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SAP-MM
Material
Management
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Table of Contents
1. Enterprise Structure……………………………………………………………
1.1. Defining Organizational Units……………………………………………………09
1.1.1. Define Company ………………………………………………………….10
1.1.2. Define Company Code…………………………………………………….11
1.1.3. Define Controlling Area…………………………………………………...12
1.1.4. Define Plant……………………………………………………………… 13
1.1.5. Valuation Area: …………………………………………………………...14
1.1.6. Define Storage Location:…………………………………………………..15
1.1.6.1.Storage Location……………………………………………………….15
1.1.7. Define Purchasing Organization…………………………………………...16
1.1.8. Purchasing organization types: ……………………………………………16
1.1.8.1.Centralized Purchasing………………………………………………...16
1.1.8.1.1. Corporate Group-wide purchasing…………………………….16
1.1.8.1.2. Company specific Purchasing ………………………………...16
1.1.8.2.Distributed Purchasing………………………………………………...16
1.1.8.3.Reference Purchase Organization: ……………………………………17
1.1.8.4.Standard Purchase Organization: ……………………………………..17
1.2. Assigning Organizational Units………………
1.2.1. Assign company code to company ……………………………………….18
1.2.2. Assign company code to controlling area…………………………………18
1.2.3. Assign plant to company code…………………………………………….18
1.2.4. Assign purchasing organization to co-code……………………………….18
1.2.5. Assign purchasing organization to plant…………………………………..18
2. Master Data-Material Master data…………………………………………………19
2.1. Sub Modules of Material Management. …………………………………………20
2.2. Master Data………………………………………………………………………20
2.3. Transaction Data…………………………………………………………………20
2.4. Material Master Data…………………………………………………………….20
2.4.1. Material……………………………………………………………………20
2.4.2. Material Master……………………………………………………………20
2.4.3. Material Type: …………………………………………………………….21
2.4.4. Material Group: …………………………………………………………...21
2.4.5. Material Class: ……………………………………………………………21
2.4.6. Material Type Controls……………………………………………………22
2.4.7. Material Types in standard SAP: …………………………………………22
2.4.8. Material Views: …………………………………………………………...23
2.4.9. Material Master IMG settings……………………………………………..24
3. Master Data: Vendor ………………………………………………………………..25
3.1. Vendor …………………………………………………………………………...26
3.2. Vendor Master: …………………………………………………………………..26
3.3. Vendor Master Record: …………………………………………………………..26
3.4. Type of Vendors: …………………………………………………………………27
3.4.1. Internal Vendors……………………………………………………………27
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3.4.2. External Vendors…………………………………………………………..27
3.4.3. Regular Vendors…………………………………………………………...27
3.4.4. Fixed Vendor………………………………………………………………27
3.4.5. One time Vendors………………………………………………………….27
3.5. Vendor Account …………………………………………………………………..27
3.6. Vendor Account Group: …………………………………………………………..27
3.7. SAP standard Vendor Groups are: ………………………………………………..27
4. Procurement Cycle……………………………………………………………………29
4.1. Document Concept in SAP………………………………………………………30
4.1.1. Purchasing Document………………………………………………………30
4.1.2. Structure of the Purchasing Document……………………………………..30
4.1.3. Types of Purchasing Documents: ………………………………………….30
4.2. Purchase Requisition……………………………………………………………. 31
4.2.1. IMG setting for Purchasing Requisition…………………………………...32
5. Request For Quotation (RFQ): ……………………………………………………...33
5.1. RFQ can be entered ……………………………………………………………….34
5.2. When RFQ required? ……………………………………………………………..34
5.3. RFQ Consists of: ……………………………………………………………….…35
5.4. IMG setting for Request for Quotation (RFQ) ……………………………………35
6. Quotation Maintenance………………………………………………………………37
7. Purchasing Info Record………………………………………………………………38
7.1. Purchase Info Record – IMG settings……………………………………………..39
8. Source List…………………………………………………………………………….40
8.1.1. Source List IMG settings…………………………………………………..41
9. Outline Agreements - contracts……………………………………………………...42
9.1.1. Types of Outline Agreements. ………………………………………….…44
9.1.1.1.Contracts. ……………………………………………………………...43
9.1.1.1.1. How it works? …………………………………………………43
9.1.1.1.2. Types of Contract: …………………………………………….44
9.1.1.1.2.1.Quantity Contract (MK) ……………………………….….44
9.1.1.1.2.2.Value Contract (WK) …………………………………..….44
9.1.1.1.2.3.Distributed Contract (DC): ……………………………..…44
9.1.1.1.3. Contract – IMG Settings…………………………………….…44
10. Out Line Agreements - Schedule Agreement (SA): ………………………………..45
10.1.1.1. Schedule Agreements (SA) – IMG settings………………………..45
11. Creation of Cost Center………………………………………………………………47
11.1. Cost Center…………………………………………………………………48
11.2. Cost Element……………………………………………………………….48
11.3. Cost center IMG settings…………………………………………………..48
11.4. Creation of Std. Hierarchy for Cost center…………………………………48
11.5. Creation of Cost center…………………………………………………….48
11.6. Creation of Cost Element………………………………………………….48
12. Purchase order………………………………………………………………………..49
12.1. IMG settings - Purchase Orders …………………………………………..50
12.2. Automatic Creation of Purchase order…………………………………….51
12.3. Tcodes in Purchasing………………………………………………………52
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18.4.9. Valuation grouping code………………………………………………….69
18.4.10. Transaction/Event Key: ………………………………………….69
18.4.11. Account modifier: ………………………………………………..69
18.4.12. Customization steps………………………………………………70
19. Inventory Management Overview………………………………………………….76
19.1. Goods movement…………………………………………………………78
19.1.1. Goods Receipt (GR) ……………………………………………………..78
19.1.2. Goods Issue (GI) …………………………………………………………78
19.1.3. Stock Transfer…………………………………………………………….78
19.1.4. Transfer Posting………………………………………………………. …78
19.2. Result of Goods movement. ……………………………………………..79
19.3. Document concept: …………………………………………………….…79
19.4. Document type in Inventory management: ………………………………80
19.5. Movement Type…………………………………………………………..80
19.5.1. Some Important Movement types: ……………………………………….81
19.6. Tcodes in Inventory Management………………………………………..82
19.7. MIGO Transaction code …………………………………………………82
19.8. Inventory Management IMG settings…………………………………….82
20. Inventory Management: Goods Receipt……………………………………………83
20.1. Steps during GR: …………………………………………………………84
20.2. Result of the goods receipts posting………………………………………86
20.3. Effects of GR on PO and Material Master. ………………………………87
21. Inventory Management: Goods Issue: …………………………………………….88
21.1. Types of Goods Issue……………………………………………………..89
21.2. Entering the good issue: ………………………………………………….89
21.3. Goods issue two ways…………………………………………………….90
21.4. Goods issues are either Planned or Unplanned…………………………..90
22. Inventory Management: Stock Transfer………………………………………….91
22.1. Types of Stock Transfer………………………………………………….92
22.1.1. Intra Company Stock Transfer……………………………………………92
22.1.2. Inter Company Stock Transfer……………………………………………92
22.2. Intra Company Stock Transfer……………………………………………92
22.2.1. Storage Location-to-Storage Location…………………………………….92
22.2.2. Plant-to-Plant……………………………………………………………...92
22.2.3. Types of Stock transfers (Str. Loc-to-Str.Loc)……………………………92
22.2.3.1. One-Step Process………………………………………………….92
22.2.3.2. Two-Step Process…………………………………………………93
22.2.3.2.1. Remove from Str. Loc…………………………………………93
22.2.3.2.2. Placing into Str. Loc. …………………………………………94
22.3. Types of Stock transfers Plant-to-Plant……………………………………94
22.3.1.1. One-Step Process………………………………………………….94
22.3.1.2. Two-Step Process (Plant-to-Plant)………………………………..95
22.3.1.2.1. Remove from Str. Loc (Plant-to-Plant) ………………………95
22.3.1.2.2. Placing into Str. Loc. (Plant-to-Plant) ………………………..96
22.4. A consolidate Statement of A/c triggered during various goods movmts.. 97
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26.6. Invoice Verification: IMG Settings………………………………………116
26.7. TAX Settings: ……………………………………………………………116
26.8. Invoice Verification ……………………………………………………...116
26.8.1. Entering of Invoice (in MIRO) …………………………………………..116
26.8.2. Parking of Invoice………………………………………………………...116
26.8.3. Holding of Invoice………………………………………………………..116
26.8.4. Releasing of Parked and hold invoices……………………………………116
27. Special Procurements: Sub-Contract Scenario: ………………………………..…117
28. Special Procurements: Stock Transport Order Scenario…………………………119
29. Special Procurements: Vendor Consignment…………………………………...…122
30. Special Procurements Third Party Scenario………………………………………125
31. Consumption Based Planning………………………………………………………128
31.1. MRP: Material Requirement Planning………………………………..…129
31.2. MPS: Master production schedules are …………………………………129
31.3. CBP: Consumption Based Planning………………………………..129
31.4. Procedures in CBP………………………………………………………..129
31.4.1. Re-order Point planning…………………………………………………..130
31.4.2. Forecast based planning………………………………………………..…130
31.4.3. Time phased planning…………………………………………………….130
31.4.4. Re-order Point planning…………………………………………………..130
31.4.4.1. Lot Size Procedure: ………………………………………………131
31.4.4.2. Static Lot Sizing Procedure………………………………………131
31.4.4.3. Periodic Lot sizing Procedure……………………………………131
31.4.4.4. Optimum lot sizing procedure……………………………………131
31.4.5. Forecast based planning………………………………………………….132
31.4.5.1. Constant Model…………………………………………………..132
31.4.5.2. Trend Model……………………………………………………...132
31.4.5.3. Seasonal Model…………………………………………………..133
31.4.5.4. Trend seasonal model……………………………………………133
31.4.6. Time phased planning……………………………………………………134
31.4.7. MRP Master Data………………………………………………………..134
31.4.8. MRP controller………………………………………………………..…134
31.4.9. MRP Group………………………………………………………………134
31.4.10. PPC calendar……………………………………………………..134
31.4.11. MRP Procedure………………………………………………..…134
31.4.12. Different Planning runs………………………………………..…134
32. Warehouse Management (WM)……………………………………………………136
32.1. Warehouse Structure Without WMS………………………………….…137
32.2. Warehouse Structure With WMS……………………………………..…137
32.3. The warehouse structure in Warehouse Management……………………138
32.4. Warehouse Number………………………………………………………138
32.5. Warehouse number uniquely identifies the warehouse in a plant………..138
32.6. Storage Type……………………………………………………………..138
32.7. Storage Section…………………………………………………………..139
32.8. Picking Area……………………………………………………………..139
32.9. Storage Bin………………………………………………………………139
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32.9.1. Creating Storage Bins…………………………………………………..139
32.9.2. Creating a single storage bin……………………………………………140
32.9.3. Creating several storage bins simultaneously…………………………..140
32.9.4. Example: Creating Several Storage Bins……………………………….140
32.9.5. Example: Creating Several Storage Bins…………………………….…140
32.9.6. Template……………………………………………………………..…141
32.9.7. Structure………………………………………………………………..141
32.9.8. Start value………………………………………………………………141
32.9.9. End value……………………………………………………………….141
32.9.10. Increment…………………………………………………….…141.
32.9.11. Quant…………………………………………………………....141
33. ASAP methodology………………………………………………………………..142
34. Important MM Tables……………………………………………………………143
35. SAP MM TCODES ………………………………………………………………147
36. Standard Reports in Material Management……………………………………153
37. Extra Topic: Blanket Purchase Orders…………………………………………155
38. Extra Topic How to attach a document to PO……………………………….…158
39. Lab Exercises: ……………………………………………………………………160
39.1. Creation of Organization Structure…………………………………….161
40. Lab Exercises: Material Master…………………………………………………..186
40.1.1. IMG settings & Creation……………………………………………….187
41. Errors List: Common Errors & Solutions…………………………………….. 200
42. SAP MM Question Bank-with Answers, and Explanations…………………...206
43. Data Uploading - TOOL: LSMW – Record Method……………………….…222
44. Release procedure for PR with classification…………………………………..232
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Enterprise Structure:
Defining Organizational Units
Assigning Organizational Units
01
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Define Company
Company:
Customization Step:
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Define Company Code
Company Code
Customization Step:
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Define Controlling Area
Controlling Area:
Customization Step:
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Define Plant
Plant
• It is an Operational Unit with in a company code.
• It is a place where materials are produced or Goods/Services are provided.
• A Plant can be having
- Manufacturing facility - Regional Sales Office
- Central Delivery warehouse - Corporate HQ - Maintenance Plant
Valuation Area:
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Valuation Area
Customization Steps:
Valuation Level
You define the valuation level by specifying the level at which material stocks are
valuated
You can valuate material stocks at the following levels:
a) Plant level
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Storage Location:
Customization Steps:
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Purchasing Organization:
1. Centralized Purchasing
a) Corporate Group-wide purchasing
b) Company specific Purchasing
2. Distributed Purchasing
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Note:
- Purchasing Organization can also exist with out assigning to a company code.
- Each Purchase organization has its own
o Info Record and Conditions for pricing.
o Own Vendor master Data.
- Vendor is assigned to only one purchase organization.
- Each Purchasing Organization evaluates its own vendors using MM Vendor Evaluation.
If a several Purchase organizations procure for a plant, you can define one of them as
standard Purchase Organization. In Source determination for ‘Stock Transport’ and
‘Consignment’ and for good issue of ‘Pipeline material’ system utilizes the standard
purchase organization automatically.
Customization Steps:
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Assigning of Organizational Units
Customization Steps:
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Master Data:
Material Master Data
02
Sub Modules of Material Management.
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A) Purchasing Module
B) Inventory Management.
C) Logistic Invoice Verification.
Master Data
The data in consolidation system that remains unchanged over a long period of time called
master data.
Transaction Data
Material
- Goods or objects that are used, consumed or created during the manufacturing
may be called materials.
- It is the smallest unit that cannot split into any smaller unit.
- Material can be traded, used in manufacture, consumed are produced.
- A Service may also be treated as material.
Material Master:
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Material Type:
Certain attributes of Material called Material Type or Grouping of materials with same
basic attributes/characteristics.
Material Group:
Similar properties of material grouped together called Material Group (Or) grouping of
materials according to their characteristics.
Material Class:
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Material Views:
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Master Data:
Vendor Master
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Vendor Master:
Vendor:
Vendor is a Business Partner fro whom the material or services can be procured
. Or
Vendor is a business partner to whom amounts are payable for goods delivered/ services
performed by him.
Vendor Master:
It contains the complete data of Vendor to whom the a company conducts business with.
The Data Record that containing all the information necessary for any contact with a certain
vendor, in particular for carrying out business transaction.
Note:
Vendor can also be called as source or creditor
Vendor will fulfill the requirement of the organization.
Since vendor is crediting business partner, accounting and purchasing departments maintain
the vendor master record
In HR each employee is treated as Vendor.
If the Quality of Vendor’s product is poor, you can block a vendor for an individual
material via source list.
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Type of Vendors:
Internal Vendors: Supplying by another company code under the same client
External Vendors: A company or a person who supplies material from out side (Indigenous and
imported vendor)
Regular Vendors: A vendor supplies the material at client level.
He supplies to entire corporate group.
Fixed Vendor: The vendor from whom company will take certain materials, which are low value
and high volume type
One time Vendors: Supply only once. (If RFQ/PO is sent to the vendor, you have to enter the
vendor data manually)
Vendor Account:
- It contains transaction figures where value movements are recorded as period totals in account
payables.
- Payables to vendors are recorded simultaneously in a general ledger account by assigning a
reconciliation account to the vendor account.
- Each vendor account is a G/L account in FI module.
It is the end node of the hierarchy, can contain any number of accounts that belongs to Chart of
Accounts. These can be
o G/L Accounts from the Financial Accounting
o Primary cost or secondary cost
o Revenue elements from controlling
Vendor Account Group determines
• The Intervals for the Account numbers.
• Whether it is a one-time account?
• Which fields are ready for input or must be filled in the material master.
• Whether the number range is assigned internally or externally
Note: An Account Group must be assigned to each Vendor master record
Procurement Cycle
Document Concept in SAP
Transactional Data:
Purchase Requisition
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PROCUREMENT CYCLE
5. PO Monitoring 4. PO processing
1. Determination of Requirements
• The material requirements are identified by the user departments or material planning &
control
• The requirement passed manually to the purchasing department
[In case if you set MRP procedure for a material in the material master R/3 system will
automatically generates a purchasing requisition]
2. Source Determination
• Identifies the potential source of supply
• This is based on a) Past Order b) existing long term purchasing requirement
3. Vendor Selection
• The selection of vendors by comparing the prices of various quotations
• Sending the rejection letters for the non-selected Vendors.
5. PO Monitoring
• Sending the reminders to Vendors in a pre defined intervals
7. Invoice Verification
• Invoices are checked for accuracy of prices and contents
• Noting of quantity and price variances based on purchase order & goods receipt data
8. Payment processing
• Find accounting for vendor payments
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Purchasing Document
• It is common for all Purchasing documents. In earlier versions (i.e. before 4.6c) below three
segments are as three screens.
• In latest versions all three screen information is in a single screen information with tabular
form called Enjoy Transaction (It ends with ‘n’ in Transaction code)
Item Details Mat. Group, Unit of measure, Vendor mat. No, vendor A/c group etc.
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Purchase Requisition (PR):
T codes Reports
Creation - ME51/n List of PRs -- ME5A
Change - ME52/n
Display - ME53/n
Process
RFQ
Manual
PR OA
MRP
PO
Master
data
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IMG setting for Purchasing Requisition
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Transactional Data:
Request For Quotation (RFQ)
Da y - 9
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Request For Quotation (RFQ):
T codes Reports
Creation - ME41 RFQ list by Mat.-- ME4M
Change - ME42 RFQ by collt No.-- ME4S
Display - ME43
Source of Supply
PO
Vendor A
PR
RFQ Vendor B Quotations
Manual
Vendor C
Rejection
letter
Material & vendor
Master data
• It is an Invitation to Vendor for providing Quotation (bid or tender) for supplying the material.
• You should have suitable vendors for the RFQ
• You should enter the dead lines for submission of Quotation
• RFQ is same as PR, but it has a collective number [It is a 10-digit code used for the system
automatically picks all the relative quotations for a particular material. It is used in Header]
• When you filling up the item details and schedule lines for the materials system determines the
address from the vendor master record
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RFQ Consists of:
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Transactional Data:
Quotation Maintenance
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Quotation:
T codes
Creation & Change - ME47
Display - ME48
Price comparison. - ME49
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Master Data:
Purchasing Info Record
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Purchasing Info Record
T codes Reports
Creation - ME11 By Material – ME1M
Change - ME12 By Vendor - ME1L
Display - ME13
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Master Data:
Source List
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Source List
T codes Reports
Creation List of Vendors
& Change - ME01 for material -- ME0M
Display - ME03
• It is also a master record and gives a list of vendors available for a particular material and
checks the validity of the vendor.
• It specifies the possible source of supply for a material over a given period of time.
• It shows the time period in which a material may be ordered from a given vendor or under
certain long-term agreement.
• Source list support the user in answering the question “ which vendor can supply a material
at a given point of time”.
Important Notes:
1. In the source list you can block a vendor for a single material or fix the vendor (make the
vendor continuously)
2. Source list requirement are set at PLANT level but not at company code level (SAP
recommends this)
3. It is also used in automatic selection of vendors for a material.
4. If a source list requirement exists, a material may not be procured from sources other than
those included in the source list. A source list requirement can be specified for an
individual material (in the material master) or for all materials of the plant (using the
customizing parameter)
5. Source list records can be created manually either directly or from with in out line
agreement or info record maintenance.
6. You can create the source list for a material by referencing another material
7. There is NO number range for source list
8. Source list is need not be maintained for one time vendor. But Vendor Master can be
maintained (flagging one time vendor)
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Transactional Data:
Outline Agreement - Contract
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Outline Agreements
• It is a long time agreement between a Purchasing Organization and a Vendor who is supplying
the material (or services) over a certain time frame on the basis of pre-defined terms and
conditions.
• It is a legal document between Vendor and Purchasing Organization
• There are two types of Outline Agreements.
1. Contracts. (It is also called release order/call off order)
2. Scheduling Agreements (SA).
1. Contracts:
T codes Reports / List of
Creation - ME31K Contracts for Material. - ME3M
Change - ME32K Contracts for Vendor. - ME3L
Display - ME33K
• It is used for mass production Industries or where material consumption is very high.
• In Contract company/Purchasing organization assures the vendor about the Quantity or Value.
• However you have to release Purchase order for every supply.
• Contracts are Outline Agreements.
• They do not contain details of delivery dates for each item.
• Contract contains control data for billing purpose, for creation of budget billing plans and for
contract accounts receivable and payables
• A contract created by one plant can be referred by purchase organization of another plant.
However the referring purchasing organization is the Standard Purchasing Organization for the
other plant.
How it works?
• To inform Vendors of which quantities you need for which date, you enter a contract release
order for contract.
• A release order is a PO that references a contract.
• If the Info Record with conditions exists for the Material and Vendor, the system automatically
the system automatically suggest the net price according to those conditions when you create the
Contract item.
• You can create a contract manually. When you do so, you can reference other contracts, purchase
requisitions, RFQs and Quotations.
• One thing you define in Contract Header is the Validity period
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Types of Contract:
The Total Quantity is assured to vendor and the supply of the material based on the Material
Contract individual release order issued against this contract. [Definition: A long-term
purchase agreement for purchasing the quantity of the goods is agreed.]
These are centrally agreed contracts that are more available to other R/3 systems for issuing
Release orders against them.
Note:
• For each item in Quantity Contract, you define the target Quantity and PO
Conditions.
o Once the Quantities are over system will display error.
o For creation of Value Contract choose the agreement type as ‘WK’
• Hence the ‘Target Value’ will appear instead of ‘Target quantity’ in the screen.
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Transactional Data:
Out-line Agreement -
Schedule Agreement
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• It is a long-term purchase agreement with a vendor for supply of materials according to the pre-
determined conditions.
• There is no Purchase Order required. So no release order for Schedule Agreement.
• Details of the Delivery dates and quantities for supply of material will be intimated to the Vendor
in the form of Schedules.
• There is no Assurance of Quantity or Value will be given to the vendor in Schedule
Agreements.
• Delivery Schedule lines can be created with or with out reference to the Purchase Requisition.
• Schedule lines can also be generated automatically using MRP system. Such delivery lines do
not constitute separate document, but from the part of the Schedule Agreement.
• Procurements using Schedule Agreements there fore help us to reduce the volume of the
document in use.
• The basic idea of Schedule Agreement is to reduce the office inventory.
Purchase Requisition
Quotation
Out line Agreement
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CONTROLLING
• Controlling provides information for management for decision-making.
• If facilitates co-ordination, monitoring and optimization of all process in an organization.
COST CENTER
• Organizational Unit within a controlling area that represents a defined location of cost
incurrence is called Cost Center
• Tcodes for Creation of Cost Center are
o Define Standard hierarchy - OKKP
o Creation of Cost Center - KS01
o Creation of Cost Element - KA01
COST ELEMENTS
• Cost Elements Describe the origin of costs.
• Cost element classifies the organization-valuated consumption of production factors within a
controlling area.
• Primary Cost Elements
o Primary cost elements are used for direct posting and must be accompanied in GL a/cs
in FI.
CUSTOMIZATION
• Creation of Std. Hierarchy for Cost center
SPRO Æ Controlling Æ General controlling Æ Organization Æ Maintain
Controlling Area
o Click Position and enter your controlling area
o Select your controlling area and click details button.
o Enter the field Cost Ctr. Std Hierarchy with some hierarchy name.
o Click save button.
Creation of Cost center
SPRO Æ Controlling Æ Cost center Accounting Æ Master data Æ Cost center Æ
Create Cost center
o Set Controlling Area to our controlling area.
o [On menu bar Æ Extras Æ Set Controlling Area]
o Enter Name, Description, Person responsible, Cost Center Category as F for
production, Std. Hierarchy, Business Area as 0001 and Currency INR and
click save button.
Creation of Cost Element
SPRO Æ Controlling Æ Cost center Accounting Æ Master data Æ Cost Elements Æ
Create Cost element
Set Controlling Area to our controlling area.[On menu bar Æ Extras Æ Set
Controlling Area]
Enter Cost Element as 400000 and valid from date and in basic data tab enter name and
description and cost element category as 1 (1 for Primary cost/cost reducing revenue)
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Transactional Data:
Purchase Order
Purchase order 12
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Purchase Order
• It is a out going document. It is an ultimate document
• It is a legal document
• A purchase order is a request to a vendor to supply certain goods or services under the
stated conditions.
• It is confirmation from company regarding Materials, Quantities and Delivery details
• You can create Purchase Order
o Manually
o With respect to PR, RFQ, Contract, another Purchase Order
o With respect to PR, RFQ, contract and other PO at a time
• You can change the price and quantities here even though we agreed for earlier at the
time of negotiations
• The Standard Document Types for Purchase Order are:
o NB – Standard PO
o FO – Frame work order (Blanket PO/Limit PO)
o DO – Dummy PO
o EC – Electronics Commerce (for SRM applications)
• Purchase Order screen is divided into three sections
o Header
This section contains information applicable to all line items contained
on the purchase order like :
Purchase org, Purchase Group, Company code Details
o Item overview
This section contains information on the materials and/or services to
be delivered or rendered.
Material No, Description, Quantity, Delivery Plant and Storage
Location etc.
o Item details
This section contains information that will be applicable to a particular
line item in the purchase order.
Material description, Material group, quantity etc.
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Note:
When you enter the purchase order data the system suggests default values. For example:
o It suggests the ordering address, as well as the terms of payment and freight (inco-
terms) from the vendor master record.
o If you have maintained a material master for a given material in the R/3 System, the
system suggests the material short text or the material group,
o if a purchasing info record already exists in the system, the system copies a price
proposal to the purchase order.
Automatic Conversion of PR to PO
Steps:
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MM60 - List
Material Master MM01 MM02 MM03 of materials
Vendor Master XK01 XK02 XK03 MKVZ
Purchase Master
i) Purchasing Info
Record ME11 ME12 ME13 ME1L ME1M
ii) Source List ME01 ME04 ME03 ME0M
iii) Quota
arrangement MEQ1 MEQ4 MEQ3 MEQM
Purchasing
Documents
Purchasing
Requisition ME51N ME52N ME53N ME54N ME5A
Request for
Quotation ME41 ME42 ME43 ME45 ME4L ME4M
Maintenance of ME49 (Price
Quotation ME47 ME48 Comparison)
Out Line
Agreement
a) Contract ME31K ME32K ME33K ME35K ME3L ME3M
b) Schedule
Agreement ME31 ME32 ME33 ME35
i) Delivery
Schedule ME38
ii) Inbound
Delivery VL31N VL32N VL33N
Purchase Order ME21N ME22N ME23N ME29N ME2L ME2M
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Customization:
A Key defining the valid reminder days and tolerance limits applicable to this material for
the purchasing department
Customization:
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Pricing Procedure
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Pricing
• This component is to store the pricing stipulations agreed with the Vendor (like
discounts, surcharges or payment of freight etc) in the system.
• You can enter these conditions in
o Quotations
o Outline Agreements (Contracts and Schedule Agreements)
o Purchase Info Records
• The system applies the conditions in determining the price in Purchase Order
Note: You can enter further conditions in the PO itself.
• There are three kinds of prices in purchasing.
o Gross price:
It is the basic price of the material w/o discounts, surcharges and taxes
Gross price = Basic Price of the Material
o Net Price:
The Gross price after considering duties & taxes into account.
Net Price = Gross Price + Duties + Taxes
o Effective price:
The net price after considering surcharge and discount
Effective price = Net price + surcharges + discounts
Condition Technique:
• The Condition Technique is used to determine the purchase price by systematic
consideration of all the relevant pricing elements
• This is the technique for formulation of rules and requirements.
• The system arrives at a suggested price by applying conditions defined by means of
Condition technique.
• The Condition Technique is how the price determined?
• The Condition Technique is used for
o Pricing for price determination
o Tax Determination
o For automatic account determination
Access Sequence access a Condition Record of a Condition Type in a Condition Table is
a Condition Technique. This is a simple logic
• Here the Condition Type is very important like PB00, PBXX and RA01 etc.
In the background every Condition Type has its own definition means the purpose of
the Condition Type like, is it for Pricing or Percentage, Quantity base, Accrual Fields
etc is to be defined to work this functions.
• Normally we use the existing ones without any risk.
• But some cases, we have to create a New Condition Types as per the organization
requirement.
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Access Condition
Access a
Sequence Record
O
Condition Technique f
Condition Condition
In a
Table Type
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4. Condition Table
• A Condition Table consists of one or more condition keys and data part.
• Data Part contains a number that references a record in another table (which contains
the condition records)
5. Calculation Schema
• The Pricing Schema means the calculations procedure of Condition Type.
• The standard Calculation schema provided by SAP for Purchasing is RM0000
In General the Pricing structure or break up provided by vendors is under the following
format
Rs. Condition Types
Gross Price 100.00 PB00
Discount on Gross Price (@5%): 5.00 RA01
------------
Gross Price after Discount 95.00
Excise duty @ 10% on GP after ED00
Discount 9.50
------------
Sub Total 104.50
Sales Tax @ 10% on sub total 10.45 ST00
Freight 20% on GP 20.00 FRA1
Packing 2% on GP 2.00 PK00
-----------
Total Price 136.95
• A framework of steps used to calculate or determine costs, prices, period end rebates
and taxes.
o Ex. RA01 - Discount % is calculated on PB00 - Gross Price.
o It means RA01 is based on PB00 like that we have to define in the Pricing
Schema
o Here PB00 has the Access Sequence - 0002. But RA01 does not have the
Access Sequence. Why because it is a dependent on PB00. But both are
Condition Types.
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IMG settings
Define Price Determination Process
Define Access Sequences
Define Condition Types
Define Calculation Schema
Define Schema Group
- Schema Groups: Vendor
- Schema Groups for Purchasing Organizations
- Assignment of Schema Group to Purchasing Organization
Define Schema Determination
- Determine Calculation Schema for Standard Purchase Orders
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Output and Printer Determination for PO
Define Condition Table for Purchase Order
Access Sequences
Define Message Type for Purchase Order
Maintain Message Determination Schema
Assign Schema to Purchase Order
Define Partner Role for Purchase Order
Messages-> Purchase Order-> MN04-> Create
Now you create PO (ME21N) and save it.
Go to ME22N and print the PO by giving output type.
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Release procedure
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Release Procedure
• This is an Electronic Document Approval i.e. 'on-line approval rather than manual
signature.
• It is an approval process for Purchasing requisition and external Purchasing
documents
• It Involves
o Checking the correctness of the data
o Giving authorization to purchase
• The approval may be based on doc. type, doc value, plant etc
• There are two types of Release Procedures:
o With Classification (Item level release and only for PR)
o With Out Classification (Header/document level release for RFQ, PO,
contract and Scheduling. Agreement)
Note:
Item level Approval is possible only in PR
For other Purchase Documents only header level is possible
1. Release Strategy:
2. Release Condition:
3. Release Group:
• Group of persons responsible for releasing the Purchasing documents with assigned
strategy.
4. Release Code/Point:
5. Release Pre-requisite:
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6. Release Indicator:
RFQ
PO CEKKO BSART - Doc. Type
Contract GNETW- Net Order Value
Scheduling Agreement
Note: The effected Release can also be cancelled, but it is possible only before the higher
person in hierarchy has not approved
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Partner Functions/Roles
- Vendor
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Partner Functions
The Vendor as Business Partner he can assume different roles in its dealings with another
enterprise. In a procurement transaction, the vendor roles are:
• Vendor (VN)
• Ordering address (OA)
• Goods supplier (GS)
• Invoicing party (PI)
Customization Settings:
2. Partner Determination
a. Partner Roles
SPRO Æ Material Management Æ Business Partner Æ Partner Determination
Æ Partner Roles Æ Define partner roles
b. Define Permissible Partner Roles per Account Group
SPRO Æ Material Management Æ Business Partner Æ Partner Determination
Æ Define Permissible Partner Roles per Account Group
c. Partner Settings in Vendor Master Record
Define Partner Schemas
SPRO Æ Material Management Æ Business Partner Æ Partner
Determination Æ Partner Settings in Vendor Master Record Æ Define
Partner Schemas
Assign Partner Schemas to Account Groups
SPRO Æ Material Management Æ Business Partner Æ Partner
Determination Æ Partner Settings in Vendor Master Record Æ Assign
Partner Schemas to Account Groups
d. Partner Settings in Purchasing Documents
Define Partner Schemas
SPRO Æ Material Management Æ Business Partner Æ Partner
Determination Æ Partner Settings in Purchasing Documents Æ Define
Partner Schemas
Assign Partner Schemas to Document Types
SPRO Æ Material Management Æ Business Partner Æ Partner
Determination Æ Partner Settings in Purchasing Documents Æ Assign
Partner Schemas to Document Types
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Valuation and Account determination
Valuation and Account Assignment: This is fully integrated with FI.
Valuation Structure
1. Valuation Area:
a. Valuation areas are possible at
i. Company code level
ii. Plant level
Note: SAP Recommends Valuation at Plant level
2. Valuation class: Grouping of similar properties of materials for the purpose of automatic
accounts determination.
a. If you don’t give valuation class to material it will be posted to a consumption
account
3. Valuation category:
a. If you want to valuate the materials differently based on certain criterion you can
use the valuation category.
b. For example based on origin, procurement, based on status (new, rework, repaired
material). You can maintain tender wise also
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Customization:
1. SPRO Æ Material Management Æ Valuation and Account Assignment Æ Define Price
Control for Material Types
2. SPRO Æ Material Management Æ Valuation and Account Assignment Æ Account
Determination Æ Account Determination Without Wizard
a. Define Valuation Control (OMWM)
b. Group Together Valuation Areas
c. Define Valuation Classes
d. Define Account Grouping for Movement Types (OMWN)
e. Configure Automatic Postings
• Choosing the valuation level is one of the first steps we will perform while
customizing the system.
• If using the PP Production module, the valuation area must be set at the plant level.
• For account determination, you can group together valuation areas by activating the
valuation grouping code. This makes the configuration of automatic postings much
easier.
• Valuation areas are grouped together with the objective of simplifying management
of the standard accounts table by minimizing the number of entries.
• Along with other factors, the valuation grouping code determines the G/L Accounts,
to which a goods movement is posted (Automatic Account Determination).
• The valuation grouping code makes it easier to set the automatic account
determination.
• Within the chart of accounts, we assigned the same valuation grouping code to the
valuation areas.
• Since we want to assign to the same G/L account, we assigned the same valuation
grouping code to the valuation areas.
• Valuation Area Company Code Chart Of Accounts Valuation Group Code
TPL1 TMOT INT 0001
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Grouping of Valuation Areas
Valuation
Company Code Valuation Area Grouping Code/
Valuation
Modification
Valuation Area
Plant
• The Valuation class is a group of material with the same G/L account.
• When you create a material master record, you must assign the material to a valuation
class. The valuation class is assigned to a material at plant level. However, if using
split valuation, the valuation class will be assigned at the valuation type level.
• The choices for valuation class are dependent on the material type. In general, several
valuation classes can be allowed for one material type. Also, the same valuation class
could be allowed for different material types.
• The link between the valuation class and the material type is the account category
reference. The account category reference is assigned to a material type.
• The G/L account determined for a material is carried out according to the settings for
its valuation class.
Step1:
• Account Category Reference
Account Category Reference (4 Char): Group of valuation classes that’s the system
uses to check whether the valuation class you have entered is allowed when you
maintain accounting data in a material master record.
Step2:
• Valuation Class
Here The Valuation Class is defined and a Account Category Reference is attached to
a Valuation Class.
Example: 3000 (Raw Materials) -> 0001 (Reference for Raw Materials)
Step3:
• Material Type / Account Category Reference
Here the Material Type can be assigned to a Account Category Reference.
Example: ROH (Raw Materials) -> 0001 (Reference For Raw Materials)
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Material Type
Account Category
Reference
Valuation Class
Transaction key
Movement type FR1
Transaction Key
WRX Cr
GR/IR
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The following diagram shows the relation between Chart of account, Transaction, account
modifiers, accounts posting keys.
Material Plant
Master
Type of
Material
Type Company
Movement type Qty C d
Account
Categ.
Reference
Value
string
Val.
Account Grouping
Valuation
modification Chart of
Class
Account
Processing
Key
G/L
Account
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TRANSACTION / EVENT KEYS IN SAP
(WITH NOTES ON APPLICABILITY)
AUM Stock transfers are there between plants and from one movement type to another with
split valuation. The difference between the price at the delivering plant and the
receiving point is booked at the later.
Account to be opened:
Loss – Stock Transfer
Gain – Stock Transfer A/c
BO1 Check up Subsequent settlement of Provisions (e.g.: volume based rebate)
BO2 Check up. Subsequent settlement of revenues -conditions in inv. Verification
BO3 Check up Provision Differences
BSV The Company sends materials for subcontract work, this transaction is considered.
Accounts to be opened
Materials Consumed/Trading Goods w/o cost element -- for ROH
Inventory Change – Cost of Goods sold w/o Cost element -- for FERT s
BSX All stock postings to Stock Accounts due to Goods receipts & goods issues in
Inventory Management. B/s Inventory A/c s 11101 to 11111
DIF Small Differences that may arise during invoice verification in the invoice amount not
exceeding tolerance.
Accounts to be opened:
Loss—Inventory Differences A/c
Gain---Inventory Differences A/c
FRx These are used for posting delivery costs when goods and invoices are received for
purchase orders
FR1 Freight Clearing 69002 Separate A/c s is required
FR2 Provisions for freight Charges 69002
FR3 Customs Clearing 69002
FR4 Provisions for Customs Clearing
FRL Services are performed for the company externally.
Account to be opened:
Purchased Services A/c
FRN Services are performed for the company externally and hence delivery costs
Account to be opened:
External Procurement Costs A/c
GBB Offsetting Entries for Inventory Postings
AUA For Order settlement
68005 (Factory output for Production)
AUF For GRs for orders (w/o account assignment)
68005
BSA For initial entry of stock balances
11199
INV Expenditure/Income from Inventory differences
68004 – Raw Material Consumption A/c
VAX For goods issues for sales orders with no assignment object
The account will not be cost element
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68002 –Raw Material Indigenous
72001 – Stores & Spares
VAY For goods issues for sales orders with assignment object
The account is a cost element
VBO Consumption from stock provided to vendor
68002 –Raw Material Indigenous
VBR For internal goods issues (e.g.: to a cost center)
68005—Factory output for Production
72001 – Stores & Spares
VKA For consumption in Sales Order without SD (Mvt. Type 231)
68005—Factory output for Production
VNG For Scrapping & destruction
68004 – Raw Material Consumption – Others
VQY For sampling with account assignment
ZOB For goods issues with no Purchase order reference (Mvt 501)
ZOF For goods issues with no production order reference (Mvt 521)
KBS Account - assigned Purchase Order ie. account assignment taken from PO
Account need not be assigned in OBYC
KDR Exchange rate rounding differences in case of foreign currency invoices
80029 -- Exchange Rate Difference - Valuation 1
KDM Exchange rate rounding differences for open items (invoice posting with a
Different exch. rate than the GR/due to Std price difference/insufficient stock
coverage)
80028 --Exchange Rate Difference - foreign currency to local
KDV Material ledger from low levels E/R diff.
KON Consignment payables
KTR Offsetting entry for price differences in cost object hierarchies
68005—Factory output for Production
LKW Accruals and deference. acct (material ledger)
PRD Price Differences
Loss/Gain Inventory Differences (Two A/cs to be opened & assigned)
68004 – Raw Material Consumption – Others A/c is assigned
PRK Price Differences in cost object hierarchies
Loss/Gain Inventory Differences (Two A/cs to be opened & assigned)
RKA Inv. reductions from logistic invoice verification
UMB Gain/loss from revaluation Check up- 68004 is found attached (Raw Material
Consumption – Others A/c )
UPF Unplanned delivery costs
VST Input Tax
WGI Goods issue inflation revaluation
WGR Goods receipt inflation revaluation
WRX GR/IR clearing account
40051 – GR/IR Clearing A/c
WRY GR/IR clearing acct (mat. ledger) (old)
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Inventory Management:
- Overview
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o In PP
IM is responsible for staging of the components required for
production orders
The receipt of finished products in the wear house is posted
[Here, when material issued to production, IM will check the availability of
the stock and release the material for production]
o In SD
Issue the stock for Sales Order
It is possible to create Sales order stock
o In QM
In case of goods movement, the system determines whether the
material is subject to an inspection operation. If so the corresponding
activity is initiated for the movement in QM
o In FI/CO
Issue to production - Consumption A/c
Scrap - Scrap A/c
Issue to Sale - Sales A/c
Before Invoice – FI
After invoice --CO
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Goods movement
It is a goods movement, with which the receipt of the goods from vendor or
production is posted. A good receipt leads to an increase in warehouse stock
Stock Transfer
Transfer Posting
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Document concept:
• The account principle of ‘No posting with out document” is applies even IT based
Inventory management system
• A document is a proof that a transaction involving stock changes has taken place
• When a good movement is posted, a Material Document is generated as a proof of
the movement.
• If the movement is relevant to the financial accounting (i.e. if it is leads to an
update of G/L accounts) an accounting document will be generated parallel to the
material document.
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WA – Goods Issue
WE – Gross Goods Receipt
WN – Net Goods Receipt
WI – Physical Inventory Document
WL - Transfer posting
Movement Type
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Some Important Movement types:
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Tcodes in Inventory Management
1. Material documents
a. MB51 – List of Material documents
b. MR51 – List of Accounting documents
2. Stock
MMBE – Stock Overview MB52 -- Warehouse Stock
MB53 – Plant Stock Availability MB5B – Stock between Posting Dates
MB5T – Stock in Transit MBLB – Stock with Subcontract Vendor
ME2o -- Stock provided to the vendor MB50 -- Total Stock all materials
MB5S -- List of GR/IR balances
6. Layouts:
a. ME9F -- PO Printout
b. MB90 -- Output from Goods Movements
c. ME9A -- RFQ Printout
d. ME9E -- Schedule Agreement Printout
7. Reports:
a. ME80FN – General Analysis PO Report
b. MC48 -- Current Inventory
c. MC45 -- Consumption Value
• Goods Receipt
• To display of material document
• Goods Issue
• Releasing of GR Blocked stock
• Place in storage
• Removal from storage
• Cancellation of material document
Inventory Management:
- Goods Receipt
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Goods Receipt
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The diagram shows an overview of all the key effects of a goods receipt referencing a
purchase order.
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12. Other Updates:
a. Depending on the characteristics of the material, movement and components
used other updates are carried out like:
i. Entries will be made in the planning file or independent requirements
reduction in mat. Plg
ii. Statistical data in Inventory controlling
iii. Vendor evaluation data in purchasing
iv. Transfer requirements and quota in WM
v. Inspection lots in QM
Before GR After GR
In PO
o Header data - Header Data
Status View - Status view
• Order Qty - X Order Qty - X
• Delivery. Qty - 0 Deli. Qty - Y
• Still to be del - X Still 2 be del X - Y
o Item Over View - Item Over view
No New tab called PO history A new tab PO History create
o Delivery Tab
Del. Completed indicator Del completed indicator
• (No check/masked) (If full PO Qty receives)
In Material master
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Inventory Management:
- Goods Issue
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Goods Issue:
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Goods Issue
Goods issues can be planned or unplanned. The data to be entered depends on the
type of goods issue. The R/3 System prepares various account assignment fields,
depending on the movement type and system configuration. It uses automatic account
determination to determine the G/L account to which the movement is posted. You
enter a G/L account only if you want to post the goods movement to another account.
If a material is no longer of use, it is posted for scrapping. If a material is destroyed,
this information must also be entered in the R/3 System. You can scrap material from
unrestricted-use stock, stock in quality inspection, and blocked stock. When you post
a material for scrapping, the R/3 System reduces the relevant stock, transfers the
value of the scrapped material from the stock account to a scrap account, and debits
the cost center entered.
Sample withdrawal is a goods issue generally linked to a quality inspection. The SAP
sampling procedure assures you that the sample for testing is taken from the existing
stock. The sampled goods are treated as destroyed – in other words, the system
assumes that the material can no longer be used after the quality inspection. In this
way, sampling is the same as scrapping, with the exception that the value of the
sampled material is posted from the material stock account to the quality inspection
expense account.
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Inventory Management:
- Stock Transfer
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Stock Transfer:
In a day-to-day activities Stock transfer is one activity.
Normally stocks are transferred between organizational units based on official
communication of the concerned in charges.
a) One-Step Process
• Here certain quantity of material will be requested officially by the in-charge of
one storage location to the other storage location
• The following Drawing shows based on the request of Storage Loc. In-charge of
S2, S1 in-charge is sending the material under One-Step Process
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Steps:
• Use TCode: MB1B and Mvt = 311
• Enter Supplying Plant SPL1 and Supplying Storage. Location S1 in the initial
screen.
• Enter the material no and quantity
• Press save
b) Two-Step Process
[This process is adopted in SAP because when transferring the stock from one
storage location to another storage location there is a possibility of not receiving the
quantity by receiving storage location because of different events like accident, theft
may occur.
In single step whether the receiving storage location receives physically the quantity
or not it updates in stock status.
This can be avoided in the two-step process]
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2. Plant-to-Plant
Again these types of Stock transfers are two types
3. One-Step Process
4. Two-Step Process
a) One-Step Process
• Here certain quantity of material will be requested officially by the in-charge of
one storage location of one plant to the other storage location of other plant.
• The following Drawing shows based on request of in-charge of Storage Loc. of
S1 of Plant-1, sending to the material to the in-charge of S3 of Plant-2, under
One-Step Process
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Steps:
• Use TCode: MB1B and Mvt = 301
• Enter Supplying Plant SPL1 and Supplying Storage Location S1 in the initial
screen.
• Enter Receiving Storage Loc2
• Enter the material no and quantity
• Press save
Steps:
• Use TCode: MB1B and Mvt = 303
• Enter Supplying Plant SPL1 and Supplying Storage. Location S1 in the initial
screen.
• Enter Receiving Plant SPL2. Entering of Receiving Str. Loc is optional.
• Enter the material no and quantity
• Press save
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A consolidate Statement of Accounts triggered during various goods movements
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Inventory Management:
Transfer Posting
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Stock Types:
• In Inventory Management, there are three stock types that indicate a material’s
usability. If batch status management is active, the system supports another stock
type; restricted-use stock.
• Unrestricted-use stock:
• A company’s own stock that is physically located in the warehouse, is valuated, and
is not subject to any restrictions on usage.
• Quality inspection stock:
• A company’s own stock that is in quality inspection. Quality inspection stock is
valuated, but is not for unrestricted use. (not available for MRP, no with drawl is
possible)
• Blocked stock:
• A company’s own stock that is not to be used. It is not for unrestricted use in
Inventory Management and may be configured as not available for Materials
Planning. (i.e available from MRP perspective, no with drawl is possible)
• You can only post with drawls from consumption from unrestricted stock
• From Quality Inspection/Blocked Stock you can with draw only sample or scrap
material.
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Transfer Postings:
• You can only post withdrawals for consumption from unrestricted-use stock. From
quality inspection stock and blocked stock, you can only withdraw a sample, scrap a
quantity, or post an inventory difference.
• If you want to withdraw goods from blocked stock or quality inspection stock, you
have to carry out a transfer posting into unrestricted-use stock first. This also applies
to stock transfers.
• When you carry out a transfer posting, the stock type, batch number, or material
number is changed. A transfer posting may also involve an actual physical stock
transfer.
• The system creates a material document so that the transaction can be entered. The
system only creates accounting documents if a change in valuation is involved (for
example, stock transfer from plant to plant).
• You use the movement type to control the stock types involved in the transfer.
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Inventory Management:
Physical Inventory
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Physical Inventory
What is Physical Inventory?
[If no storage location segment exists for a material, this means that no goods
movement has ever taken place for the material in the storage location. The material
therefore has never had any stock at the storage location and does not exist at stock
management level. It is therefore not possible to carryout a physical inventory for the
material in this storage location
This is not to be confused with a material for which a goods movement has taken place
and for which the stock balance is currently zero. A Physical inventory must be carried
out in this case. It is also possible to carry out a physical inventory since storage
location data is not deleted when the stock balance is zero]
• Periodic Inventory
• Continuous inventory
• Cycle counting
• Inventory sampling
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Periodic Inventory:
• In periodic Inventory all stocks of the company are physically counted on the
balance sheet key date.
• Every material must be counted
• During counting, the warehouse must be blocked for material movements.
Continuous Inventory:
• With the continuous Inventory procedure, stocks are counted continuous during
the entire fiscal year.
• In this case, it is important to ensure that every material is physically counted at
least once during the year.
Cycle Counting:
Inventory Sampling:
Independent of the Physical inventory procedure, the physical inventory process can be
divided into three phases:
- Physical Inventory Preparation
o This includes creating a physical inventory document
o Blocking the material for posting and printing.
o Distributing the physical inventory document
- Physical Inventory count
o The stocks in the warehouse are counted and the count results are
entered in the count list.
o These are then transferred from the count list to the system in the step
“Enter Physical inventory count”
- Physical Inventory check
o Using the list of inventory differences, you can check variances in the
stocks.
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o You should check whether the transferred count result is correct
(change count) or whether you want to initiate a recount.
o If the difference is accepted, it is posted and stock is corrected.
Create Physical
Inventory document
Set Blocking
Indicator
Print Physical
Inventory Document
Physical Inventory
count
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Inventory Management:
Reservation
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Reservation
What is Reservation?
A Reservation is a request to the warehouse to keep materials ready for a goods issue at a
later date (for future use) and for certain purpose.
In a reservation information is stored that is relevant for goods issue and for MRP. For
example
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A Reservation document consists of a header and at least one item
• The header contains general data about the reservation (creator, movement type,
account assignment).
• The Item describe individual planned movements (material, quantity, requirement
date)
• Note: You can create a reservation for exactly one purpose only. i.e. you can enter
only one movement type and one account assignment object (like cost center)
Reservation level:
Manual/Automatic reservations:
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• A reservation document, which serves as a proof of the request is created.
• In the material master record, total stock and un-restricted use stock of the
material remain unchanged.
• Reserved stock is increased by the reserved quantity
• In MRP, available stock is reduced by the reserved quantity. This is visible in the
current stock/requirement list. The reservation causes an entry to be made in the
requirements planning file.
Note: You cannot maintain automatic reservations directly. For example, it is not
possible to change reservations for order directly. You have to change the components in
the order. The system then updates the reservation automatically.
- You can change the field selection depending on the movement type.
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- You can define per plant whether the R/3 system is allowed to create stock segment for
reservations in a particular storage location automatically.
Perform
Days allowed for Settings for Availability check
movement Reservation
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Logistic Invoice Verification: Over View
• Logistics Invoice Verification is a part of Materials Management (MM).
• It is end of the logistics supply chain
• It verifies Incoming Invoices in terms of their
– Content, prices and arithmetic and invoice is posted.
– When you post LIV certain G/L accounts are updated in FI & controlling for
their further actions. This is the integration of FI & CO
• Up to 4.6B versions – there is CIV (Conventional Invoice Verification)
• From 4.6C onwards CIV is dropped and LIV is adopted.
LIV – With this you can verify the invoices, which are generated from procurement. You
can also process the invoices which are not generated from invoices i.e. other expenses
i.e. inspection costs, travel costs etc.
• Invoice verification: Vendor invoices are checked for accuracy of prices and contents.
• Payment processing: Financial Accounting normally deals with vendor payments.
c. Invoicing plan
i. No need to wait for invoice from the vendor every time.
ii. Instead you can create invoices based on the dates scheduled in the PO
and these trigger the payment to the vendor
d. Revaluation
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5. Invoices Received via EDI:
a. Invoices are sent by vendor through EDI are verified by our SAP system and
is posted automatically.
b. If there are any differences or error occurs, they are settled manually.
c. You can also send PO through EDI.
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• The general Format of an invoice
• Important Notes
• Logistics Invoice Verification creates a separate accounting document in addition to
the invoice verification document. This is used in Financial Accounting to settle the
invoice, but can also be processed by distributed systems or external systems In
Invoice Verification; you enter all the relevant data for the vendor invoice (for
example gross amount, tax, invoice date, and so on).
• The system checks this data in subsequent processing steps and compares it with data
that already exists in the system, such as the purchase order document and the goods
receipt document.
• When you enter an invoice with reference to a purchase order
– The system suggests data from the purchase order and the goods receipts for
the purchase order (for example, vendor, material, quantity still to be
invoiced, terms of payment, and so on).
– If there are discrepancies between the purchase order or goods receipt and the
invoice, the system warns the user, and depending on how the system is
configured, blocks the invoice for payment
– You can also assign the invoice items to a purchase order using the number of
the delivery note or bill of lading, provided that these numbers were entered at
goods receipt.
– The posting of the invoice completes the invoice verification process. The
system updates the purchase order history and Financial Accounting initiates
payment for the open invoice items
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Important A/c info in Invoice verification
– When you post the invoice, the system selects the accounts to be posted
– Account assignment is based partly on
• Your entries when you create on-line
• On information stored in the system
1. Vendor a/c
2. Stock a/c
a. The system only posts to the stock a/c when price difference occurs for an
invoice
3. GR/IR clearing a/c
a. At GR
i. Net invoice amount expected is posted to stock a/c
ii. The off set entry is posted to GR/IR clearing a/c
b. At IR
i. GR/IR clearing a/c offset entry will be cleared
ii. Offset entry on the vendor a/c
4. Tax A/c
5. Price difference a/c
a. When price difference occurs, system post into this a/c and no posting to stock
a/c
6. Cash Discount clearing a/c
a. When you post a net invoice value,
i. Cash discount is taken into a/c in the invoice,
ii. it reduce the value of the items
iii. The offset postings is made in cash discount clearing a/c which is then
cleared when payment is made
7. Freight clearing a/c
– The stock account is debited with planned delivery cost at GR
– Offset posting to freight clearing account
– This is cleared by an offsetting entry to vendor a/c at invoice receipt
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Logistic Invoice Verification Module - Tcodes
1) Document Entry
a) Enter Invoice MIRO
b) Parking Invoice MIR7
c) Enter invoice for IV for background MIRA
3) Automatic Settlement
a) ERS MRRL
b) Consignment & Pipeline MRKO
c) Invoice Plan Settlement MR1S
d) RE Evaluation MRNB
Additional Notes on
You need not wait for invoice or you are not going to receive the invoice from the vendor.
Based on the information available in the system & in the PO invoices are posted.
1. In the Vendor master purchasing view you have to flag the ERS settlement and you
have to use the tax code (sales tax) in purchase order itself (in invoice tab)
a. Sales tax Æ Sales tax on sales or sales tax on purchasing (we have to pay to
vendor)
2. Subsequent settlement
a. When you are using vendor consignment & pipeline materials.
b. Based on issue of material from consignment a liability will be created.
c. For posted with drawn you have make payments periodically to vendor.
d. Here you don’t get any invoice from vendor.
e. There is no PO. There is no GR issue.
3. Invoice Plan: are used for blanket PO or Network PO (for projects). For organization
you have ordered stationary through PO. You specify the invoice dates in PO. Based
on the invoices receive in the PO you can settle payments to the vendor
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Invoice Verification: IMG Settings
• Maintain Number assignment for accounting docs
• Configure how unplanned delivery costs are posted
• Configure Vendor specific Tolerance
• Set check for duplicate invoices
• Tax settings
o Check Calculation procedure
o Assign country to calculation procedure
o Check and change the settings for calculation procedure
o Define tax codes for sale & purchases
TAX Settings:
1. SPROÆ Financial Accounting Æ Financial Accounting Global Settings Æ Tax on
Sales/Purchases Æ Basic Settings Æ Check Calculation Procedure
2. SPROÆ Financial Accounting Æ Financial Accounting Global Settings Æ Tax on
Sales/Purchases Æ Basic Settings Æ Assign Country to Calculation Procedure
3. SPROÆ Financial Accounting Æ Financial Accounting Global Settings Æ Tax on
Sales/Purchases Æ Calculation Æ Define Tax Codes for Sales and Purchases
Invoice Verification
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Special Procurements:
- Sub Contract Scenario
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Special Procurements:
SUB-CONTRACTING SCENARIO:
1. Create Materials with type ROH (Raw Material), HALB (Semi-finished), ERSA
(Spare Parts), which are procured Externally. Components – 2 nos. Main Assembly 1
no.
2. Maintain BOM with components by using Transaction code CS01. Any waste or
scrap generated or received can be maintained as component with negative quantity.
3. Maintain Initial stock of components in the plant, which you are going to send to
vendor for subcontract.
4. Create a Purchase Info Record with info category as ‘Subcontracting’ for material and
vendor.
5. Create a Subcontracting Purchase Order (with Item category ‘Subcontracting’ i.e. ‘L’)
and see that BOM explodes. Other wise enter components manually.
6. Make a Transfer Posting to issue components for Subcontract Purchase Order so that
material is sent to the Subcontracting Vendor. Here the Quantity is shown as
‘Material provided to Vendor’ if you look at the stock of that components in MMBE
transaction code. (Maintain in ME20)
7. Make Goods Receipt (Transaction code – MIGO_GR) for the finished material or
Main Assembly against Subcontract Purchase Order. Here the moment type 543 will
be triggered automatically for the components consumed by vendor and moment type
545 will also be triggered in case of is there any Bi-products from the vendor.
8. So totally three (3) accounting documents will be generated.
a. For finished goods received in to stock.
b. For subcontracting/service charges/making charges payable to SC Vendor.
c. Components consumed – Materials provided to Vendor.
9. Do invoice Verification for the Subcontracting Purchase Order and the process will
be completed. Now to get Bi-Product in to our Plant stocks do movement type 542.
10. Six (6) Accounting Documents will be triggered for subcontracting materials.
PK Account Description
1. 89 79000 Unfinished Product
2. 96 191100 GR/IR Account
3. 91 893010 Cost of Goods Sold
4. 86 417001 Purchased Services
5. 99 300000 Inventory Raw Material
6. 81 400020 Raw Material Consumed
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Special Procurements:
- Stock Transport Order
Scenario
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Special Procurements:
Stock Transport Order Scenario
• You are Purchasing the Material internally by transforming the goods movement type
[UB] and Item category [U]
• There are two type of Stock Transport Orders
A) Inter Company Stock Transport Order (Between Companies)
B) Intra Company Stock Transport Order (With In the Company)
Pre Requisites:
1. Material should exist in both plants and it should have sales view.
[or Create material with sales data and extend to both Supplying and Receiving plants]
2. Material Type should be Semi Finished (HALB) or Finished (FERT) product or Trading
goods(HAWA)
3. Both company codes should have Common Division.
Note: There can be a price difference of the material in the both plants.
There will be a cross company billing.
Settings :
Supplying Plant (PL1) Receiving Plant (PL2)
1. Create customer (XD01) with a/c group Create Supplying plant (PL1) as Vendor (XK01)
Ship-to-Party (0002) and Receiving Plant (PL2) With Account Group 0007- in Purchasing view-->
As customer Go to extras --> enter supplying plant
SPRO--> MM --> Purchasing -->PO --> Setup STO SPRO--> MM --> Purchasing -->PO --> Setup
STO
Define Shipping Data for Plants --> Define Shipping Data for Plants -->
Customer No Plant -----No customer Number Customer No Plant -----PL1
Sales org -- Supply Plant S Org Sales org -- Receiving Plant S Org
Distr. chan -- Supply Plant Dist Chan Distr. chan -- Receiving Plant Dist Chan.
Int comp.bill Div - Important <---(both should have the same div.)--> Int comp.bill Division - Important
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Ways of doing STO: Pur. Doc Item Movement Type at Shipping Billing
Type category Supply Receiving
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Special Procurements:
- Vendor Consignment
Scenario
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Vendor Consignment
Consignment is functionality in MM purchasing, when you purchase the material
from vendor on consignment basis.
We will provide the premises to vendor in our stores; however we are not responsible
for the stock.
The stock is legally owned by the vendor only
When the delivery comes, we will make a GR even then, stock still legally by the
vendor. If you look at our stock status, it shows as ‘Vendor Consignment’ stock.
As and when we want the material, whatever the quantity it is we will simply transfer
the vendor consignment stock in to our company own stock.
Vendor need not send the invoice or bill for with drawl quantity. Company will settle
his consignment liabilities
IMG Settings:
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3. Maintain Message settings and communication method for you vendor
SPRO Æ Logistic Invoice Verification Æ Message Determination Æ Maintain
Conditions Æ Change Conditions Æ Output Type : KONS and key combination
is: company code and vendor.
Steps in Consignment:
Note: First Select Display radio button and execute it. It is success full then select the
radio button to settle and execute it again.
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Special Procurement:
Third Party Scenario
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1. Our Company sales department receives a PO from our customer for a material
2. Then company sends a PO with a delivery address as Customer to supply this
material
3. Vendor will supply this material directly to the customer
4. Vendor will send an invoice to the company
5. Vendor bill will be settled after the company got the payment from customer
A) With SD Involvement:
1. Normally Sales people will take the PO from the customers & they create a Sales
Order (VA01) with 3rd party Item cat 'TAS'
2. In the back ground automatically Purchase Requisition (PR) will be created with Item
category 'S' along with Delivery address.
3. Purchase Dept creates the PO with Item cat 'S' and a/c assignment cat '1'. here
customer adds will be copied from the PR.
4. Then this PO will be sent to the Vendor.
5. Based on the PO line items vendor will supply material directly to the customer and
invoice to our Purchase organization.
6. Based on the conditions provided in the PO
a. If it is PO based invoice verification you can create a bill (Bill to the
Customer) with out waiting for Vendor IV.
b. If it is GR based invoice Verification we must very the vendor invoice before
creating a bill to customer
B) W/o SD Involvement:
[Note: If you are not always allowing third party order processing then you can create
a material master record with item category group as ‘NORM’ and procurement
should be marked as ‘X’ meaning both types of procurement (in-house manufacturing
and external product) ]
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Consumption Based Planning
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1. Re-order Point planning
When stock level falls below the ROP, system suggest for procurement
RLT = Purchase process time + Planned time + Gr processing Time
Based on the past consumption data you can define ROP and safety stock
During the period of RLT excess consumption or excess demand is met by the
SAFETY stock
Note:
When using the CBP your Inventory management should be current and
active.
Your consumption pattern must be constant or consistent
For CBP
i. Maintain MRP1, MRP2 and forecast views
ii. Define ROP and safety stock in Material master data
At ROP procurement triggers
Procurement Quantities are in LOTs
Quantity triggered for procurement is net requirement
Generally Maximum stock is not defined only ROP is defined
When net requirements are triggered those are converted into lots
For this Lot sizing procedures are defined
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1. Static Lot Sizing Procedure:
Again these are 4 procedures
a) Fixed LOT : In MRP you have to mention the LOT size
b) LOT for LOT : Based on Order Quantity LOT size is created
c) Replenishment to maximum stock level: this is only one lot you have
to define the maximum stock level
d) Fixed LOT with splitting and over lapping: you can allow the splitting
and the over lapping of LOTs
2. Periodic Lot sizing Procedure
Here you can have
o Daily – Daily requirements per a day form a LOT
o Weekly – all requirements generates over a period
o Monthly - all requirements generates over a period
o Periods of flexible length equal to posting periods
o Freely definable periods as per planning calendar
o All lot sizes are allowed for splitting and over lapping
Based on the period all requirements generated over a period
3. Optimum lot sizing procedure
a) Part period balancing
b) Least Unit Cost method
c) Dynamic Lot creation
d) Groff Reorder point planning
[Costs: Storage Costs (For storing the inventory)
Setup costs: Procurement Cost]
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d) Groff Reorder point planning
a. You are expecting a saving.
b. The formula is
Constant Model
Trend Model
Some times you can see an increasing trend of consumption over a
period of time due to the increase in the business.
This is called Trend Model
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Seasonal Model
Consumptions are high only for a particular period
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3. Time phased planning
This is used very rarely used
May be used in advance countries
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Warehouse Management
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Warehouse Structure Without WMS
If you are not using the Warehouse Management System, the storage location is the lowest
level of inventory management in the system.
In the Inventory Management (IM) component, the storage location is defined as the location
of physical stock in a plant.
When you implement the Warehouse Management System (WMS) in a plant, you define the
Individual warehouses as storage types within a warehouse complex and group them together
under a warehouse number.
As a rule, it is not necessary to define several storage locations for a plant since you assign
the WMS warehouse number to a storage location from Inventory Management (IM).
You can also manage stock for several plants in the same warehouse at the same time. In this
case, the same warehouse number is assigned to the storage locations for these plants.
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Warehouse Number
Warehouse number uniquely identifies the warehouse in a plant
Storage Type
A storage type is a storage area, warehouse facility, or a warehouse zone that you define in
Warehouse Management (WM) for a warehouse number.
This is a physical or logical subdivision of a warehouse complex.
--> Bulk storage
--> Open Storage
--> High rack storage
--> Picking area
--> Shelf storage
You can also define storage types in WM that are shared by both the Inventory Management
(IM) and Warehouse Management (WM) application components.
These are called interim storage areas
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Storage Section
A storage section is an organizational subdivision of a storage type that groups together
storage bins with similar features for the purpose of putting away stock. The criteria for
grouping bins can be defined on a user-individual basis, for example, heavy parts, bulky
materials, fast-moving items, slow-moving items.
Picking Area
A picking area is a section within a storage type in which all picking activities are carried out
in the same way.
The picking area group’s storage bins together from the viewpoint of picking strategies and is
a counterpart to the storage section, which group’s bins from the viewpoint of put away
strategies.
Storage Bin
A storage type generally contains several storage spaces or slots.
These are called storage bins in Warehouse Management (WM).
The storage bin is the smallest available unit of space in a warehouse.
The storage bin therefore describes the position in the warehouse where the goods are or can
be stored.
Since the address of a storage bin is frequently derived from a coordinate system, a storage
bin is often referred to as a coordinate.
The coordinate 01-02-03 for example, can refer to a storage bin in row 1, stack 2, and level 3.
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Creating a single storage bin
1. From the SAP Menu, choose Logistics --> Logistics Execution --> Master Data -->
Warehouse --> Storage Bin --> Create -->-->Manually.
2. Enter data as required.
As a minimum, you must enter the storage section for the storage bin.
3. Save your entries.
Creating several storage bins simultaneously
To create a group of storage bins with similar characteristics, you define a template with the
coordinate structure as follows:
1. To display a list of all previously defined templates, from the SAP menu choose Logistics
--> Logistics Execution --> Master Data --> Warehouse --> Storage Bin --> Create -->
Automatically.
2. To create a new template, choose New entries.
3. Enter the warehouse number, storage type and current number in the first section of the
screen. For the current number, enter any number that has not been used previously.
4. In the “Bin definition” section of the screen, enter values to define the template and
coordinates of the storage bins that you want to create.
For more information on how to enter data for defining the storage bin coordinate structure,
see the example.
5. You define the characteristics for all storage bins in the “Additional data” section of the
screen. As a minimum, you must enter a storage section, storage bin type and maximum
weight.
Save the characteristics data.
6. To generate the coordinates, choose Environment --> Create bins.
The system displays a screen with the storage bin characteristics and the coordinates of all
the bins that will be generated based on your entries.
7. If the data is incorrect, return to the data entry screen, make the necessary corrections, and
save the data again.
If the data is correct, choose Create online to create the storage bins or Create by batch input
to create the bins later in batch mode.
Example: Creating Several Storage Bins
If you chose to create the storage bins in batch mode, the system returns to the data entry
screen with a message stating that a batch session was created.
Make a note of the batch session name for subsequent processing.
Example: Creating Several Storage Bins
To create the following series of storage bins (coordinates)
02-1-020 02-2-020 03-1-020 03-2-020
02-1-040 02-2-040 03-1-040 03-2-040
You complete the Bin Definition section of the automatic bin creation screen in the following
manner:
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Template
The template field is used to specify the numeric and non-numeric characters
from which bin coordinates are built.
--> N represents a variable numeric value.
--> C represents a constant.
--> A represents ascending alphabetic values.
Note: Two alphabetic variables (2 A’s) cannot be entered next to each other.
Structure
The structure field is used to group together the numeric characters (N-values of the
template) into individual variable sections.
These sections are counted by the system.
You must enter the numeric characters in exactly the same positions as the alphabetic
characters in the template.
Start value
This data field specifies the storage bin to be created first in a range of storage bins.
End value
This data field specifies the storage bin to be created last in a range of storage bins.
Increment
In this data field, you define the increment for the individual variables (N or A) in the
template.
Quant
This is the stock of any material with the same features in one storage bin. The system
manages different batches of a material as different quants. The quantity of a quant can be
increased by an addition to existing stock. Quants can be created or deleted solely through
goods movements.
The quants serve to manage stocks at storage bin level.
When you store goods in an empty storage bin in WM, the system automatically creates a
quant in this bin.
The system automatically assigns a quant number.
The quant is automatically deleted by the system when the material quantity is picked.
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ASAP Methodology
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ASAP
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ASAP (Accelerated SAP) methodology
Phase I: Project Preparation
• Decision makers define clearly Project objectives and an effective decision making
process.
• Define Project organization and Roles.
• Implementation scope is finalized
• System Landscape and technical requirements are finalized
• Infrastructure (Hardware/Interfaces)
• High level Strategies for client
• Archiving strategy
• Issues of Data bases
• Other issues like
• Unanticipated tasks
• Normal tasks that can not be completed
• External factors that need to be dealt with
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Important MM Tables
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Important MM Tables
EINA - Purchasing Info Record Gen Data LFA1- Vendor Master (Gen Section)
EINE - Purc. Info Record Pur. org data LFAS -do- (VAT Regd Nos- Gen. Section)
EIPA - Order price History Info Record LFB1 - -do- (Company Code)
EIKP - Export/Import Header Data LFB5 - -do- (Dunning Data)
EIPO - Export/Import Item Data LFBK - -do- (Bank Details)
KONH - Conditions Header LFC1 - -do- (Transaction figures)
KONP - Conditions Item LFC3 - -do- (Spl G/L Transaction figures)
KONM -Conditions(Dimensional Qty Scale) LFM1 - -do- record purchasing org data
KONW- Conditions (Dimensional Value Scale)
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SAP MM Tcodes
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SAP MM TCODES
All transaction Tcodes are stored in table TSTC. Transaction Tcodes for MM module start
with M.
Material Creation
Stock Services
RFQ
ME41 Create Request for Quotation ME42 Change Request for Quotation
ME43 Display Request for Quotation ME44 Maintain RFQ Supplement
ME45 Release RFQ ME4B RFQs by Requirement Tracking Number
ME4C RFQs by Material Group ME4L RFQs by Vendor
ME4M RFQs by Material ME4N RFQs by RFQ Number
ME4S RFQs by Collective Number ME80A Purchasing Reporting: RFQs
ME9A Message Output: RFQs
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Outline Agreement
Contract
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Scheduling Agreement
Purchase Order
Physical Inventory
MIBC - ABC Analysis for Cycle Counting MI01 - Create Physical Inventory Document
MI02 - Change Physical Inventory Doc MI03 - Display Physical Inventory Doc
MI21 - Print physical inventory document MI04 - Enter Inventory Count with Doc
MI05 - Change Inventory Count MI06 - Display Inventory Count
MI07 - Process List of Differences MI08 - Create List of Differences with Doc.
MI09 - Enter Inventory Count w/o Doc MI10 - Create List of Differences w/o Doc.
MI11 - Physical Inventory Doc Recount MI20 - Print List of Differences
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Batch determination
MI31 - Batch Input: Create Phys. Inv. Doc. MI32 - Batch Input: Block Material
MI33 - Batch Input: Freeze Book Inv. Bal MICN – B.I/p PI Docs for Cycle Counting
MIK1 - Batch Input: PI Docs Vendor Cons. MIQ1 - Batch Input: PI Docs. Project Stock
MI34 - Batch Input: Enter Count MI35 - Batch Input: Post Zero Stock Bal
MI38 - Batch Input: Count and Differences MI39 - Batch Input: Document and Count
MI40 - Batch Input: Doc., Count and Diff. MI37 - Batch Input: Post Differences
Vendor Evaluation
General Analysis
ME88 Set Agmt. Cum. Qty./Reconcile Date ME91 Purchasing Docs: Urging/Reminding
ME98 Archive Purchasing Documents MEAN Delivery Addresses
ME91A Urge Submission of Quotations ME92 Monitor Order Acknowledgment
ME92F Monitor Order Acknowledgment ME92K Monitor Order Acknowledgment
ME92L Monitor Order Acknowledgment ME99 Messages from Purchase Orders
ME91E SA Schedules: Urging/Remind. ME9E Message Output: SA Schedules
ME9L Message Output: Scheduling Agreements
Conditions
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MEKH Market Price MEKI Conditions for Inco-terms
MEKJ Conditions for Invoicing Party MEKK Conditions for Vendor Sub-Range
MEKL Price Change: Scheduling Agmts MEKLE Currency Change: SA
MEKP Price Change: Info Records MEKPE Currency Change: Info Records
MEKR Price Change: Contracts MEKRE Currency Change: Contracts
MEKX Transport Condition Types Purch MEKY Trans Calc. Schema: Mkt. Pr. (Purc)
MEKZ Transport Calc. Schemas (Purch) MELB Purchasing Transaction by Track No.
Mass Maintenance
Quota Arrangement
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Standard Reports in
Material Management
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Purchase Order
ME2L - By Vendor
ME2M - By Material
( to See the Open Purchase orders go to ME2M go to 'Selection parameters' field - by using
F4 (help)select WE101 and then press execute orF8 button)
ME2C - By Material Group
ME2N - By PO Number
ME80FN - General Analyses
ME2O - SC Stocks per Vendor
Stock Material
MMBE - for Stock Over View MM60 - List of materials Available Plant wise.
MB53 - Plant Stock Availability MB51 - Material Documents
MB52 - Warehouse Stock MR51 - Accounting Document for Material
MB5B - Stock for Posting Date MBSM - Cancelled Material Documents
MB5T - Stock in Transit
MBLB - Stock with Subcontractor
MB5S - List of GR/IR Balances
Vendor Evaluation
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Extra Topics:
Blanket Purchase Order
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• Purchase Order with a validity period (start / end date) and a limit on the item.
• No Goods Receipt takes place.
• Payment is triggered by Invoice.
Notes:
• Multiple invoices can be processed.
• Main point is that invoices must be processed within the validity period specified in
PO.
• The total value of invoices must also not exceed the limit specified in PO item.
• The validity period is specified on PO Header Level, while the Limit is on Item level.
• The creation of Purchase requisition is Optional.
• Purchase Requisitions doesn't have validity period fields, although the limit can be
specified on item level.
• So if users create PR's then they could type the validity period simply as text in one of
the long text fields.
• During invoicing, if the date is outside validity period or the amount is bigger, either
a Warning or Error will occur. This setting is done in customizing.
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o Look at processes where Financial invoices (no PO) are used. To improve
control, a lot of vendor invoices could be moved to Blanket Order process.
• The Overall Limit is the value that will be used to in the check during invoicing. If
Commitment is switched on in Costing, the Expected value is the value of the
commitment against in this case the Cost Centre.
• The actual will be posted during invoicing.
• Account assignment is mandatory, so this process is non stock purposes only.
• Stock can not be procured using this method (For stock a GR is required).
• Because no Goods Receipt (GR) will take place, the GR indicator is switched off
when the item category is selected.
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Extra Topic:
How to attach a document to
Purchase order document
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You can attach manually any document to PO without using Document Management System
(DMS) in SAP 4.6C.
Please note that you cannot attach document while you create PO in T/Code ME21N. In
order to achieve this, follow the steps given below:
Service for Object button available down side of Command screen (in your PO screen
ME22N)
Click your Service Object button -> Create - > Create attachment then select your window
directory (which file you need to attach) select your file Now your system shows
message Service "Create attachment" is started.
Save again your PO. You can see (open) your attachment in same field (Service for Object)
select and Create and check attachment list. You can attach as many document in your PO.
Important Note: This is only information for internal or you can print separately this
document for sending to vendor (fax) System will not print automatically along PO print out.
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Lab Exercises:
Creation of
Organization Structure
Customization steps in MM
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1. Define company
SPRO Æ Enterprise Structure Æ Definition Æ Financial Accounting Æ Define
Company
2. Edit, Copy, Delete, Check Company Code
SPRO Æ Enterprise Structure Æ Definition Æ Financial Accounting Æ Edit,
Copy, Delete, Check Company Code
3. Maintain Controlling Area
SPRO Æ Enterprise Structure Æ Definition Æ Controlling Æ Maintain
Controlling Area
4. Define valuation level
SPRO Æ Enterprise Structure Æ Definition Æ Logistics - General Æ Define
Valuation level
5. Define, copy, delete, check plant
SPRO Æ Enterprise Structure Æ Definition Æ Logistics - General Æ Define,
Copy, delete, check plant
6. Maintain storage location
SPRO Æ Enterprise Structure Æ Definition Æ Materials Management Æ Maintain
storage location
7. Maintain purchasing organization
SPRO Æ Enterprise Structure Æ Definition Æ Materials Management Æ
Maintain purchasing organization
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A) Define Organizational Objects
1. Define company
Then Click the following screen will appear enter the Short description as TATA
Projects
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Press
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The following screen
Press
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Click for different messages until you get the following message
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Click
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3. Maintain Controlling Area
SPRO Æ Enterprise Structure Æ Definition Æ Controlling Æ Maintain
Controlling Area
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Now edit the following fields
And click
Press .and
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4. Define valuation level
SPRO Æ Enterprise Structure Æ Definition Æ Logistics - General Æ Define
Valuation level
The following screen will appear
Note:
1) In this step we don’t do any thing. Here we will come to know that the
valuation level is set to plant level by SAP it self (SAP recommends setting
material valuation at plant level.)
2) In case of you need to set at company code level, you have to approach for
change with reasons
Important note:
1) Once set, it is not possible to switch the valuation level from plant to
company code, or vice versa.
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Enter Plant
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Press and click
Enter the following fields
Then click
Press then status bar will show this message then press
two times.
Repeat the same for the TPL2 also
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Click
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then
Click
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Now
Then double click left side
Then click
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10. Assign plant to company code
SPRO Æ Enterprise Structure Æ Assignment Æ Logistics - General Æ Assign
Plant to company code
Click and enter the company code and plants information.
Then press enter.
Then click
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Then click
Then click
Now so far total Organizational Objects/Units have been defined and assigned .
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Click and
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System Shows the TMOT Company code and its Organization structure
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Lab Exercises:
Material Master
IMG settings & Creation
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Master Data – Material Master
IMG Settings in Material Master
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LAB Exercise:
1. Define Output Format of Material Numbers
SPROÆ Logistics - General Æ Material Master Æ Basic Settings Æ Define Output
Format of Material Numbers
Note:
1. In this step you can change the length of the number. Maximum length
provided by SAP is 18
2. Indicator for Lexicographical
Defines the way numeric material numbers are stored in the database.
a. If this indicator is not set, numeric material numbers are padded with
leading zeros and stored right-justified [Material numbers containing
at least one nonnumeric character are stored left-justified]
i. Example: if the Internally/externally assigned number
If the number is 123
The stored number is 000000000000000123
.
3. Indicator for leading zeros
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You can specify whether a numeric material number is to be shown with
leading zeros to fill up its defined length.
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Note: See that ABP (Allow Back Posting) check box checked
Click save button
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SPROÆ Logistics - General Æ Material Master Æ Basic Settings Æ Material Types
Æ Define Attributes of Material Types
The Following screen will appear:
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Now change the name and description of the material type as under:
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Now check the check box of Qty and Value update columns of TPL1 and TPL2
plants
Then click
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Press the status bar states that the data has been saved
Then press
[In this step, you define the type of number assignment and the number range
intervals for material master records.
When creating a material master record, you must assign it a unique number. There
are two ways of doing this:
1. Internal number assignment
Number within the number range interval allowed is assigned by the SAP
system.
2. External number assignment
The user assigns a number within the number range interval allowed.
You can define the intervals for external number assignment numerically and
alphanumerically.
Note:
1. You define the number range intervals for so-called groups. You assign one or
more material types to each group.
2. SAP recommends using internal number assignment]
The Following Screen will appear:
Now click button and do the following step in the next screen on menu
bar
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Now enter the Group name and number range data in the screen as under:
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Now check the check box of TATA Raw mat no range group as under
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then button
Then the TROH mat type will be assigned to this group
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5. Define Material Groups
SPROÆ Logistics - General Æ Material Master Æ Settings for Key Fields Æ Define
Material Groups
[Materials can be categorized based on its properties is called Material Groups]
Now click ‘New Entries’ and empty screen will appear as under
Now enter the following data
Purch. Org Description
TPO TATA Purch. Org
Then Click Save button.
6. Create Purchasing Groups
SPRO Æ Materials Management Æ Purchasing Æ Create Purchasing Groups
[A purchasing group can be an individual or a group of individuals.]
System shows a list of purchasing groups.
Click The following screen will appear:
Click
And press .
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Errors List:
Common Errors &
Solutions
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ERRORS List
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Error: 1
Account assignment mandatory for material 300000100 (enter acc. ass. cat.)
Solution:
SPRO --> Logistics - General --> Material Master --> Basic Settings -->
Material Types --> Define Attributes of Material Types (or TCode: OMS2)
Error: 2
Solution:
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Error: 3
Source not included in list despite source list requirement
Error: 4
Field selection for movement type 561 / acct 399999 differs for Ext. GA amount in LC
(023)
Solution:
TCode: FS00 enter your company code in Left side by clicking then press find button of
the left side and enter the account number 399999 and press enter.
In the right side screen, click Create/bank/interest tab
I. Check Post automatically only
II. Enter ‘Field status group’ as G006 Material accounts
Click Save
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Error: 5
For object RF_BELEG SMOT, number range interval 49 does not exists FBN1
Error: 6
Posting period 008 2010 is not open
Period 008 of fiscal year 2010 is not open for posting for the variant of posting period
1000.
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Error: 7
Number range for trans./event type IB in year 2010 does not exist
Solution:
Execute TCode: OMBT
Error 8
Enter rate EUR / INR rate type M for 16.12.2010 in the system settings
Error: 9
Country IN does not store a hard currency
Error: 10
Company code not assigned to country or country to calculation procedure
Solution:
SPROÆFinancial Accounting ÆGeneral settings in financial accountingÆ Tax on
sales and PurchasesÆ Basic settingsÆAssign country to calculation procedure
Click Position, Enter Country = IN and enter TAXUS against IN and save it.
(In case if you have already your calculation procedure you can assign the same.
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Question 1: What MRP procedures are available in MM-CBP (Consumption Based Planning)?
A: Various material planning methods are used in MRP (Material Requirements Planning) Reorder
point procedure (VM) Forecast-based planning (VV) Time-Phased materials planning (PD) These
are specified in material creation (MM01) under the MRP 1 tab.
Question 2: Under what conditions are “planned orders” created? What may-planned orders
are converted to and how is that conversion accomplished?
A: Planned orders are always created when the system creates an internal procurement proposal. In
the case of vendor procurement, the MRP Controller may create a planned order or directly create a
PR. The next step for a planned order is to be converted to a PR so it goes to purchasing and is to
eventually become a PO. A planned order can be converted to a PR using transaction code
MD14.
Question 3: What are the organizational levels of the Enterprise Structure in R/3?
A: The top level of the organizational plan is the Client, followed by Company Code, which
represents a unit with its own accounting, balance, P&L, and possibly identity (subsidiary). The next
level down is Plant, an operational unit within a company (HQ, Assembly Plant, Call Center, etc.).
The Purchasing Organization is the legally responsibly group for external transactions. This group is
further subdivided into Purchasing Groups.
Question 6: What are some of the options available to transfer materials from one plant to
another?
A: Although it is possible to transfer materials from one plant to another without a Stock Transport
Order, many advantages are lost including entering a vendor number, planning a goods receipt in the
receiving plant, monitoring process from PO history, and the ability to create STO directly from a
MRP PR.
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Question 7: What are some of the common Stock Transport Order Movement Types?
A: One-step transfers of materials can be posted using MT 301. Other various transport scenarios
differ in the MTs by the Goods Issues and Good Receipts. Common Goods Issues may use MTs 303,
351, 641, or 643 in the STO. A STOs Good Receipt often uses MT 101.
Question 8: What is the difference between a Purchase Order and a Purchase Requisition?
A: A Purchase Requisition is a document type that gives notification of a need for materials or
services. A Purchase Order is a document type that is a formal request for materials or services from
an outside vendor or plant. Procurement types may be defined at the line item and can be standard,
subcontracting, consignment, stock transfer, or an external service.
Question 10: What is an RFQ and how is it different from the Quotation Form?
A: A RFQ is a purchasing document and an invitation to a vender(s) for quotation regarding needed
materials or services. If multiple an RFQ is sent to multiple vendors, the system can automatically
determine the best quote and send rejection letters in response to all others. The RFQ and the
Quotation Form are one in the same in the system as vendor’s quotes are entered directly in the
RFQ.
Question 11: What are the transactions that will result in a change of stock?
A: A Goods Receipt is a posting acknowledging the arrival of materials from a vendor or
production, which results in an increase in warehouse stock, a Goods Issue which results in a
reduction in stock, or a Stock Transfer moving materials from one location to another.
Question 12: When would it be prudent to post goods movements via the Shipping
Application?
A: If picking, packing, and transportation operations need to be planned in detail. Also, in shipping,
you can manage movements like returns from customers, vendors, and returns to stock. Movement
Types in shipping start with a 6.
Question 14: Can you manually generate a Purchase Requisition referencing a Purchase Order
or a Scheduling Agreement?
A: A Purchase Requisition cannot be created with reference to either of these, as they are documents
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controlled by the purchasing organizations. Requirements can be automatically generated with MRP
that reference a Scheduling Agreement if the source list is maintained for item-vendor combination.
Question 16: How do planned and unplanned consumption affect Movement Types?
A: In a customized Movement Type, you have defined which consumption value gets posted in the
movement. Many will always be planned or unplanned, but for some there is a dependency on if the
movement references a reservation. This would be planned consumption.
Question 19: Why would you want to create physical inventory sheets to perform an inventory
cycle-count on a material or materials?
A: For a cycle counting procedure, physical inventory documents need to be created. These are used
to record inventory levels of the material being cycle counted. Use transaction MICN. Click on the
Execute button. On screen “Batch Input: Create Physical Inventory Documents for Cycle Counting”,
perform the following, Click on the Generate Session button and Click on the Process Session
button. This procedure details how to create the physical inventory documents for cycle counting in
a batch, rather than one at a time, based on certain criteria. This would print physical inventory
documents for all material/batches that meet those requirements.
Question 20: What is the difference between a Blanket Purchase Order and the Framework
Order?
A: In general, the Blanket POs are used for consumable materials such as office paper with a short
text, with item category B. There need not be a corresponding master record, for the simplicity of the
procurement. The FO, Framework Order, document type is used. Here, the PO validity period as
well as the limits are to be mentioned. The GR, or Service Entry for the PO is not necessary in the
case of Blanket POs. One need not mention the account assignment category during creation of the
PO. It can be U, or unknown and be changed at the time of IR.
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Question 21: What is Release Procedure?
A: Release Procedure is approving certain documents like PRs or POs by criteria defined in the
configuration. It is sensible to define separate release procedures for different groups of materials for
which different departments are responsible, and to define separate procedures for investment goods
and consumption goods.
Question 22: If you have a multi-line item PO, can you release the PO item by item?
A: No, a PO is released at the header level meaning a total release or “With Classification”. PRs, on
the other hand, have two release procedures possible. “With Classification” as described above, and
“Without Classification” where it is only possible to release the PR item by item.
Question 26: What are the various “steps” in the MM Cycle from material creation through
invoice?
A: The following creates a rough picture of the MM Cycle. Create material, create vendor, assign
material to vendor, procure raw material through PR, locate vendor for certain material, processing
GR, goods issue, and invoice verification.
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most important characteristic of Consignment Stock is that it isn’t valuated. When the material is
withdrawn, it is valuated at the price of the respective vendor. Before procuring the stock,
consideration should be given if one consignment is coming from multiple vendors. If so, we can
manage all of them independently at the price of the individual vendors. In the Info Record, we will
maintain three different prices for the same material for three different vendors.
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Question 35: How do you adopt standard settings for the Message Determination Facility In
MM-PUR?
A: The Message Determination Facility is by default active and message determination schema is
supplied for all purchasing documents including POs, PRs, RFQs etc. All of the desired message
types must be maintained. Choose Master data Messages Purchasing document Create or
Change from the Purchasing menu. Add the message type and pick the key combination. The key
combination decides the condition table where the condition record is stored. Enter all needed items.
Next screen, create the individual condition records. Using the menu options Goto Means of
Communication, enter the proper peripheral, or output for each message record. Save.
Question 36: How do you set price control for receipts (goods/invoice) telling the system how to
value stocks?
A: Transaction Code OMW1 allows you to set price control to S (Standard Price) or V (Moving
Average Price). Under Standard Price (S), the materials and accounting documents are both valid.
The one with the lower value will be posted with a price variance entry.
Question 37: How do you access the Materials Management Configuration Menu?
A: Transaction Code OLMS has a host of options that are not accessible through the IMG.
Question 39: What are some of the more important Materials Management Tables?
A: EINA contains general data of the (Purchasing) Information Record; EINE includes Purchasing
Organization of the same. MAKT is the Materials Description table, MARA-General Materials data,
MARC-Plant Data for Materials, MARD-Storage Location Data for Material, MAST-Material to
BOM Link, MBEW-Material Valuation, and MKPF-Header Material Document. Some of the tables
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that directly pertain to the document types are T156 Movement Type and T023/T024 Groups
Material and Purchasing.
Question 40: Can you add custom fields to POs and RFQs?
A: Yes. You must add custom fields to the customer including structures I_EKKODB and
I_EKPODB. Create a project via CMOD for enhancement MM06E005. Follow the documentation
for MM06E005, and create the sub-screens for function group XM06 using transaction SE80. Add
fields to the appropriate screen. It is recommended that you call the screen fields EKPO_CI-name or
EKKO_CI-name. This simplifies transferring data to/from the screen. Put code in
EXIT_SAPMM06E_018 to transfer data from sub screen to structure E_CI_EKPO. Put code in
EXIT_SAPMM06E_016 to transfer data from database to sub-screen using structure I_CI_EKPO. In
the PBO of the sub-screen, do any processing to make fields display only, or hide them. If you need
values from the main screen to make decisions in the sub-screen, define variables in the global data
part of the function module, and fill the variables in EXIT_SAPMM06E_016 (PBO of main screen)
Make sure everything has been activated like user exists, screens, etc.
Question 41: Where can you dictate how Planned Orders are converted into Requisitions in
MRP?
A: Look at the Transaction Code OPPR indicator. Assign proper indicator.
Question 42: What SAP program is used to update or create Material Master Records?
A: RMDATIND is used to update Material Master Records and can be used for such assignments as
extending all materials to a new plant.
Question 45: When creating a new Material, what may prompt some of the possible Material
Types?
A: Pressing F4 gives a list of choices. Select the material type for the material you are creating. For
example, FHMI for Prod. Resources/tools, ROH for Raw Materials, FERT for Finished Products,
etc.
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Question 46: How do you determine which views of a material need to be added or to see which
plants a material has been extended to?
A: You can use transaction MM50. To extend a material to a different plant requires selecting the
new plant on the organizational level screen. Note that all views of a material are not extended
unless they were selected on the initial screen. In addition, each plant may have a different system
configuration requiring additional inputs on each of the departmental screens. Material changes
made in one plant do not change that material in other plants.
Question 47: How can you set user defaults for views and organizational levels?
A: The user defaults for views can be set under Menus: Defaults Views. Select those views to be
checked on by default when generating a new material. Select ‘View selection only on request’ when
the select view pop-up is to be by-passed unless selected. For organizational levels, Menus: Defaults
organizational levels. Enter those organizational levels to be defaulted when generating a new
material. Select ‘Org. levels/profiles only on request’ when the select view pop-up is to be bypassed
unless selected.
Question 48: What needs to be present in order for Material Type to be automatically copied
from one view to another?
A: When creating any view, the Industry Sector and Material type will be automatically copied from
an existing view, so long as at least one view exists.
Question 49: How do you create a document/e-mail notifying your supplier or internal
personnel when an invoice plan is settled?
A: The IMG setting is Material Management Logistics Invoice Verification Message
Determination. If these settings are not made, the message “Invoicing Plan: No Message Was Found
for Partner XXX, Company Code XXX”. If the notifying documents are not required, simply turn
off the message by changing the message from “error” to “information” using Material Management
Logistic Invoice Verification Define Attributes of System Messages.
Question 50: How can one keep users from using standard MM Movement Types?
A: Standard Movement Types should not be deleted from the system. The account assignments,
however, may be deleted for a particular Movement Type in table T030 using transaction OBYC.
Another way to achieve the same result is to enter Movement Type in transaction OMJJ. Remove
MBXX from allowed transactions.
Question 51: How do you define a Release Procedure for PRs and POs?
A: Use Transaction ME54 and ME28 respectively.
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Question 53: How do you create a Class?
A: Class is defined as the group of characteristics, which can be attributed to a product. Use
Transaction CL01. Enter the value for the Class name and a small description. Select the group from
it. The values on the different tabs are not mandatory, so you can skip the values if you wish or you
can go to any extent needed. Save, and the Class is created.
Question 55: Will ROH have a sales view? Will FERT have a purchasing view?
A: They shouldn’t because ROH type materials are procured from the outside not sold and FERT
type materials are created inside and aren’t procured. In some special cases, we have to sell raw
materials (ROH) and buy finished goods (FERT) from outside sources. The views must be extended
in these cases using transactions OMS2 and MM50.
Question 56: Where do we create Vendor Account Groups, or screen layout in Vendor
Master?
A: Using SPRO, Financial Accounting Accounts Payable/Receivable Vendor Accounts
Master Records Preparations for Creating Vendor Master Records Define Account Groups
With Screen Layout (Vendors) or Define Screen Layout Per Activity.
Question 57: What are the key fields for the Material Master?
A: Material Groups, External Material Groups, Divisions, Material Status, Labs & Offices, Basic
Materials, Storage Conditions, Temperature Conditions, Container Requirements, and Units or
Measure Groups.
Question 60: What are some of the data points provided by Purchasing for a material?
A: Some of the key inputs when creating a material are Base Unit of Measure, Purchasing Group,
Reminder days, tolerance levels, shipping instructions, GR processing time, JIT schedule indicator,
Critical part (?), etc.
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Question 61: What are the Lot Size attributes a material can posses?
A: Lot Sizing dictates the reorder quantity for a material. A material can have a static, periodic,
optimum, or fixed lot size.
Question 65: How do you create the Information Record based on the Material Master record?
A: In the IMG, Master Data Info Record Create. Enter Vendor Number, Material Number,
Purchasing Organization or Plant Number. Enter the number of the Information Record if external
number assignments are used (left blank, the system will assign a number). Enter the General Data
for the Vendor, order unit, origin data, and supply option, Customs Tariff Number. Next, enter the
Vendor’s planned delivery time (used for scheduling), responsible Purchasing Group, and Standard
PO quantity (used in conjunction with price scales for price determination). Check the Control Data.
The tolerance data and the responsible purchasing group are taken as default values from the
Material Master record. Enter the net price. Now, from the top of the screen Go To Texts to
display the text overview. You can enter the info memo or the PO text. If the PO text is already
defined in the Material Master record, it appears as a default value. Save the record.
Question 66: What are some of the initial configuration steps for Purchase Requisitions?
A: Define Document Types, Processing Time, Release Procedure (with and without classification),
Setup Authorization Check for G/L Accounts, Define Number Range.
Question 67: When, in initial configuration, why would you have to Setup Stock Transport
Order?
A: If it is required to carry out an inter-plant Stock Transfer through SD, then this configuration is
required and must be carried out.
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Question 68: What are some of the initial configuration steps for Inventory Management?
A: Plant Parameters, Define System Message Attributes, Number Assignment (Allocate document
type FI to transactions), Goods Issues, Transfer Postings, Define Screen Layout, Maintain Copy
Rules for Reference Documents, Setup Dynamic Availability Check, Allow Negative Stocks (?).
Question 69: What are some of the initial configuration steps for Physical Inventory?
A: Define Default Values for Physical Inventory Document, Batch Input Reports, Tolerances for
Physical Inventory Differences, and Inventory Sampling. Cycle Counting should be configured as
well.
Part III:
Practical/Troubleshooting Related Questions
Question 70: How can you process vendor returns without a Purchase Order reference?
A: Use Transaction Code ME21N. Look for the Return columns and click it at the item details,
MIGO_GR , Goods Receipt for Return Purchase Order_ Movement type will be 161 to deduct the
stock and 162 for reversal._ Before saving, check if there is a check in the Return Column to ensure
that it is a return Purchase Order.
Question 72: How do you change the standard price in the Material Master?
A: The standard price in the Material Master can’t be updated in a direct manner. A great way to
update it is to fill the fields Future Price MBEWZKPRS and the Effective Date MBEW-ZKDAT for
the material on the accounting view. Next, go to Logistics → Materials Management → Valuation
→ Valuation Price Determination → Future Price → Activate. TCODE MR2B, program
RMMR2100. Lastly, run the BDC that was created to update the standard price.
Question 74: How can you post a Goods Receipt if the PO number is not known?
A: If you selected PO Number Not Known in Transaction MIGO, you can specify search criteria for
the POs on the initial screen. The system then displays a list of purchase orders. Select and copy the
required PO items.
Question 75: How do you display a list of all reservations in the system?
A: Run report RM07RESL.
Question 76: If you have created a custom Movement Type and you get a “not allowed” error,
where should you first look for the cause?
A: Using Transaction Code OMJJ, check “Allowed Transactions” for the customized Movement
Types.
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Question 77: How do you find the logical value for stock item by date?
A: Use Transaction MC49.
Question 80: How do you generate an automatic PO after creating a PR using a particular
material?
A: In MMR and VMR check Auto PO (MM02/XK02). Maintain the Source List and select the
indicator for the source list record as MRP relevant (ME01). If more than one source list record is
generated, make one of them fixed. Run MRP and the PRs generated will be pre-assigned with the
source of supply (MD01). Enter ME59 for automatically creating POs from PRs.
Question 81: Where is the Header level and Item level data saved in a PO?
A: In SE11, we can see this information in table EKKO and EKP0 respectively.
Question 84: What is the difference between a PR with a Master Record and without a Master
Record for the material being ordered?
A: If the master record exists, then all of the information about the Source List, Information Record,
and Vendor Evaluation already exist in the system. If we don’t have a Master record for the material
we are ordering, the material is generally being ordered for direct usage or consumption. You can
specify which consumption account is to be charged which is also known as Account Assignment.
For example, we assign the purchase costs associated with a requisition to our sales order or cost
center. If the first situation exists, many times purchasing enters into a longer-term purchasing
agreement with a Vendor, which is called an “Outline Agreement”. If the Outline Agreement is
done, then Purchasing cannot issue a purchase order against a PR. It can only set up such an
agreement (either a “Contract” or a “Scheduling Agreement”).
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Question 85: Can you change a Purchase Requisition after it has been created?
A: Yes. Use Transaction ME52N. Check to see if the PR has already had a PO issued against it. If
so, you must inform the Purchasing Group. Check if the PR has been approved. If so, you may only
make changes to a limited extent and may be subject of approval. Check if the PR was created by
MRP. In this case, you don’t have much control over the modification process. All changes to items
are logged and stored. Information stored includes when the information was changed, who changed
it, what the changes were, etc. Select the desired item in the item overview and choose Go To
Statistics Changes.
Question 87: What is Vendor Evaluation and how do you maintain it?
A: Vendor Evaluation helps you select the Source of Supply by a score assigned to a particular
vendor. The scores are on a scale of 1 to 100 and are based on differing criteria. Use Transaction
ME61 and enter the Purchasing Organization and Vendor Number.
Question 88: What are the components of the Master Data that details a company’s
procurement; used by, Vendor Evaluation for example?
A: The key components of Master Data are: Info Record (ME11), Source List (ME01), Quota
Arrangement (MEQ1), Vendor (MK01), Vendor Evaluation (ME61), and Condition Type (MEKA).
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transaction accessed per user login. To reach the Goods Issue Purchase Order screen, click the
Dropdown Icon in the transaction field and select “Goods Issue”.
Question 96: What do the W, V, and F fields show about the status of a document in FBV3?
A: An X under the W column means the document is subject to Workflow. Most documents on this
screen should have an X in this column. However, not all documents are subject to workflow (cash
deposits etc.). An X in the V column means that the document has been marked as complete. If they
are subject to Workflow, they have been sent to Workflow for approval when they were marked
complete. An X in the F column means that the document has been approved and posted to
expenditures. This column will always be empty in this screen. An X under W, but no X under V
means that you have not marked the document as complete. If it hasn’t been marked as complete,
use FBV2 to check the document and, if it is correct, mark it as complete. You can quickly go to the
document from the list screen by double clicking on the document number. When the document is
displayed, click on Document on the menu bar, and then click on Change in the drop down menu.
The transaction will switch from FBV3-Display to FBV2- Change. An X under both W and V will
mean it is waiting for approval and you may need to check the approval path to see if has met with a
delay.
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Question 97: If you are using Transaction MRKO, vendor settlement, and we get an error
message (FS217 or M8443 etc.), how would you go about troubleshooting this?
A: (With this question, look for an answer that follows a similar logic) To troubleshoot this problem,
we have these steps to follow. Set up Output Condition Type “KONS”. The Output Type specifies
the kind of output to be produced. The Output Type is predefined for your area of the R/3 system. If
alternative choices are possible, you can, of course, list them by pressing F4. The Output Type can
specify, for example, a printed form that you need for internal use or a form that you want to send to
a customer or vendor (for example, an order confirmation). The Output Type can also be an internal
electronic mail message that you want to send to staff in another department. To create an Output
Type, we use Transaction V/30. Click on New Entries; go to where you can define a new Output
Type (i.e. KONS). Once you have fed all of the data in the screen you can save it and we will have a
new Output Type. Now, use Transaction MRM1 where we will maintain conditions for the Output
Type KONS. When you press the Key combination tab, you go to the “Create Condition Records
(Consignment): Fast Entry” screen. Here you define the Company Code, partner etc. Hit the save
button. Now you have conditions associated with the Output Type KONS. Now, we must maintain
the appropriate Tax Code in the Information Record. Use Transaction ME12. Be sure Info Category
is consignment. Hit <Enter> and you will go to the screen “Purch. Org. data 1”. Hit <Enter> again
and you will go to the next screen where you need to maintain the Tax Codes. Put in Tax Code “I0”
which means exempt. The next step would be to go to the G/L Account and update the “Tax
Category” using Transaction FS00. “Drop down” the box for Tax Category and you will get some
options. Choose the first option “-“ Only Input Tax Allowed. Hit Save. The next step, go to check
the “Field Status Compatibility at G/L Account”; use Transaction SE38. Now, enter the program
number “RM07CUFA” and hit “Execute”. Now enter Movement Type “291 K” which is used for
the Goods Issue related to consignment. When you press the Execute button, you will see screen
“Field Selection Comparison: Movement Type – G/L Account”. Now, check the Compatibilities of
all the fields, if a particular is not compatible, then there will be an Error message with a Red
Highlight. Now the signs Plus, Minus, and dot denote whether the entry in that particular field is
“Required”, “Optional”, or “Suppressed” etc. Now, the error could be because of the following
reasons: If the Mvt column has a “+” and Account column has a “- “; If the Mvt column has a “-“
and the Account column has a “+”. Once you fix the value you can go to the Error Log and see if
there are any more errors there. The last step would be to run Transaction MRKO. Now, you get all
of the “Not Settled”, “Pending Transactions”, or Good Receipts recently done. Then, go to the
previous screen and press the “Settle” tab and execute it again for settling the documents. Now the
transaction goes through and the vendors are paid automatically. If after doing this, we still get the
error message, then we could also go to Transaction OMRM and change the error message to a
warning message. The other place to find the error messages is Transaction SE31.
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LSMW- 14 STEPS
LSMW - Helpful hints for Support PM for transaction updates using recording option.
TCODE: LSMW
Here you have to first Define Project, Sub Project and Object. It is mainly for grouping the
objects. One can have multiple subprojects and Object in a Project.
Execute the transaction and you will get navigated to the second screen: LSMW Work
Bench. Here one can choose the required steps by pressing the ‘User Menu’ button.
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The following 14 steps are sufficient for Support person for the LSMW update.
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Step1. Maintain Object Attributes
Define the method of upload. i.e. batch recording , direct update , BAPI etc. Go inside this
step and choose the radio button for the options. This document explains only about the
transaction recording method.
One can toggle between the Display or change option using the standard button. Select the
object type and Import method as ‘Batch Input Recording’.
Once you have selected this click on the overview button so that you can go to the recoding
overview
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Example of a recording
After recording default those fields that you want to update /use in batch update.
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You have to define the mapping rules.., eg. Customer = customer. Or if any default value
has to be passed , or some fixed value is given like that ( company code can be a default
value if processing for a particular company code.
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After making all the mappings and initialization you can even do a syntax check to see
your mappings are correct or not
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Step10. Convert Data
Converting the source structure data to the destination by applying the conversion rules that
have mentioned in step 4 and step 5.
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Step 13. Run Batch Input Session
This step will call SM35 .One can run the session in SM35. You can run in foreground, Error
mode or background. Preferably run in Foreground for testing some few records…once
confirmed the update then run in back ground.
The LSMW projects can be transported between systems via export /Import method.
You can export the entire project as a text file and that can be imported to another system.
In MSS no changes are allowed, so before importing to MSS , give the MSS file path in
MST and then do an export .
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CREATION OF CHARACTERISTIC :-
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CREATION OF CLASSES:-
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Enter description
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Press f3, f3(back) & click on release indicators
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Similarly create another release id as shown below. & save it , press f3 ,f3.
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Now click on new entries
Enter release grp, release strategy, & release codes as below.
Now click on release prerequisites. Check od check box & click on continue.
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Now click on release statuses
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Now save it & click on classification
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Following screen appears & click on simulate release to do release test
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Simillarly create release strategies with A3,A2,A1 in GI Group with these conditions
A3 = < 5000 & approval should be by plant manager A
A2 = >=10000 & approval should be by stock controller A & plant manager A
A1 = <10000 & approval should be by stock controller A.
Now create pur.req & we can release this pur.req itemwise.
Creation of purchase requisition
Now create pur.req t.code- ME51N
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Enter material , plant, delivery date, quantity & press enter button.
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Press Save .
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Click on release options in release strategy tab again to release PA as shown below.
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