Figure 2.7 shows an example of the Display

Vendor: Purchasing data screen.

Figure 2.7 Vendor Master: Purchasing Data


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These settings are purchasing organization-specific, so if you’ve imple-mented a decentralized form for your organization, you’ll have anoption to create multiple different records for the same supplier.

The following data sections can be set up here:

� Conditions

This section is used to influence pricing, pricing schema determina-tion, order currency, and Incoterms.

� Sales data If you have a specific person that is identified as a salesperson as yourprimary contact and if you have an account with this vendor, you canstore this information here.

� Control data This section of the purchasing organization data stores several differ-ent controls related to PO acknowledgement requirements, invoicereceipt processing, evaluation receipt settlement (ERS) settings, andsettlement controls. You can also set the return vendor assignment bylinking your vendor to a customer master ship-to account, setting theshipping conditions default, setting the ABC indicator where entering“A” indicates the greatest share of your business annual spend in dol-lars and cents, and finally setting the foreign trade data defaults.

� Default data material This section allows you to preset data that will be copied into purchas-ing documents during transactions. You can set the purchasing group(buyer) tied to the vendor account, the planned delivery time, and theconfirmation control key that controls if advance shipping notifica-tion is required to process your purchase orders for a specific sup-plier. You can also set up a default unit of measure group for groupingseveral allowed units of measure used in rounding profiles.

� Service Data This section houses additional controls for vendor-managed inven-tory (VMI) scenarios and automatic load builder transactions.

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Partner Functions

Roles In real-world purchasing scenarios, you’ll place an order with a supplierthat receives your purchase order, another party sends the goods, you’llget an invoice from the vendor’s headquarters, and you’ll send yourpayment to yet another location by another partner at a different loca-tion where their accounts receivables are processed. SAP allows you todefine this complex structure by maintaining all relevant or even man-datory partner functions via partner roles. Partner roles are defined inIMG Customizing, and allowed role combinations are assigned toaccount groups. Here is a list of some of the commonly used partnerroles:

Commonlyused roles

� AZ: Alternative payee

� DP: Delivering site

� GS: Goods supplier

� FA: Forwarding agent

� IP: Invoice presented by

� OA: Ordering address

� VN: Vendor

For example, you may want your vendors to have multiple orderingaddress partners, but you may not want the ordering address to bedefined as a plant or invoicing party. Figure 2.8 shows examples of per-missible partner role relationships to account groups.

Figure 2.8 Permissible Partner Role Definitions

Uses Some of the most common uses for the partner functions include the fol-lowing:


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� Ordering address Usually used for output processing

� Goods suppliers Used for tax purposes and foreign trade

� Invoice presented by Used to identify a party that will produce the invoice for your order

You can also define allowed partner combinations in a form of partnerfunction determination schema, which is a kind of template that can beapplied repeatedly to speed up your data maintenance. The partnerfunction determination schema—defined in IMG Customizing—sets therequired partner functions, which are then assigned to the accountgroup, purchasing documents, and rebate agreements. You can makecertain partners mandatory and control whether changes are allowedafter a record is created. These schemas are used when you define thevendor master record, create purchasing documents, or create rebateagreements.

The Partner functions data screen, shown in Figure 2.9, allows you tomaintain permissible partners and their account numbers. You can alsodisplay partner addresses and remove the entry, if needed, using theDelete line button.

Figure 2.9 Vendor Master: Partner Function Data

Keeping it simpleWhen setting up your vendors and partner roles, try to make them assimple as possible to make your vendor master data maintenance easierand cleaner, especially if your organization spans multiple environ-ments and other legacy applications.

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Alternative Purchasing Data

If you have detailed procurement requirements and your MRP alsorequires a lot of information to maintain multiple plants in a geographi-cally distributed organization and supply chain, you can use alternativepurchasing data.

Vendor subrange This extended data maintenance feature allows you to capture separatepurchasing organization and partner function details using individualplants and/or vendor subranges. Access the subrange data maintenancefrom the Purchasing Organization Data maintenance screen by usingthe Sub-ranges button shown in Figure 2.10.

Figure 2.10 Vendor Master: Subrange Maintenance

Vendor subranges can represent groups of your vendor product offer-ings, such as fasteners, abrasives, oils, and so on. Each of these subrangegroups is then assigned to a purchasing info record (see Section 2.8 formore details). Purchasing info records help determine the data duringPO creation; the vendor information, including partner functions, anddata such as planned delivery time for the material being purchasedautomatically populate the fields.

Group-specificdata

Vendor subrange master data allows you to maintain product group-spe-cific data, which can be used in combination with your destinationplants. You can have different planned delivery times, Incoterms, andcurrencies for a specific plant/subrange combination and also differentpartner function combinations; see Figure 2.11 for examples. In the


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screen, you can locate the Vendor sub-range entry for automotive

products and Plant New York combination with “X” in the Purc. (pur-chasing) and Partner columns. When you double-click on the X or clickon the Purchasing or Partners buttons, you’ll get to the detailedscreens where you can maintain the data. For each subrange line shown,you can have different data applied.

Figure 2.11 Alternative Purchasing Data and Partner Functions

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Note

The Default data material section has additional fields compared to the reg-ular vendor master purchasing data view and includes the cycles discussed inthe following subsections.

Delivery Cycle

You can assign a planning calendar that specifies the days your vendordelivery should be planned for, that is, basically establishing the deliv-ery cycle. Imagine you want your vendor to deliver goods every Friday,and the planned delivery time is three days. All POs created beforeWednesday will get this week’s Friday delivery date. Any PO createdafter Wednesday will be scheduled to be delivered next Friday. Othercontrols on the planning calendar allow you to make the system react toholidays falling on the Friday and shifting the delivery dates accordingly(covered in Chapter 3).

Note

Before a material can be planned using this method, make sure the MRP set-ting allows time-phased planning. Check the lot-sizing assignment and defini-tion in IMG Customizing for full effect.

Planning Cycle

You can assign a planning calendar that defines the day on which thematerial purchase order must be placed. The procedure works similarlyto the delivery cycle; however, in this case, you’ll create a PO on theestablished day of the week. So, for example, your weekly orders areplaced on Tuesday for Friday delivery with a planned delivery time ofthree days. Any requirements that are within this planned delivery timeare included in the PO created Tuesday.

Note

If you’re using purchasing load builder functionality, don’t maintain thesefields at the vendor subrange (VSR) level. The plant level is the lowest possi-ble level for additional purchasing and partner data.


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Creation Profile

Timing controlThe creation profile controls the timing of scheduling agreement deliv-ery releases and transmissions to the vendor. This profile is assigned tothe scheduling agreement items. SAP recommends that, if you haven’tspecified a time in the schedule lines, you should work with aggregationin the creation profile to consolidate lines with the same release date.

2.4.3 Maintaining Vendor Master Data

As we discussed in the previous sections, you can have multiple dataobjects for your business partners: the general view, company codeview, and purchasing organization data and its variations. You can cre-ate, change, and display master data records for all partner functions.Depending on your company’s security policy, several ways to maintainthis data are available. You should be able to create the complete vendormaster record or partial records, restricted to general and purchasingdata sections.

Navigation optionsYou can access the business partner maintenance using transactioncodes that follow the SAP rule of 3sm, where the numbers in the trans-action in example XX01 stands for create, XX02 for change, and XX03for display functions. Or, you can navigate to these transactions usingthe SAP Easy Access menu paths.

Maintain vendor master

To maintain the general data for your vendor, all you need is the accountnumber. To maintain the company code and related accounting data,you’ll also need the company code number. And finally, to maintainpurchasing data, you’ll have to specify the purchasing organization.Table 2.3 lists the transactions available to maintain the vendor master.


XK01: Create Vendor Centrally

Logistics � Materials Management � Purchasing � Master Data � Vendor � Central � Create

XK02: Change Vendor Centrally

Logistics � Materials Management � Purchasing � Master Data � Vendor � Central � Change

XK03: Display Vendor Centrally

Logistics � Materials Management � Purchasing � Master Data � Vendor � Central � Display

Table 2.3 Vendor Master Transaction Codes

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Maintenance Whenever you create a vendor master record, your company will dis-continue, block, or archive another master record. Vendor hierarchiesare maintained the same way, requiring you to update validity and add/remove nodes or partners (which we’ll cover in more detail in Section2.5). Usually, a master data group within your business or IT organiza-tion is tasked with monitoring and maintaining your business partnerrecords. Additional transactions are available to perform these tasks; thecommonly used transaction codes are listed in Table 2.4.

MK01: Create Vendor Purchasing

Logistics � Materials Management � Purchasing � Master Data � Vendor � Purchasing � Create

MK02: Change Vendor Purchasing

Logistics � Materials Management � Purchasing � Master Data � Vendor � Purchasing � Change (Current)

MK03: Display Vendor Purchasing

Logistics � Materials Management � Purchasing � Master Data � Vendor � Purchasing � Display (Current)


Table 2.3 Vendor Master Transaction Codes (Cont.)


XK04: Vendor Changes (Centrally)

Logistics � Materials Management � Purchasing � Master Data � Vendor � Central � Changes

XK05: Block Vendor (Centrally)

Logistics � Materials Management � Purchasing � Master Data � Vendor � Central � Block

XK06: Mark Vendor for Deletion (Centrally)

Logistics � Materials Management � Purchasing � Master Data � Vendor � Central � Flag for Dele-

tion

XK07: Change Vendor Account Group

Logistics � Materials Management � Purchasing � Master Data � Vendor � Central � Account Group Change

XK99: Mass Maintenance, Vendor Master

Logistics � Materials Management � Purchasing � Master Data � Vendor � Mass Maintenance

Table 2.4 Additional Vendor Master Maintenance Transactions

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2.5 Vendor Hierarchies

Vendor hierarchies allow you to create flexible objects to reflect theorganizational structure of your supplier. For example, if your vendorhas a complex sales department, multiple distribution centers, or retailstores, you can build hierarchies to reflect these structures.

Using hierarchiesYou can use vendor hierarchies in purchasing documents to determinepricing, including rebates. For each hierarchy node marked as relevantfor pricing, you can create a pricing condition record. If one or morenodes in a hierarchy contain pricing data, these nodes are automaticallyused during purchase order processing. If you add a new vendor to anyexisting hierarchy, the vendor automatically inherits all pricing agree-ments that apply to that node.

NodesA vendor hierarchy uses an account called a node (in a standard SAP sys-tem, you would use account group 0012 to define a node) when the ven-dor master record is created. A node represents the freely definable levelof your supplier organization; it could also represent your vendors’ geo-graphical/regional sales office structure or the number of distributioncenters that supply your specific ordering plants. You can assign a ven-dor account (standard account group 0001) to the lowest-level node inyour vendor hierarchy. You can then link the lower-level node—called

MK04: Change Vendor (Purchasing)

Logistics � Materials Management � Purchasing � Master Data � Vendor � Purchasing � Changes

MK05: Block Vendor (Purchasing)

Logistics � Materials Management � Purchasing � Master Data � Vendor � Purchasing � Block

MK06: Mark Vendor for Dele-tion (Purchasing)

Logistics � Materials Management � Purchasing � Master Data � Vendor � Purchasing � Flag for Deletion


Table 2.4 Additional Vendor Master Maintenance Transactions (Cont.)

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the dependent node—to the higher-level node in the hierarchy. Figure2.12 shows an example of a multilevel vendor hierarchy.

Figure 2.12 Vendor Hierarchy Example

Maintenance The structure of the vendor hierarchies is flexible and easy to maintain.You can move or change nodes within a hierarchy by moving all relatedvendor assignments with it, reducing maintenance time. In Table 2.5,you’ll find some useful vendor hierarchy maintenance transactions foryour reference.

Node Level 3104

Zebra SupplyNorthWest

Node Level 2102

Zebra SupplyWest

Node Level 1101

Zebra SupplyCentral

Vendor20014

Vendor20011

Vendor20013

Node Level 3105

Zebra SupplySouthWest

Node Level 2103

Zebra SupplyCentral

Vendor20012


MKH1: Maintain Vendor Hierarchy

Logistics � Materials Management � Purchasing � Master Data � Vendor � Hierarchy � Change

MKH2: Display Vendor Hierarchy

Logistics � Materials Management � Purchasing � Master Data � Vendor � Hierarchy � Display

Table 2.5 Vendor Hierarchy Maintenance Transactions

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2.6 Source Lists

Fulfill procurement requirements

When your procurement requirements are generated, you want themfulfilled as quickly as possible, and SAP gives you multiple ways to opti-mize this task. Existing sources are suggested by the system in the pre-defined sequence:

1. The system looks for a quota arrangement (covered in Section 2.7). Ifyou maintained quotas and the system found a valid entry, the vendoris selected based on the criteria maintained for the quotas.

2. If no quota arrangements are found, the system looks for source listentries, and the appropriate vendor and contract data, if maintained,are used.

3. If the source list records aren’t found, the system looks for valid con-tracts or scheduling agreements (discussed in Chapter 4).

4. Purchasing info records are considered last after all previous checksfail to find a defined and active source of supply. (You’ll learn moreabout purchasing info records in Section 2.8.)

Maintain listA source list is one of the features used in optimizing Purchasing, as men-tioned earlier in Section 2.6, which allows you to define possible sourcesfor products within a set of validity dates. You can maintain multipleallowed sources—vendors—and reference multiple agreements.

Source lists can contain allowed, blocked, and fixed records. Fixedsources take priority within defined a validity period. Blocked source listrecords are ignored during processing of purchasing documents, andbuyers can’t use blocked sources manually either. Source list functional-ity also gives you the ability to activate the MRP indicator to allow SAPto use the source data in materials planning. A source list can be specificto an individual material or can be set globally for all materials in theplant. Figure 2.13 shows an example of a multivendor list showing someof the data combinations described earlier.

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Figure 2.13 Maintain Source List Overview Screen

Uses of source lists Source lists are used in purchase requisition processing during manualor automated source determination procedures. They are also usedduring purchase order creation, where the source list is checked again ifthe PO vendor is allowed. As a result, you can limit suppliers to a man-ageable number and only do business with the most reliable and high-quality vendors.

Source lists can be generated in multiple ways:

� Manually using Transaction ME01

� From within the purchasing info record using Transaction ME11 orTransaction ME12

� From an outline agreement/contract using Transaction MK31N orTransaction MK32; using the mass maintain transaction via the auto-matic generation transaction

Figure 2.14 shows maintenance screen details.

Also, using the contract create or change transactions, you can createsource list entries for additional variations tied to the J4 category:

� M: Material unknown

� W: Material group

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Figure 2.14 Generate Source List: Maintenance View

MaintenanceLet’s walk through an example on source list maintenance using Trans-action ME01 (Maintain):

1. On the initial screen, specify the material and the plant the recordswill be maintained for and press (Enter) to continue.

2. On the next screen, maintain the validity periods for the allowedsources of supply and enter the vendor and Purchasing Org.

3. Save your source list.

If you have a purchase requisition for an item without a material masterbut with a material group specified, the system will try to source theitem using source list-defined records that reference a contract or inforecord with the same material group. You can fine-tune this type ofsource list by maintaining the materials exclusions indicator.

Refer to Table 2.6 for source list transactions and menu paths.


ME01: Maintain Logistics � Materials Management � Purchasing � Master Data � Source List � Maintain

ME03: Display Logistics � Materials Management � Purchasing � Master Data � Source List � Display

Table 2.6 Source List Maintenance Transactions

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2.7 Quota Arrangement

Supply source Quota arrangement allows you to provide a mechanism to determinethe source of supply if a requested material needs to be procured fromdifferent sources—internal or external—and have set quota values. Forexample, you need to control a certain material purchases to be splitbetween two vendors A and B, where one will supply 80% and the other20% of your material requests for a defined total quantity of 1,000pieces. Using this functionality and the defined quota, the system auto-matically suggests requisitions to fulfill the quota numbers. The totalquantity ordered from vendor A is 800 pcs, and the total quantityordered from vendor B is 200 pcs. These quotas specify percentages of atotal requirement to be procured from the defined sources.

Quota arrangements are common practice when you need to protect theinbound flow of goods and address issues such as uncontrollable pricehikes, embargos, geopolitical situations, currency fluctuations, andother disadvantages of using a single source of supply.

ME04: Changes Logistics � Materials Management � Purchasing � Master Data � Source List � Changes

ME0M: By Material Logistics � Materials Management � Purchasing � Master Data � Source List � List Displays � By Material

ME05: Generate Logistics � Materials Management � Purchasing � Master Data � Source List � Follow-On Func-

tions � Generate

ME06: Analyze Logistics � Materials Management � Purchasing � Master Data � Source List � Follow-On Func-

tions � Analyze

ME07: Delete Logistics � Materials Management � Purchasing � Master Data � Source List � Follow-On Func-

tions � Delete


Table 2.6 Source List Maintenance Transactions (Cont.)

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ActivateTo activate the quota arrangement functionality, follow these steps:

1. Maintain quota arrangement usage in IMG Customizing where youdefine the quota usage code.

2. Specify which purchasing documents are applicable for quota alloca-tion calculations—from purchase orders, scheduling agreements,planned orders, purchase requisitions, and MRP and productionorders, all the way to invoicing.

3. Assign the code defined in IMG Customizing to the material master ofan item you’re planning to manage using quota arrangements (seeFigure 2.15 for an example).

Figure 2.15 Material Master: Assign Quota Arrangement Usage

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Maintain To maintain the quota, run Transaction MEQ1 (Maintain) and followthese steps:

1. On the initial screen, enter the material number and plant the quota ismaintained for and press (Enter) to continue.

2. On the next screen, populate the header data. Header-level dataincludes a validity period; the system stops taking part in sourcingwhen your requirements date is outside of the defined bracket. Youcan also define the minimum quantity of your requirement for quotaarrangement to be applied during MRP.

3. To maintain line item details, select the line and then click on the Item

Overview button or press (F7) on your keyboard.

Quota fields On the detailed view of the quota arrangement item, you can maintainthe following fields (see Figure 2.16 for an example of the item over-view screen and fields):

� P

The procurement type can be internal or external procurement.

� S

A special procurement type allows you to define usage of consign-ment, subcontracting, and other flavors of procurement types.

� Vendor

The suppliers account number works together with the external pro-curement set for the procurement type.

� PPl

The procurement plant used to procure goods works together withthe internal procurement set for the procurement type.

� PVer

The production version to be used when procuring from the definedsource, you’ll need to use a different BOM or lot-sizing in repetitivemanufacturing.

� Quota

The quota number represents a portion of requirements to be sup-plied from the sources you’re maintaining.

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Figure 2.16 Maintain Quota Arrangement Overview Screen

� In % Quota in percent shows the Quota column number converted to thepercent distribution between sources of supply.

� Allocated Qty The allocated quantity represents the totals of all requisitions, pur-chase orders, contract release orders, scheduling agreement deliveryschedules, and planned orders that have been assigned to a source ofsupply (provided that these documents are to be taken into accountaccording to the Quota arr. usage indicator in the Purchasing

view). The quota-allocated quantity is updated automatically for eachorder proposal to which a quota arrangement is applied.

� Maximum Quantity The source will no longer be considered after the allocation reachesthis value.

� Quota Base Qty This value is treated as an additional quota-allocated quantity. You canuse the quota base quantity when you add a new vendor to the mixbut don’t want all requirements to be assigned to this new source ofsupply until its quota allocated quantity exceeds the quantity of theexisting sources.

� Max. Lot Size You can control the maximum order quantity allocated to a source of

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supply during the order proposal. If a requirement exceeds the maxi-mum lot size defined here, several order proposals are suggestedequal to the maximum lot size, until the total required quantity is cov-ered.

� Min. Lot Size This value defines a minimum quantity for an order proposal. If aminimum lot size has been entered, and the quantity required is lessthan the minimum order quantity, the order proposal is generatedwith a quantity equal to the minimum lot size.

Note

Minimum and maximum lot sizes are considered for autogenerated proposalscreated during an MRP run, where maximum quantity is also checked duringmanual purchase requisition and PO creation. If maintained, minimum and/ormaximum lot sizes from quota arrangement take precedence over the mate-rial master lot size settings.

� RPro

A rounding profile modifies the order proposal to specified purchas-ing units of delivery, such as rounding to a full pallet quantity, forexample.

� 1x

The once-only indicator controls how the source is being considered.If checked, this source will be considered only once for matching theamount of the maximum lot size. If the total requirement is largerthan the maximum lot size, the remaining quantity will be splitamong other sources defined in the arrangement.

Other fine-tuning options within quota arrangements allow you tomanipulate controls related to period-related releases and the sequenc-ing of splits when proposals are generated. The preceding list covers themost frequently used features and controls quota arrangements offer.

Finally, save your quota arrangement when you complete the data main-tenance.

Table 2.7 provides common quota arrangement transactions and menupaths.

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2.8 Purchasing Info Records

When you process your purchase requisitions into purchase orders, acertain amount of information is repeated over and over again, such aspurchase price, delivery tolerances, planned delivery time, standardorder quantity, or confirmation controls. To optimize this process andsave time for your users, you can use a reference document such as acontract or a purchasing info record. Reference documents are the mostpopular data source objects in optimized purchasing.

Using purchasing info records

Purchasing info records allow you to store information such as material,vendor, destination plant that is to receive the goods, price with validitydates, and planned delivery time. Info records can be plant-specific, soeach of your facilities using the same vendor and materials can use dif-ferent data such as price or planned delivery time. Data from the info


MEQ1: Maintain Logistics � Materials Management � Purchasing � Master Data � Quota Arrangement � Maintain

MEQ3: Display Logistics � Materials Management � Purchasing � Master Data � Quota Arrangement � Display

MEQ4: Changes Logistics � Materials Management � Purchasing � Master Data � Quota Arrangement � Changes

MEQM: Changes Logistics � Materials Management � Purchasing � Master Data � Quota Arrangement � List Dis-

plays � By Material

MEQ6: Analyze Logistics � Materials Management � Purchasing � Master Data � Quota Arrangement � Follow-On Functions � Analyze

MEQ7: Delete Logistics � Materials Management � Purchasing � Master Data � Quota Arrangement � Follow-On Functions � Delete

MEQ8: Monitor Logistics � Materials Management � Purchasing � Master Data � Quota Arrangement � Follow-On Functions � Monitor

Table 2.7 Quota Arrangements Maintenance Transactions

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records is copied into the purchase order, proposing these predefinedvalues as defaults into the line items.

Note

Info records can be used, not only for materials or services with master re-cords, but also in situations where master records aren’t maintained using ma-terial group and info record short text describing the item you’re purchasing.

Info records have data views that are common for the entire enterpriseand views that are specific to the purchasing organization. Let’s go overeach of the sections in detail because using purchasing info records isthe most commonly used method for procurement process optimiza-tion.

2.8.1 General Data

The top section of the screen houses the common set of data applicableto the entire organization, and you can define details related to yoursupplier (see Figure 2.17).

Figure 2.17 Purchasing Info Record: General Data View


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Vendor dataIn the Vendor Data section, you can maintain reminders (or expediters)in which positive values specify days after requested delivery days andnegative values specify that reminders will be sent x days prior to therequested delivery date. Messages will be issued and sent to your sup-plier. You can also maintain the vendor material number and materialgroup. Vendor Subrange, mentioned earlier in Section 2.4, can beassigned here to provide a link between the material or material groupand the subrange defined in the vendor master. You can also maintainyour supplier sales contact information here, which might be differentfrom the information on the vendor master.

PO UoMThe Purchase Order Unit of Measure section allows you to store thedefault order unit of measure and conversion rate and to activate thevariable purchase order unit.

The Origin Data section gives you details for foreign trade data such ascertificate of origin, country and region of origin, and manufacturerinformation.

In the Supply Option section, you can maintain the validity period forthis source or vendor, and you can also mark this record as Regular

Vendor, which serves the same purpose as a fixed vendor on sourcelists we’ve mentioned earlier in Section 2.6.

2.8.2 Purchasing Organization Data 1

This section is a purchasing organization-specific portion of the inforecord. Here, you can maintain information either for the entire pur-chasing organization and make it plant-specific if needed. In the follow-ing subsections, we’ll discuss the two main sections shown in Figure2.18.

Control Section

The data in this section is applied during purchase order creation andincludes planned delivery time, purchasing group, standard order quan-tity, minimum order quantity, and maximum quantity. If you maintainrounding profiles with the Rndg Prof. field, your requested quantities

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will be converted according the rounding profile rules. For example, anorder for less than the pallet requirement is rounded up to a full palletsize order. By selecting the No MText checkbox, you’ll choose the pur-chasing info record’s PO text over the material master’s purchasing textsduring PO creation. If you require your suppliers to send you theacknowledgement of your purchase order receipt, you’ll need to selectthe Ackn. Rqd checkbox. The Conf. Ctrl checkbox allows you to definea default confirmation control for purchase order material. You can pre-set the required subsequent documents and procedures by choosing, forexample, an inbound delivery shipping notification, a simple confirma-tion, or a rough goods receipt (rough GR).

Figure 2.18 Purchasing Info Record: Purchasing Organization Data 1

You can also assign a tax relevancy in the Tax Code field, which defaultsto your PO line. If you manage your inventory using batch management,you can specify minimum remaining shelf life, which is checked atgoods receipt posting. During goods receipt, the system also checks data


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for overdelivery and underdelivery tolerances that can be preset here ina percentage or an order quantity. If you use blanket POs and want tohave open lines for unspecified amounts of overdeliveries over a certainperiod of time, select the Unlimited overdelivery checkbox. If youchoose to do so, the overdelivery tolerance setting will be cleared.

You can also require material to follow the three-way match procedureby selecting the GR-BSD IV (goods receipt invoice verification) check-box. Some of your vendors may allow for immediate payment uponreceipt of goods using evaluated receipt settlement (ERS). If you wantcertain materials to be excluded from this process and if you require aninvoice document to be presented for payment every time you purchasea material, you’ll need to check the No ERS flag.

Differential invoicing

Other invoicing features are set here as well, such as Differential

Invoicing (a BAdI-activated enhancement), which makes your materialrelevant for differential invoicing so you can enter incoming invoices asprovisional, differential, or final. Shipping instructions allow you to cap-ture vendor compliance with your shipping instructions at the time ofgoods receipt and allows you to track and calculate compliance scores invendor evaluation. If your goods receipt inspection discovers any qual-ity issues with the supplied materials, your supplier may require you toobtain return material authorization before you ship the goods back.You can set the RMA Req. field to match your needs.

Conditions

Pricing and quantity

In the Conditions section, you’ll maintain basic pricing informationand quantity conversion. If you need to maintain scales and multiplevalidity periods, you can do this in the detailed pricing Conditions table(covered further in Section 2.8.3). Selecting the No Cash Disc. indicatorlets the system know that, during purchase order creation, no cash dis-count is granted for the item. You can also define how the pricing date isestablished by setting Pr. Date Cat. field to one of the six predefinedoptions ranging from No Control to GR Date. Incoterms can also bemaintained here.

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2.8.3 Purchasing Organization Data 2

In this simple data section of the purchasing info record, you can main-tain the reference document numbers and relevant validity dates forthese documents. The two types of reference documents shown inFigure 2.19 include your supplier quotation document number and thelast purchase order document number created using the purchasing inforecord reference and the PO date.

Figure 2.19 Purchasing Info Record: Purchasing Organization Data 2

The pricing Conditions button provides access to detailed maintenanceof PO-relevant conditions, including the basic gross price conditionPB00. You can use all standard pricing maintenance functions, includingvalidity dates and scales. Figure 2.20 shows an example maintenancescreen.

Figure 2.20 Purchasing Info Record: Pricing Condition Maintenance

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The Texts button takes you to the purchasing texts maintenance part ofthe purchasing info record transaction. Recall from earlier sections thatthe MTexts field activates the use of purchasing info record texts overmaterial master texts during purchase order creation.

2.8.4 Transactions

Manual generationPurchasing info records can be generated manually using direct transac-tions and automatically during maintenance of quotations, contracts, orpurchase orders. Purchasing info records can also be updated every timea new goods receipt is posted against the PO. Table 2.8 provides a list ofcommon purchasing info record maintenance transactions and menupaths.

2.9 Pricing

Pricing is one of the most important activities in purchasing; you’ll haveto make sure that the price entered in a purchase order is correctbecause the purchase document represents a legal bond between yourcompany and your vendors. You’ll also have to make sure that all of thecosts involved in purchasing a material and bringing it through the dock


ME11: Create Info Record Logistics � Materials Management � Purchasing � Master Data � Info Record � Create

ME12: Change Logistics � Materials Management � Purchasing � Master Data � Info Record � Change

ME13: Display Logistics � Materials Management � Purchasing � Master Data � Info Record � Display

ME14: Changes Logistics � Materials Management � Purchasing � Master Data � Info Record � Changes

ME15: Flag for Deletion Logistics � Materials Management � Purchasing � Master Data � Info Record � Flag For Deletion

MEMASSIN: Mass Main-tenance

Logistics � Materials Management � Purchasing � Master Data � Info Record � Mass Maintenance

Table 2.8 Purchasing Info Records Maintenance Transaction Codes

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doors of your company are considered. These costs include, not only theprice of the material you’re buying, but also all the shipping, handling,and customs costs. Furthermore, you must include all the taxes to whichthe material is subject.

Vendors have list prices, special discounts, volume discounts, and alsosurcharges that may affect the final price of a material. To calculate alldiscounts and surcharges, SAP ERP uses conditions that are determinedbased on rules set in IMG Customizing.

Schema The set of conditions that are valid for pricing are called pricing schemas(as shown in Figure 2.21), and they are determined depending on dataassigned to the purchasing organization and the vendor: the schemagroup for vendor and the schema group for purchasing organization.

Figure 2.21 Pricing Schemas Contain Pricing Condition Types

The schema group for vendor is assigned in the Purchasing Data screenof the vendor master in Transaction MK01 or Transaction MK02 or byfollowing the menu path Logistics � Materials Management � Pur-

chasing � Master Data � Vendor � Create. The schema group for thepurchasing organization is assigned in the system configuration in IMG

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Customizing or by following the menu path: Materials Management �Purchasing � Conditions � Define Price Determination Process �

Determine Calculation Schema for Standard Purchase Orders.

If you’re a functional analyst, then you’ll need to configure differentpricing schemas that contain different conditions depending on yourpricing needs. You’ll also need to configure schema groups for vendorsand schema groups for purchase organization and then configure theschema determination according to the combination of their values (seeFigure 2.22).

Figure 2.22 Pricing Schema Determination

2.9.1 Using Conditions in Purchasing Documents

After the pricing schemas and their determinations are configured, youcan start using those conditions in purchasing documents. Each pricingschema contains header and item conditions, referring to where theseconditions can be used. Some conditions can even be set as available foruse on both the header and the item levels.

Purchasing info record conditions

The conditions you enter in the purchasing info record are valid onlyfor one material when it’s purchased from a specific vendor. To enter

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conditions that apply for all the items you buy from a vendor, all theitems in a material group, or all the items included in a contract, youcan use condition records.

To enter conditions in a purchasing info record, follow these steps:

1. In the Purchasing Organization view of Transaction ME11 or Trans-action ME12, enter a price and a price unit.

2. Click on the Conditions button.

3. If you’re changing an info record, you’ll see a list of validity dates forconditions; select the one that applies to your prices.

4. On the Change Gross Price Condition screen (see Figure 2.23),enter new conditions as required. For example, for condition FRB1for freight value, enter the value in your document’s currency andpress the (Enter) key.

5. Save your info record.

Figure 2.23 Change Gross Price Condition Screen

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2.9.2 Condition Records

Display pricingYou can create condition records to make prices appear in purchasingdocuments. Condition records are master data entries that create a com-bination of elements called a condition. The elements in the conditionare set in IMG Customizing, and each of these condition settings iscalled a condition type. In the example shown in Figure 2.24, the condi-tion record will give the company a 13% discount when they buy mate-rials using purchasing organization 3000; for everything the purchasingorganization buys from vendor 3902, SCT, Inc., the condition recorduses condition type RL01.

Figure 2.24 Create Vendor Discount Condition

Condition fulfillment

Condition records are created in Transaction MEK1 or by following themenu path: Logistics � Materials Management � Purchasing � Master

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Data � Conditions � Other � Create. To create a new condition record,follow these steps:

1. Choose a condition type, for example, LP00 for an incomplete palletsurcharge.

2. Select a key combination by clicking on the Key Combination button.These key combinations refer to the combination of field values thatwill make this condition relevant in a purchasing document. For ourexample condition type LP00, select Vendor.

3. Enter the values for all of the fields or elements. The values in thesefields are compared to the values in a specific purchasing document orin the purchasing info record. When the values match the onesentered in the condition record, the system considers the conditionfulfilled and then includes that condition type in that document. Inthe LP00 surcharge for a vendor example, enter the vendor number,the amount of the surcharge in the vendor’s currency, and the priceunit. Also enter the validity period for this condition record and save.

Entering Price Conditions

Two types of conditions are used in a purchasing document: header con-ditions and item conditions. Item conditions have the individual pricingelements for each line in the purchasing document, and the header con-ditions include pricing elements that apply to the whole document. Theheader conditions also include the sum of all the individual item condi-tions, ultimately calculating the total document (order) value.

To enter price conditions on a purchase order in Transaction ME21N orTransaction ME22N or by following the menu path: Logistics � Materi-

als Management � Purchasing � Purchase Order � Create � Vendor

known. As shown in Figure 2.25, follow these steps:

1. Enter the material number, the quantity, and the price in the Item

Overview section of the PO.

2. In the Item detail section, select the Conditions tab.

3. At the bottom, enter new conditions as required. For example, forcondition FRB1 for freight value, enter the value in your document’scurrency and press the (Enter) key.

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Figure 2.25 Fulfilled Conditions in the Purchasing Document

2.10 Taxes

In the Purchasing subcomponent, you’ll have the option to determinetaxes in the purchasing documents (purchase orders, purchasing con-tracts, or scheduling agreements) or not and then to let the follow-upprocess of invoice verification do the calculation. You can also use thesame condition determination described in the previous section for pric-ing to determine taxes in purchasing documents.

Tax master dataIn either case, you must maintain certain data to make your purchases taxrelevant. One is a configuration setting for the plant; your system analystneeds to make sure that the right tax indicator is set for the plant orplants for which you’re executing the purchases. You can set tax indicatorin IMG Customizing by following the menu path: Materials Manage-

ment � Purchasing � Taxes � Assign Tax Indicators for Plants, asshown in Figure 2.26.

To configure taxes, in IMG Customizing, follow the menu path Materi-

als Management � Purchasing � Taxes � Set Tax Indicator for Plant

to set that plant as relevant for tax determination. Then, set the tax rele-vance for each vendor and for each material, which is customizable

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because not all vendors fall in the same tax category; import vendorsmay not charge a sales tax, for example. In the same way, some materialsmay fall into categories that make them tax exempt.

Figure 2.26 Setting the Tax Indicator for Each Plant

2.10.1 Adding Tax Relevance

Tax relevance is determined in the purchasing documents for each lineitem. When you define that all three elements—plant, vendor, andmaterial—are relevant for some kind of sales tax, then those elementsare adopted by the document.

Tax relevancefor materials

The tax relevance for each material is set in the material master in thePurchasing view. You’ll need to maintain the Tax Ind. f material field.This field requires that you previously set the different options in IMGCustomizing, which we discussed in Section 2.2.2.

To add tax relevance to a material as shown in Figure 2.27, follow thesesteps:

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1. Use Transaction MM02, or follow the menu path: Logistics � Materi-

als Management � Material Master � Change � Immediately. Next,select the Purchasing view.

2. Enter the plant and purchasing organization for which you’re makingthe change.

3. In the Tax ind. f. material field, enter the appropriate value.

Figure 2.27 Purchasing View of the Material Master

Tax relevance for vendors

Similarly, the tax relevance for vendors is set in the vendor master in theControl view in the Sales/pur.tax field (see Figure 2.28). Selecting thischeckbox indicates that this vendor will add a sales tax in its salesinvoice.

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Figure 2.28 Setting the Sales/Purchasing Tax Flag in the Vendor Master

2.10.2 Adding the Tax Code

Additionally, you’ll need to enter the appropriate tax code in the pur-chasing info record. This defaults the correct tax code in the Invoice tabof the Item detail section of a purchase order, for example, as shown inFigure 2.30. Keep in mind that purchasing info records have to be cre-ated for each material/vendor/purchasing organization combination.

For vendors To add tax relevance to a vendor, as shown in Figure 2.29, follow thesesteps:

1. Use Transaction MK02 or follow the menu path: Logistics � Materi-

als Management � Purchasing � Master Data � Vendor � Purchas-

ing � Change). Select the vendor number and the purchasing organi-zation.

2. Select the Control data view and press (Enter).

3. In the Tax Information section, enter all of the tax-relevant informa-tion for the vendor and click Save.

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Figure 2.29 Setting the Tax Indicator in the Purchasing Info Record

Figure 2.30 Purchasing Documents with the Tax Code from the Info Record

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Note

The tax code is set in IMG Customizing by the finance areas, and each taxcode can be assigned a different tax percentage, so make sure to consult withyour finance department for details about the right code to use.

2.10.3 Creating Condition Records

So far, by using this basic master data, purchasing documents can deter-mine whether items are relevant for taxes, and specific tax codes can becopied from purchasing info records. If you need your purchasing doc-uments to explicitly show the amount for taxes, then you’ll need to cre-ate condition records for them.

Rules for plantsand tax codes

As we explained in Section 2.9, condition records are the set of rulesthat help determine if an entry in the purchasing document is relevantor complies with that condition. So you can create condition records forimports, condition records for domestic purchases, for different plants,and for different tax codes, as shown in Figure 2.31.

The standard SAP ERP system condition for taxes is called NAVS, andyou’ll have the option of creating entries based on different combina-tions of the following key fields: tax indicator for material (Tax ind.), taxindicator for plant (TaxIndPlant), country of origin (Import), destina-tion (Destination Country), and account assignment. A tax percentageand a tax code have to also be entered.

Condition records for taxes are created in Transaction MEK1 or by fol-lowing the menu path: Logistics � Materials Management � Purchas-

ing � Master Data � Taxes � Create.

Create To create a new condition record, follow these steps:

1. First, choose the condition type NAVS for non-deductible tax.

2. Select a key combination by clicking on the Key Combination button.A few options are available depending on how your purchases aretaxed. Choose the one that applies to your business.

3. Enter the values for all the fields or elements. The values in these fieldswill be compared to the values from a specific purchasing document,

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specifically the material’s and plant’s tax indicators, and the systemwill check whether the purchase is domestic or an import.

Figure 2.31 Condition Record for Taxes Based on Country of Destination, Tax Indicator for Material, and Tax Indicator for Plant

4. When the values match the ones entered in the condition record, thesystem considers the condition fulfilled and then includes that condi-tion type in that document. At this point, the value you enter for thetax percentage you entered in the previous step is brought to the pric-ing schema of the purchasing document.

Creating and main-taining pricing conditions

5. When the combination of the values of these fields fulfills the condi-tion record, the percentage and tax code are adopted by the purchas-ing documents and they are added to the total value of the order, asshown in Figure 2.32.

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Figure 2.32 Non-Deductible Tax When the Conditions Are Fulfilled

Table 2.9 lists the transactions and menu paths that will help you createand maintain condition records.


MEK1: Create Conditions Logistics � Materials Management � Purchasing � Master Data � Conditions � Other � Create

MEK2: Change Logistics � Materials Management � Purchasing � Master Data � Conditions � Other � Change

MEK3: Display Logistics � Materials Management � Purchasing � Master Data � Conditions � Other � Display

MEKE: By Vendor Logistics � Materials Management � Purchasing � Master Data � Conditions � Discounts/Sur-

charges � By Vendor

MEKF: By Material Type Logistics � Materials Management � Purchasing � Master Data � Taxes � Material Type

Table 2.9 Condition Records for Pricing

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2.11 Other Master Data

Of the many other complete sets of master data in the SAP ERP system,some interact directly with the Purchasing subcomponent and somedon’t. Let’s discuss routes and batches because they play important rolesin some purchasing business scenarios.

2.11.1 Routes

Stock transport orders

Routes are used in Purchasing primarily in stock transport orders. Thesetypes of orders include a Shipping tab in the Item details section, whichtakes shipping and sales data from the material, the plant, the storagelocation, and the ship-to address. This information is used to determinea shipping point and a route that are used to create an outbound deliv-ery in the shipping plant.

Other purchasing processes that use a similar determination, and thusroutes include returns to vendors with delivery and subcontracting withdelivery. These processes also require that your material, plant, and ven-dor include sales information to determine all of the shipping data,including the route.

Routes are part of the SAP Transportation Management master dataobjects and include a point of origin, a point of destination, sometimeswaypoints in between, and, most importantly, a travel time. Thesetravel times directly affect the purchasing lead times and are included inpurchasing documents if an inbound delivery is being used. Longer leadtimes are also translated into earlier planning of materials, which meansthat MRP will generate the material requirements while taking intoaccount this information.

Routes are created by the Logistics Execution (LE) or Sales and Distribu-tion (SD) teams, and you’ll need to make sure that these teams knowabout your requirements for shipping between plants and returns orshipping to vendors so that they can also create the routes your processneeds.

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2.11.2 Batches

Some industries, such as pharmaceutical or food, rely completely onbatch management to know when their raw materials, semifinishedproducts, and finished products were manufactured; when they expire;and where they’ve been used in the manufacturing process. Batches alsohelp them know which customers the final products were sold andshipped to.

Batch information is used and kept throughout the entire logistics pro-cess. You can buy specific batches when you order raw materials fromyour vendors, or they can be captured upon receipt in the warehouse.You can determine exactly how much stock you have of any given batchin storage and when the expiration date is. You can also determine if amaterial can be received into stock based on the manufacturing date andthe remaining shelf life.

Batch definition To use batches, you’ll need to first configure how batches are defined inthe system. You can set the system as the following:

� Batch Unique at plant level With this setting, the system allows the same batch number for thesame material in different plants.

� Batch Unique at material level With this setting, the system has a unique batch number for a materialacross plants.

� Batch Unique at client level for a material With this setting, no two batch numbers will be the same, indepen-dent of material and plant.

You can configure batches in IMG Customizing by following the menupath: Logistics General � Batch Management � Specify Batch Level

and Activate Status Management.

Then for every material in Transaction MM02 (Logistics � Materials

Management � Material Master � Material � Change � Immediately),you’ll have to set the Batch management flag in any of the plant-levelviews of the material master: Sales/Plant Data, Purchasing, or Plant

Data/Storage.

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2.12 Summary

In this chapter, we covered a range of master data objects that you canuse in procurement functions. We identified influential master dataobjects such as material master, service master, business partners,source lists, quota arrangements, purchasing info records, pricing, taxes,routes, and more. Depending on your procurement processes, you mayneed to use all or just a few of them, and reading this chapter shouldhelp you identify, maintain, and describe the relationship of those dataobjects to your procurement process with ease.

Based on the information we’ve covered, you may feel overwhelmed bythe volume of master data to maintain, which is why keeping the dataclean all the time is important.

Now, together with the information from Chapter 1 that introduced youto the procurement enterprise structure of your company and armedwith the wealth of information about master data, we’re ready to moveon to Chapter 3, where we’ll begin dissecting the procurement pro-cesses starting with planning and forecasting.

517

Index

A

AC03, 55AC06, 55Account assignment category, 214Account group, 56, 57Account management, 59Accounting, 443

codes, 444document, 449, 450, 459key, 444view, 444, 445

Accounts payable, 49Acknowledgement, 82, 387

confirmation, 388required, 389

Activate a strategy, 214Activity number, 52Actual costing

SiT, 296Actual goods receipt matching, 392Address, 58Advanced shipping notification, 384ALE, 161Allocation, 464

criteria, 467Alpha factor, 128Alternative purchasing data, 120Amount, 465Amount to be posted, 445Analyses, 238, 248Analysis, 232ANSI, 176Application

EF, 189Application Link Enabling, 161ASN, 384Assign delivery type and checking rule

node, 256Assign delivery type to PO document

typeSiT, 298

Assign workflow, 218Auditable, 440Automatic calculation

of reorder point, 114of safety stock, 114

Automatic load builder, 355, 357Automatic load building, 351Automatic model selection, 126Automatic PO field, 46Automatic posting, 444, 450

configuration, 450Automatic posting to a vendor

account, 293Automatic reorder point planning, 108Automatic settlement, 477Availability check, 288, 317Available materials, 18Average daily requirements, 109

B

Background verification process, 468Balance, 465Base unit of measure, 43

field, 53Basic data

section, 53view, 43

Batch, 100management, 82

Batch Management, 441Beta factor, 128Bill of lading, 273, 447, 466Bill of materials, 17Blocked, 441Blocked invoice, 472, 484Blocking invoices, 462, 470Blocking reasons, 472

delete, 472BOM, 76Business partner, 55, 56Buying side, 24

Index

518

C

Cancelling invoice document, 485Cash discount, 162, 172CEBAN, 216CEKKO, 216Central purchasing organization, 160Centralized purchasing, 33Certificate of origin, 81Change in stock type, 459Change in the stock levels, 459Change Invoice icon, 470Change ownership, 452Characteristic, 216Characteristic values, 138Characteristics field catalog, 137Check-in, 426Class, 216Classic Kanban, 329, 332Classic scenario, 25, 26, 27Client, 32Collective release, 374Collective shipment, 420

processing, 427Company code, 32, 441Compare performance, 235Competitive products, 41Component, 17, 19

Controlling (CO), 20Financial Accounting (FI), 19Human Resources (HR), 22Logistics Execution (LE), 21Materials Management (MM), 21Plant Maintenance (PM), 21Production Planning and

Control (PP), 21Quality Management (QM), 21Sales and Distribution (SD), 20SAP Project System (PS), 20

Compute the scores, 227Condition, 83, 86

section, 61Condition determination, 91Condition fulfilled, 90, 97Condition record, 88, 96

create new, 90, 96for domestic purchases, 96

Condition record (Cont.)for imports, 96

Condition records, 433Condition type, 89

RL01, 89Conditions, 166Confirmation, 82

control, 82manual, 390monitor, 390order acknowledgements, 390rough receipt, 392

Confirmation control, 384assignment, 387define for vendor in purchasing org, 385key, 386options, 384shipping notification, 395

Confirmation date, 231Confirmations control, 393Consignment, 76, 182, 441, 451, 452

agreement, 441automated settlement procedures, 481

Consignment item, 443Consignment PO, 452Consistent planning, 136Constant model, 124Consumption, 16, 109

requirements, 107values, 135

Consumption indicator of forecast, 113Consumption-based planning, 103,

107, 110Contact person, 56, 59Contract, 71, 77, 151

create, 161release order, 166validity end date, 162, 172

Contract Management, 22Contract manufacturer collaboration, 28Control cycle, 330, 332Control data, 58

section, 61Control section, 81Control view, 93Conversion field, 54Correspondence, 59

Index

519

Cost center, 450Cost-effective size, 347Country of origin, 81Create invoice

automatically, 466manual entry, 463

Creation profile, 67Credit memo, 225, 461

park, 473Credits

process, 483Cross plant material status, 43Cross-company code, 281

STO, 255stock transport order, 281

Cross-company purchase order, 289, 318Cross-company STO, 287Cross-company STO process

SiT, 297, 299Cross-company vendor, 285Currency, 184Customer, 56, 223Customer collaboration, 28Customer master, 259, 285, 307

change, 67, 68, 70, 73create, 67, 68display, 67

Customer order stock, 453Customs costs, 86

D

Daily buckets, 169Daily requirements, 168Debits

process, 483Decentralized warehouse

management, 403Decentralized/localized purchasing, 34Default Data Material section, 61Define delivery types

SiT, 297Define Schedule Line Categories

node, 258Delays in deliveries, 238Deletion Indicator field, 53DELFOR01 IDoc, 176

Delivery, 231date, 169, 226

Delivery cycle, 66Delivery document

copy control, 285Delivery due list, 276Delivery note, 466Delivery note number, 447Delta factor, 128Delta planning, 136Demand planning and forecasting, 28Dependent requirements, 114Different prices in each plant, 444Differential invoicing, 83Direct procurement, 26Discounts, 40Distributed SAP ERP systems, 160Distribution channel, 223Distribution planning, 28Division, 223Division field, 53Document flow, 255Document type, 213

CCTR, 160DC, 160MK, 160MK contracts, 165quantity contract, 167value contracts, 167WK, 160WK contract, 165

Drilldown levels, 250

E

EAN, 42EDI, 176, 189, 384EDI invoice, 482

processing, 481EDI processing, 481EDIFACT, 176Electronic communications, 176Emails, 176Enhancement M61X0001, 145Enjoy initiative, 446Enterprise structure, 31ERS, 83

Index

520

ERS procedure, 472ERS relevancy, 477E-sourcing, 25Evaluated receipt settlement, 83, 477Evaluation, 147Evaluation calculation, 233Event-driven Kanban, 330, 332Execute forecast, 135Execute picking, 273, 277, 290, 312, 318Execute planning, 143Expediters, 81Expenditure analysis, 22Extended classic, 25Extended classic scenario, 26Extended inbound delivery cockpit, 407Extended inbound delivery processing

create shipment, 430External number range, 56External procurement, 116External send, 189External service, 183

provider, 227External services

tables, 498

F

Fax output, 189FI invoice document, 462Field status, 56, 57Finished, 442Finished good, 17Finished goods, 41Firm zone, 168, 177Firming type option, 113Fixed source, 71Fixed vendor, 81Flexible planning, 103, 135Follow-On Docs icon, 470Forecast, 18

execute, 130optional parameters, 127

Forecast control data, 126Forecast indicator, 113Forecast model, 124, 127Forecast profile, 140, 141

in SOP, 141

Forecast requirements, 109Forecast zone, 168Forecast-based planning, 109Forecasting, 122, 168, 486

model, 122tables, 494transaction codes, 131view, 116

Foreign trade data, 81Forwarding agent, 426Freight cost, 436Future requirements, 133

G

Gamma factor, 128General data, 52Generating schedule lines, 175Global value, 164Go ahead for build and ship, 168Goods delivered for purchase orders,

238Goods from production, 442Goods issue, 265, 450

for an STO, 454Goods issue to STO delivery, 290,

313, 319Goods issued, 225Goods receipt, 82, 267, 290, 292, 445,

450, 461capacity check, 341for stock transfers, 446Invoice Verification, 83option, 280post in receiving plant, 266processing time, 47

Goods receipt document, 374Goods receipt-based Invoice

Verification, 477Gross price, 84

H

Handling, 86Handling unit management, 431Header and items, 449Header conditions, 90

Index

521

Help, 464Hierarchy, 367Hierarchy node, 69Historical consumption values, 133Hybrid purchasing organizations, 35

I

IDoc, 189ORDERS01, 389

IMG, 220IMG configuration, 116IMG customization, 119IMG customizing, 111Inbound delivery, 383, 384, 388, 406

create, 401create en masse, 399create manually, 400display in cockpit mode, 407group shipments, 421

Inbound delivery cockpitprocess document, 407

Inbound delivery monitor, 403reporting tools, 406

Inbound logistics, 383Inbound shipment, 419, 421Incoming inspection, 226Incoming invoice, 482

receipt, 294Incoterms, 83Indirect procurement, 25Individual forecast, 130Individual shipment, 420Info record, 153

create, 501Info system, 248Infostructure, 137, 138

maintenance transaction codes, 137Initial stock entry, 446Insurance, 59Interactive check, 147Intercompany AP invoicing, 281Intercompany billing, 291, 322

document, 281, 291, 293, 321Internal work section, 54Intracompany STO process

SiT, 297, 303, 310

Inventory account, 443Inventory adjustment, 16Inventory document, 449Inventory Management, 255, 439

tables, 498Inventory management, 15Inventory valuation, 439Inventory Valuation and Control, 17Investment buy, 494Investment buying, 340, 341

simulation, 342Invoice, 231, 464

allocation, 464balance, 464block, 470cancel, 485create automatically, 466create via EDI message, 293, 322date, 464enter manually, 293, 322header, 464help, 464items, 464link to shipment, 432park, 473PO Structure, 463process subsequent debit/credit, 483processing, 462receipt, 461receipt for cross-company purchase

order, 293, 322release, 470reversal, 461, 462save incomplete, 473transaction, 464vendor data, 464verification, 462worklist, 463

Invoice overviewbatch run records, 468

Invoice postingautomatic settlement, 462background processing, 462manual entry, 461

Invoice receipt, 49Invoice Verification, 50, 376

in the background, 469

Index

522

Invoice Verification (Cont.)process, 470

Invoice verificationtables, 499transaction codes, 491

Item category, 72determination, 282, 299, 303U, 263

Item conditions, 90Item overview, 447Item texts, 184Item View, 406Items for services, 366

K

Kanban, 327board and signals, 336Calculation tab, 335control cycle categories, 329master data, 330one-card, 330print card, 335quantities, 337set to EMPTY, 334set to FULL, 334set to WAIT, 334with quantity signals, 330

Key fields, 96Key figures, 250

L

Layouts opion, 409Lead times, 99Lean production, 327Level-by-level planning, 136List displays, 238List price, 86Lists of shipment costs, 436Load builder, 66, 340

analysis results, 351Load building, 347, 351, 494

configuration check for, 349parameters, 357process overview, 348results list for, 355

Loading end, 426Loading group, 259, 261Loading start, 426Logistics, 16, 255

outbound delivery, 268Logistics controlling, 249Logistics Invoice Verification (LIV), 461Logistics Service Parts Management, 398Logistics structure, 441Long Text section, 54LO-SPM, 407Lot Size, 121Lot-sizing procedure, 106, 108, 110LSMW, 446

M

Main criterion, 229Maintain forecast, 135Maintaining vendor master data, 67Manual model selection, 126Manual model selection with additional

checks, 126Manual payment block, 470Manual reorder point planning, 108Manufactured item, 443Manufacturer field, 48Manufacturer part number field, 48Manufacturing, 28Manufacturing date, 447Master data, 18, 385

confirmation controls, 385planning, 111Transportation Management, 99

Master production scheduling, 15, 113Material, 250Material account, 461Material document, 268, 275, 459Material forecast profile, 128Material group, 42, 80, 214, 443Material loading group, 269Material master, 18, 39, 40, 185, 261,

285, 308, 445forecasting view, 135record, 444tables, 491views, 42

Index

523

Material master record, 121Material movement, 440Material number, 43Material requirements planning � MRPMaterial status, 441Material type, 443Material/service group field, 53Materials document, 449Materials exclusions indicator, 73Materials Management, 226

invoice document, 462LIV, 461

Materials requirements planning (MRP), 17

Maximum amount, 166Maximum order quantity, 81Maximum quantity, 166MBXX transactions, 446MEDRUCK, 189Message

create, 189Message Log icon, 470Microsoft Project, 369Minimum order quantity, 81Minimum remaining shelf life, 82MM component, 237MM organizational structures, 31Model initialization, 127Model selection, 126Monitor confirmations, 391Monitor stock levels, 108Monthly requirements, 168Movement type, 444, 454, 456, 457

101, 275122, 222641, 275643, 290, 312, 318

Movement type determination, 282, 299Moving average, 125MRP, 103, 107, 110, 113

area, 111, 114, 118, 119, 128controller, 111, 145customize list, 150group, 119, 120indicator of forecast, 114list, 148procedure, 103, 104, 107, 112

MRP (Cont.)type, 111, 121, 122view, 116

MRP 1 View, 121, 128MRP 1 view, 119, 120MRP 2 View, 121MRP List field, 146MRP list transaction codes, 149MRP system, 16, 175MTexts, 85Multicurrency, 20Multilevel product group, 138

N

NAVS, 96Net requirement, 105, 108, 109, 110Net requirements calculation, 105Net Weight, Gross Weight, and Volume

fields, 44Non-stock materials, 41Number of packages, 448Number range, 56

O

Object List menu, 409One-step stock transport order with

outbound delivery, 268On-hand inventory, 267On-time delivery, 231Opened item, 449Optimized purchasing, 79Oracle Primavera, 369Order acknowledgement, 388

confirmation controls, 385Order fulfillment, 28Order optimizing, 339, 347Order Unit field, 46ORDERS/ORDCHG, 189Origin Data section, 81Orphan requirements, 169Other forecast models, 125Other goods receipts, 446Outbound delivery, 259, 281, 292

create, 270, 276, 289, 312, 318Outbound delivery monitor, 403

Index

524

Outbound delivery typeNLCC, 281, 296

Outline agreement, 159Outline level, 367Outline subgroup, 368Output, 176

NEU, 189Output condition

RD04, 293, 322Output condition record, 189Output conditions, 395Output type, 176

LPH1, 176Overall score, 232Overall value limit, 365Overdelivery tolerance, 83

P

Packaging materials, 41Palletize the quantities, 448Parallel processing, 144Parent-child relationship, 367Park

credit memos, 473invoices, 462, 473

Parking functionality, 473Partner function determination

schema, 63Partner functions, 62Partner role, 62Payment transactions, 59Periods per seasonal cycle, 127Permissible partner roles, 62Person responsible, 331Physical inventory count, 450Pipeline materials

automated settlement, 481PIR, 105, 114Plan regularly, 113Planned delivery time, 79, 81Planned Independent Requirement, 142Planned Independent Requirements, 17Planned order, 77Planning, 254

tables, 493

Planning at the storage location level, 115

Planning calendar, 110, 111, 120, 121maintenance transactions, 122

Planning cycle, 66, 113Planning hierarchy, 138

maintenance, 138maintenance transaction codes, 138

Planning horizon, 168Planning Mode field, 146Planning procedures, 103Planning requirements, 138Planning table entry maintenance

transactions, 144Planning with MRP areas, 116Plant, 32, 214, 250, 331, 441, 444

level, 441Plant MRP area, 117Plant-based pricing conditions, 160Plant-specific material status field, 46Plant-specific purchasing, 34Plant-to-plant transfer postings, 255PO

cross-company code, 287PO Create

manually, 185PO create

automatically, 185manually from requisition, 185semi-automatically, 185

PO header, 183PO history, 255PO structure, 463PO structure pane, 465Post goods issue, 277, 290, 312, 318, 320

in issuing plant, 264Post goods movement, 273Post goods receipt, 280, 292, 314, 444,

449Post into inspection, 47Posting invoices, 480Posting rules by movement type, 444Price, 40, 226

variance, 231Price history, 230Price level, 230

Index

525

Pricing condition, 84types, 86

Pricing conditions, 163, 173, 433Pricing scales, 345Pricing schema, 86Print output, 189Process control parameters, 146Process Control Parameters section, 147Process Runner, 446Process-dependent requirements, 106Processing Key field, 146Processing log, 429Processing requirements, 360Processing section, 472Procurement, 28, 32, 255

main criteria, 226service, 359tools, 16

Procurement proposal, 105, 136, 340Procurement services

requirement, 360Procurement tools, 513Product group, 138Product hierarchy, 42Product Hierarchy and Material Group

fields, 44Production of goods, 442Production order, 16, 445Production planning, 15Production scheduling, 15Production supply area, 331Production version, 76Program

RM08RELEASE, 471RMBABG00, 466, 468

Project management system, 369Proof of delivery, 314Proportional factors, 138Purchase document, 85Purchase of services, 359Purchase order, 16, 39, 72, 77, 80, 84,

91, 152, 161, 171, 182, 226, 264, 265, 267, 292, 393, 445, 449, 465, 479, 483acknowledgement confirmation

category, 388apply defined confirmation

processes, 385

Purchase order (Cont.)collective processing of, 399create automatically, 185create for expensed item, 509create for stock material, 505create for subcontracting, 507, 508create from requisition, 504create from requisition for service, 370create manually, 187create output, 189individual processing of, 400multiple order acknowledgements, 390option, 280text, 82type UB, 269, 310unit of measure, 81

Purchase order historyadjustments, 484

Purchase Order/Scheduling Agreement option, 465

Purchase requisition, 72, 73, 152, 154, 161, 171convert, 288convert to PO, 186, 504converting to purchase orders, 347create for unplanned service, 361

Purchasing, 15, 17, 226, 439agreement, 154component, 151group, 250info system, 248information, 238organization, 160, 165, 250process, 151

Purchasing contract, 91Purchasing Data section, 54Purchasing document, 90, 91Purchasing document for services, 370Purchasing document order type

UB, 263Purchasing documents

tables, 494Purchasing group, 37, 81

field, 45Purchasing info record, 71, 79, 84, 85,

94, 345, 385, 387, 462, 477conditions, 84

Index

526

Purchasing info record (Cont.)confirmation control, 387general data, 80maintain data, 387maintenance transaction codes, 85Purchasing Organization Data 1, 81Purchasing Organization Data 2, 84texts, 85

Purchasing organization, 33, 34, 86Purchasing sourcing data

tables, 493Purchasing Status field, 54Purchasing value key field, 47Purchasing view, 44, 45PURCHIS, 248Putaway, 403

Q

Quality, 230audit, 226

Quality control, 441Quality inspection, 40Quality Management, 226Quality requirements, 443Quantities, 226Quantity, 447

contract, 160, 165, 167optimizing, 343reliability, 231variance, 231

Quota arrangement, 71, 74allocated quantity, 77maintenance transactions, 79maximum lot size, 77maximum quantity, 77minimum lot size, 78once-only indicator, 78procurement plant, 76procurement type, 76production version, 76quota, 76quota in %, 77rounding profile, 78special procurement type, 76usage, 77usage field, 47

Quota base quantity, 77Quotation, 84

R

Ranking list, 232Raw materials, 33, 41, 442Receipts without PO, 446Receive a purchased item, 443Receiving, 442Receiving plant, 454Reduce forecast option, 114Reference document, 84, 162, 172, 402Reference purchase order, 482Reference purchasing organization, 36Regenerative planning, 144Region of origin, 81Regular Vendor, 81Release, 168

code, 217group, 217indicator, 213, 215, 218point, 215

Release blocked invoices manually, 472Release code

create, 214Release strategies, 374Release strategy, 212, 213, 218

determine, 215with classification, 215without classification, 213

Releasing invoices, 470, 484Relevancy for billing

SiT, 302Relevant for tax determination

material, 91plant, 91vendor, 91

Remaining shelf life, 100Reminders, 81Reorder point planning, 107Replenishment lead time, 107, 335Replenishment signal, 330Report

MIR6, 468, 469Reporting, 237

Index

527

Reports, 237conditions/prices, 242outline agreements, 247purchase orders, 247purchase requisitions, 245PURCHIS, 252quota arrangements, 241source lists, 241vendor, 241vendor evaluation, 242

Request for proposal, 22Request for quotation

RFQ, 152Requirement, 360Requisition, 77

create without specification, 363Requisitions for service

create contract/PO, 370Return material authorization, 83Return to vendor, 221, 223Returns in Inventory Management, 222Returns Items field, 223Returns scenarios using SiT, 324Returns to vendor

in Purchasing, 223Revaluation, 482Reversal Reason field, 485Reverse, 486

button, 486Reverse auctions, 22Revoke acceptance, 374RFQ

create for unplanned service, 364price comparison report, 157quotation, 154saving the quote to an Info Record, 156submit quotes, 152

RFQ process, 185RFQ/quotation, 161, 171Roll forward option, 113Rolling schedule, 168Rough goods receipt, 385

document, 393Rough GR, 82Rough receipt, 392Rounding profile, 81, 344Rounding rule, 345

Rounding value, 346Route, 421Routes, 99

S

Safety stock, 105, 108Safety stock planning, 28Sales and Operations Planning (SOP),

103Sales area, 261Sales area data, 259Sales Data section, 61Sales forecasts, 15Sales organization, 223Sales requirements, 114Sales views, 223Sales/pur.tax field, 93SAP AG, 15SAP BusinessObjects, 25SAP Contract Lifecycle Management, 25SAP ERP, 22SAP E-Sourcing, 22SAP General Ledger, 20, 440

account, 461post to, 450post to accounts, 450posting, 456

SAP HANA, 28SAP Plant Maintenance, 359SAP Project System, 359SAP Retail, 395

rough receipt, 392SAP SCM, 27SAP Sourcing, 22SAP SRM, 22, 23, 24

deployment scenarios, 25SAP Supplier Lifecycle Management, 23SAP Supplier Relationship

Management, 23SAP Supply Chain Management, 27SAP TM, 28SAP Transportation Management, 28SAP Warehouse Management, 273, 396SAP WM-managed location, 448SAP-delivered subcriteria, 229Scales, 84

Index

528

Schedule Background Job icon, 470Scheduling, 106, 109, 110, 111Scheduling agreement, 71, 77, 91,

151, 168horizon, 169

Schema group for purchasing organization, 86

Schema group for vendor, 86Scope of planning, 145Scrapping, 450Seasonal model, 125Seasonal trend model, 125

smoothing factors, 128Sell side, 23Semifinished, 442Service, 250Service agreement, 377Service Category field, 53Service confirmations, 371Service Data section, 61Service entry, 461

sheet, 466Service entry sheet, 50, 368, 437

collective release, 375create new, 372document, 433GR/IR clearing, 376

Service master, 361, 366services, 370

Service master recordpurchase service, 370

Service Parts Management, 407, 430Service procurement, 27Service short text, 52Service Type field, 53Services, 41

accept, 374create contracts, 378document items, 366full screen, 367multiple, 371one-time, 363outline, 367procurement, 359release contracts, 380revoke acceptance, 374specifications, 366

Services (Cont.)subitem level, 366unplanned, 360

Set up a strategy, 214Shipment

collective processing, 427completion, 427costing tables, 496create with extended inbound delivery

processing, 430process individual, 422tracking, 427

Shipment cost document, 432, 433collective processing, 436create, 434

Shipment cost settlementautomatic PO, 434

Shipment costing, 426document, 432relevancy, 426

Shipment costssettlement, 433

Shipment document, 480Shipment end, 427Shipment start, 427Shipping, 86

address, 40instructions, 83notification, 82tables, 495

Shipping condition, 260, 269Shipping Conditions field, 259Shipping data tab, 269, 276, 311Shipping notification, 177, 385, 395

DESADV01, 177monitor, 403

Shipping point, 260Shipping point determination, 269Shipping Point field, 271Shipping tab, 288, 317Ship-to account, 223Single-item planning, 145Single-item, at single-level planning, 145Single-item, with multilevel

planning, 145Single-level planning transaction

codes, 147

Index

529

SiT movement type determinationSiT, 299

SKU number, 42SOP, 135

functionality, 142process steps, 142

Source list, 71, 166, 175create, 503maintenance transactions, 73

Special discount, 86Special procurement type, 116Special stock, 451, 453

indicator, 451number, 451, 453

SPED output type, 315Standalone scenario, 26Standard, 182

purchase requisition, 213Standard analyses, 248, 249Standard order quantities, 345Standard order quantity, 81Standard purchasing organization, 36Standard service catalog, 370Standard Service Category section, 53Statement of work, 366Statistical information, 248Steps for release, 213STO

create, 263, 275master data, 259purchase order, 265two-step with outbound delivery, 275with outbound deliveries, 256with outbound delivery, 254without outbound delivery, 254

STO with outbound deliverytwo-step process, 256

Stochastic blocking, 470Stock

special, 451Stock category, 459Stock differences, 450Stock in transit, 295, 454

STO, 294Stock provided to vendor, 453

Stock Requirements List, 149Stock transfer, 182

procurement key, 262Stock transfer between storage

locations, 256Stock transfer from another plant, 116Stock transfer within plant, 116Stock transport order, 253, 256, 269,

310, 454create, 269, 288, 316

Stock transport purchase order, 116Stock/requirements list, 150

transaction codes, 150Stocks of materials, 441Stocks owned by the vendor, 441Storage location, 33, 223, 331, 441, 447Storage location MRP area, 117Storage unit, 448Strategy assigned, 213Subcontract

outbound delivery, 205Subcontracting, 76, 182, 193, 453

BOMs, 197master data, 193PO creation, 202process flow, 200purchasing info record, 195

Subcontracting vendor, 117Subcontractor, 441Subcriteria, 227Subsequent credit, 462, 483Subsequent debit, 462, 483Subsequent documents, 466Subservices, 51Supplier collaboration, 28Supplier Identification, 22Supplier Management, 22Supplier Self-Services, 23Supply area, 332Supply chain, 15Supply network planning, 28Supply Option section, 81Supplying plant, 269, 311, 454Surcharge, 86SUS, 23

Index

530

T

Target contract value, 164Target quantity, 166Tax code, 82, 94, 96Tax indicator, 91

for material field, 92Tax Indicator field, 46Tax percentage, 96Tax relevance

for each material, 92for vendors, 93

Tax relevant, 91Taxes, 86

in purchasing documents, 91Terms of payment, 162, 172Third-party orders, 209

master data, 212process flow, 209

Three-way match, 50, 377Time-phased planning, 110Tolerances, 484Total document (order) value, 90Total forecast, 130

results, 134Total inventory value, 441

at the corporate level, 441Tracking batches, 441Trade-off zone, 168, 177Trading goods, 41, 442Transacation

PK13N, 336Transaction, 464

MB01, 445MB03, 292, 314, 321MB1C, 446MB31, 445MB5T, 265, 279, 280, 291, 293, 313,

314, 319, 321MC21, 137MC22, 137MC23, 137MC59, 138MC61, 138MC62, 138MC63, 138MC84, 139

Transaction (Cont.)MC85, 139MC86, 139MC91, 138, 140MC92, 140MD02, 146, 147MD03, 147MD04, 150MD05, 149MD06, 149MD07, 150MD25, 122MD26, 122MD27, 122MDBT, 145MDLD, 149ME01, 73ME03, 73ME04, 74ME05, 74ME06, 74ME07, 74ME0M, 74ME11, 85ME12, 85ME13, 85ME14, 85ME15, 85ME21N, 192, 269, 275, 288, 310,

316, 393ME22N, 192ME23N, 192ME28, 192, 221ME29N, 192, 221ME2A, 391ME2O, 209ME31K, 168ME31L, 178ME32K, 168ME32L, 178ME33K, 168ME33L, 178ME35K, 221ME35L, 221ME38, 178ME41, 159, 365ME42, 159

Index

531

Transaction (Cont.)ME43, 159ME47, 159ME48, 159ME49, 159ME4S, 159ME51N, 181, 363ME52N, 181ME53N, 181ME54N, 181, 221ME55, 182ME56, 182ME57, 182ME58, 192ME59N, 192, 263, 288ME5A, 182ME61, 236ME62, 236ME63, 236ME64, 236ME65, 237ME6A, 237ME6B, 237ME6C, 237ME6D, 237ME9E, 178ME9F, 192MEK1, 98MEK2, 98MEK3, 98MEKE, 98MEKF, 98MEMASSIN, 85MEQ1, 79, 85MEQ3, 79, 85MEQ4, 79, 85MEQ6, 79MEQ7, 79MEQ8, 79MEQM, 79MIGO, 266, 280, 292, 320, 446MIGO_GR, 266, 280, 292, 320MIR4, 476MIR5, 476MIR6, 466, 475, 476MIR7, 473MIRA, 466, 473, 476

Transaction (Cont.)MIRO, 293, 322, 323, 463, 473,

476, 483MK01, 68MK02, 68, 286, 385MK03, 68MK04, 69MK05, 69MK06, 69MKH1, 70MKH2, 70ML01, 55ML02, 55ML03, 55ML81N, 372MLS6, 55MM01, 48, 120, 121, 159MM02, 48, 119, 120, 121, 128, 131,

133, 159, 350MM03, 49MMBE, 279, 280, 291, 293MMH1, 49MMN1, 49MMS1, 49MMV1, 49MP30, 131MP31, 131MP32, 131MP33, 131MP38, 131MP39, 131MP80, 130MP81, 130MP82, 130MP83, 130MPBT, 131MPDR, 131MR8M, 485, 486MR90, 476MRBP, 467MRBR, 471, 476MRDC, 482MRIS, 482MRKO, 481, 482MRNB, 482MRP, 78, 99MRP indicator, 71

Index

532

Transaction (Cont.)MRRL, 477, 482NACE, 189, 192PB00, 84PK05, 331PKMC, 332VF01, 291, 321VI01, 434VI04, 434VI11, 436VL02N, 273, 278VL06G, 273VL06I, 403VL10B, 270, 289, 312, 318VL10D, 270VL10G, 278VL31N, 400VL34, 399VL60, 407, 421, 430VL64, 399VL71, 273VT01N, 431VT04, 421VTLA, 284WLB13, 352WLB4, 352WLB6, 341WLBA, 349XK01, 67XK02, 67, 286, 385XK03, 67XK04, 68XK05, 68XK06, 68XK07, 68XK99, 68

Transaction MIGO, 446action, 448reference document, 449

Transactional data, 237Transacton

MC8V, 142, 143MC8W, 142, 143MC90, 142, 143MC93, 142, 143MC94, 143MC95, 143

Transacton (Cont.)MC96, 142MD01, 145MD20, 144MD21, 144

Transfer posting, 456Transition, 168Transmission, 168Transportation, 28

tables, 497Transportation chain, 420, 428Transportation Management, 99,

472, 479Transportation scheduling, 396Transportation services, 480Transportation shipments

costing, 432Travel time, 99Trend model, 124Trigger quantity, 335Two-step stock transport order with

outbound delivery, 275Two-step stock transport order without

outbound delivery, 262Type

define confirmation, 389Types of release strategies

with classification, 213without classification, 213

U

Underdelivery tolerance, 83Unit price, 154, 184Unlimited overdelivery, 83Unplanned services, 363Unrestricted stock, 441Unrestricted-use stock, 291

V

Valid from field, 46, 54Validity dates, 84Valuation area, 444Valuation class, 444Valuation Class field, 53Valuation price, 445

Index

533

Value contract, 160, 167Value of orders, 238Value of the contract, 166Variances

in the item, 470in the item amount, 470

Variant, 404for creation, 427

Vendor, 56, 86, 151, 250account, 466batch, 447consumption forecast, 18customer, 223data, 81, 464field, 76hierarchy, 69master, 223number, 39, 451partner role, 160purchasing, change, 386reference number, 370send reminder, 390

Vendor confirmationshipping, 395

Vendor evaluation, 226main criteria, 233overall score, 233

Vendor master, 19, 39, 58, 93, 286, 307, 462, 477acknowledgement, 387alternative purchasing data, 64change, 386Company Code Data section, 59

Vendor master (Cont.)define confirmation control, 385General Data section, 58partner functions, 62purchasing organization data, 60record, 68tables, 492

Vendor MRP area, 117Vendor order acknowledgement, 384Vendor subrange, 64

field, 81VLPOD, 314, 315Volume discount, 86

W

Warehouse, 33Warehousing, 15, 28WBS, 51Weekly buckets, 169Weekly requirements, 168Weighing factor, 235Weighted moving average, 125Weighting group, 127Weighting key, 235Winshuttle, 446Withholding Tax, 59Work breakdown structure, 369Workflow, 216Worklist, 463

X

XK02, 308


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Matt Chudy is an independent SAP Logistics consul-ting lead. He has more than 13 years of experience in Sales and Distribution, Materials Management, and other logistics applications, spanning project adminis-tration, design, gap analysis, testing, implementation, and support and training.

Luis Castedo is an independent systems and business consultant with more than 20 years of experience. For the past 15 years, he has been focused on SAP imple-mentations, spanning Sales and Distribution, Materials Management, Inventory Management, Warehouse Management, and Transportation Management.





Procurement with SAP MM: Business User Guide (SAP PRESS) | Reading Sample

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Transcript of Procurement with SAP MM: Business User Guide (SAP PRESS) | Reading Sample