Consignment Process Conginemt process is keeping the stock in customers premises, but until the constomer consumes or sell

l it, it will be a part of the company. (It is not mandatory that we should stock the consignment stock in the customers premises, we can store it in the company premises too). The consignment process in SAP standard consist of four small processes: Consignment fillup (send materials to customer consignment). Here you have a consignment fillup order and a consignment fillup delivery. Consignment issue (issue materials from customer consignment to the customer). Here you have a consignment issue order, consignment issue delivery and a consignment issue invoice. (the flow is very similar to a normal OR flow, but the materials are issued from the consignment stock instead of plant stock unrestricted). Consignment return (return materials from customer ownership to customer consignment). Here you have a consignment return order, consignment return delivery and a consignment return invoice. (the flow is very similar to a normal RE flow, but the materials are returned to the consignment stock instead of plant stock returns). Consignment pickup (pickup consignment stock and move it to plant stock). Here you have a consignment pickup order and a consignment pickup delivery. Note: In consignment fillup and consignment pickup there are no invoices since there is no change of ownership for the materials. How to perform a consignment order? In consignment orders you are allowing the stock to sit in your customer location. Once he informs that he used the stock you will invoice him. If he returns the stock you will accept the stock to take it back. It is defined in 4 steps. 1. Consignment fill up: Sales document type is KB Item category KBN shedule line category E1 In this step, you are not invoicing the customer. document flow is sales order ---- delivery item category. It will not be relevent for billing and pricing because you are not charging money for these goods in this step. In schedule line category, you will set movement type 631 & set for availability check and TOR. 2. Consignment Issue. Once the customer informed you that he used all the goods or partial goods then you will create consignment issue for used goods. Sales document: KE Item category: KEN shedule line category: C0 or C1

Here you are invoicing the customer (because he used the goods). You are assigning the delivery document and billing document to the sales document. In item category, you are setting relevent for billing, pricing, special stock. In schedule line category, your setting is 633 movement type, relevent for availability check & TOR. 3. Consignment Return: Customer found that some goods are damaged or is not able to sell the goods he would to send it back. Then we need to created the following document to accepts those goods. Sales document type: KR Item category: KRN Shedule line category: D0 Assign delivery document and billing to sales document. Create return order, return delivery, return billing. The settings of item category is relevent for billing, returns, pricing, special stock. The settings of schedule line item category:- 634 movement type, NO availability NO TOR. 4. Consignment Pick up: Even if you create the consignment return the goods are not come to direct to your plant. For that you need to create consignment pick up. here the owner ship is not changing so you do not need to create billing. Assign retrun delivery to sales document type. Sales document: KA Item category: KAN schedule line category: F0 & F1 The settings for item category relevent for returns. The settings for shedule line category :- 632 movement type, relevant for MRP, availability check and delivery. Check your plant stock. Stock will increase.

Consignment Stock Processing Purpose Consignment goods are goods which are stored at the customer location but which are owned by the company. The customer is not obliged to pay for these goods until they remove them from consignment stock. Otherwise, the customer can usually return consignment goods that are not required. Consignment Fill-Up: Consignment fill-up replenishes the stock at the customer site. Since the goods remain the property of the company, this process is not relevant for pricing and consequently not for invoicing either. Create a sales order using order type KB. Enter the required data on the customer, the consignment goods and the delivering plant. Enter all other relevant data and save the order.

Create a delivery as the subsequent document for this sales order and, after picking has been completed successfully, post goods issue. The underlying goods movement type is a stock transfer. This ensures that when goods issue is posted, consignment special stock is created for the customer concerned. If special stock of this kind already exists in the delivering plant for this customer, the goods are posted to this special stock. Order type: KB (document category C: sales order) Std. Delivery type: LF Item category: KBN (not relevant for pricing and billing) Schedule line category: E1 (relevant for deliveries, uses availability check, 631 (GI consignment: lending) to post the stock into a special consignment category in the delivering plants stock for that particular customer and material) Copy control rules for the sales doc, item category, and schedule line category. Use trans MB58 or MMBE to check the stock. In this case, Accounting document is required to be generated only for taxes, as the stock is still the ownership of the company. In the pricing procedure all condition type except for Taxes should be statistical. Consignment Issue: The Consignment issue enables the customer to withdraw consignment goods from the special stock that are to be used or sold. Create a sales order using order type KE. Enter the required data for the customer, the consignment goods and the plant to which the goods are to be returned. Enter all other relevant data and save the order. Create a delivery as the subsequent document for this sales order and, after picking has been completed successfully, post goods issue. The goods are then reduced by the relevant quantity in the special stock assigned to the customer. This goods issue also reduces your total stock. Invoice the delivery which issues the consignment goods. Order type: KE (document category C: sales order) Std. Delivery type: LF Invoice: F2 Item category: KEN (relevant for pricing and deliver related billing, special stock indicator W, should determine cost too) Schedule line category: C1 (relevant for deliveries, uses availability check, 633 (GI issue: customer consignment) In this case, Accounting document is required to be generated only for most of the condition type, as it is being invoiced to end customer. Consignment returns: proceed as follows: Consignment returns enable your customer to return goods to the consignment stock that has already been issued from it. Create a sales order using sales order type CR. Enter the required data on the customer and the consignment goods. Enter all other relevant data and save the order. Create a returns delivery for the sales order (the system automatically chooses delivery type LR). The goods issue posting cancels the goods issue posting which was carried out when the consignment goods were issued. This posting records the return of the goods to

the plant where goods receipt was carried out. Create a credit memo for the consignment return you created in Step 1. Order type: KR (document category H: returns) Delivery type: LR Credit for Returns Order type: RE (delivery or order related billing) Item category: KRN (relevant for pricing and deliver related billing, special stock indicator W Schedule line category: D0 (relevant for deliveries, no availability check, 634 In this case, Accounting document is required to be generated only for most of the condition type, as it is being returned by the customer & invoicing already done to customer.. Consignment Pick-Up: The company uses consignment pick-up to take back consignment goods that are faulty or excess materials that the customer does not need. This process is not relevant for billing since the goods remain the property of the company. It may be beneficial to have a mandatory reference such as the consignment fill-up. In addition to it copy control rules can be used to further control it. In the copy control rules indicate the document flow. As the stock is coming back into the warehouse or plant, you can specify a returns shipping point to be automatically determined. No invoice is necessary, as the goods are not changing ownership. Create a sales order using order type KA. Enter the required data for the customer, the consignment goods and the plant to which the goods are to be returned. Enter all other relevant data and save the order. Create a returns delivery for the sales order (the system automatically chooses delivery type LR). The transaction is completed by the goods issue posting which initiates a transfer posting from the customer's special stock to your plant stock. Order type: KA (document category C: sales order) Delivery type: LR No invoice Item category: KAN Schedule line category: F1 (relevant for deliveries, availability check against the stock on the customer's consignment, 632 (Consignment pickup) In this case, Accounting document is required to be generated only for taxes, as the stock is still the ownership of the company. In the pricing procedure all condition type except for Taxes should be statistical, as the stock is being returned from consignment site to plant.