OVERVIEW OF MATERIALS MANAGEMENT PROCESSES

Organizational Elements
The Procurement business process uses the following The Procurement business process uses the following organizational elements: organizational elements:

COMPANY CODE

Company Code

Plant

Storage location

Purchasing Organization

Purchasing group

Procurement Process

Purchase Order

8. Payment

Requirements 1.determination

Vendor invoice

2.

Source determination RUHR TRUCKING

7.

Invoice verification

3. Vendor

selection

6.

Goods receipt and inventory management

5.

Order follow-up

4.

Order Processing

The Procurement Process

Purchase Purchase Requisition Requisition for Goods/ for Goods/ Services Services Purchase
Requisition
10 20 30

RFQ & RFQ & Quotation Quotation Manit. Manit.

RFQ
10 20 30

Purchase Purchase Order Order

Purchase Order
10 20 30

Goods Goods Receipt Receipt

Invoice Invoice Processing Processing

Vendor invoice

Planning, Reporting, and Analysis

Purchase Requisition
The Procurement Process
Purchase Purchase Requisition Requisition for Goods/ for Goods/ Services Services
Purchase Requisition
10 20 30

Purchase Purchase Order Order

Purchase Order
10 20 30

Goods Goods Receipt Receipt

Invoice Invoice Processing Processing

Vendor invoice

Planning, Reporting, and Analysis

Purchase requisitions:
Request or instruction to the purchasing department to procure a certain quantity of a material or service on or by a certain date. Are created directly by a requesting department or automatically via material requirements planning (MRP). Are internal documents not used outside the company.

Important Terms in Purchasing,

Item Category : Key defining how the procurement of a material or service item is controlled. The item category determines the field selection and whether any additional data screens are shown. In addition, it determines whether a goods receipt or invoice receipt is to follow. Different types of Item categories are, Standard Subcontracting Consignment Service Third Party Stock Transfer

Purchase Requisition Processing

MRP

Direct Entry Purchase Order

Purchase requisition

Release strategy

Determine source of supply

Purchase Order
The Procurement Process
Purchase Purchase Requisition Requisition for Goods/ for Goods/ Services Services
Purchase Requisition
10 20 30

Purchase Purchase Order Order

Purchase Order
10 20 30

Goods Goods Receipt Receipt

Invoice Invoice Processing Processing

Vendor invoice

Purchase orders:

Planning, Reporting, and Analysis

Represent the formal approval of a purchasing transaction with a vendor. Identify the following items such as: Vendor Material and quantity ordered Price and terms Delivery date and location

Processing Purchase Orders

Purchase requisition Reference document

Contract

Purchase order

Vendor

10 20 30

Reporting and Analysis

Standard Reporting provides List Displays by: Vendor Material Account assignment Material Group Purchase order number General Analysis Order Value Analysis

Key Points

The basic procurement process includes: purchase requisition, Quotation maintenance, purchase order, goods receipt, and invoice processing Procurement master data includes the vendor and material master files.

INVENTORY MANAGEMENT

Goods Movement
Ad hoc. Goods Receipt

Delivery Inventory

Production Inventory Transfer Posting

Goods Issue
Consumption Samples

Goods Issue
Sales Order

GOODS RECEIPT
Goods receipt component is used to post the receipt of goods from an external vendor or from production. A goods receipt leads to an increase in warehouse stock.

GOODS ISSUE
Goods issue component is used to post a material withdrawal, a material issue, or a shipment of goods to a customer (without the involvement of the SD Shipping component). A goods issue leads to a reduction in warehouse stock.

Stock Transfer and Transfer Posting

You can use this component to remove materials from one storage location and place them in another storage location. Stock transfers can occur either within one plant or between two plants or company codes.

Transfer Posting Goods Issue

Emco Stk RM01 Vendor Stock Project Stk PS01 Network for consumption

Stor. Loc. RM01

Stor. Loc. WIP1

Unrestrct Stk

SO Stk

Stock Transfers

Thank you