4 Forwarding Order Management

TRAINING
SAP TRANSPORTATION
MANAGEMENT 8.1
4: Forwarding Order Management
Objectives
At the end of this module, you will be able to:

Explain the Configuration Steps
Explain the Process Details
Agenda
Business
Process
Solution
Purpose and Requirements
Overview
Description
TM8.1 Forwarding Order

Business Purpose
Focus
on the business processes of freight

forwarders or Logistics Service Providers (LSP)
With SAP Transportation Management 8.0, the
foundation of a forwarding order management for freight

forwarders was established
TM 8.1 focuses now on the business processes of freight
forwarders or logistics service providers

Key Requirements
TM
8.1 focuses now on the business processes

of freight forwarders
The following key requirements have to be addressed
in the area of forwarding order management
Manual and Automatic capturing and processing of
forwarding orders
Enable capturing of standard fields that are usually part
of an order from the customer
Short cut processes in forwarding order management
Controlled / Uncontrolled Shipment process
Incoterm Handling
Agenda
Business
Process
Overview
Solution
Description

Scenario - 1
Freight Forwarders
Gateway (CFS)
(Yokohama, Japan)
Station
of Origin
Pickups
Shippers (OtaKu, Gifu,

Japan)
LineHaul /
Feeder
Port-ofLoading
(Yokohama
Japan)
Forwarding
House Station
(Nagoya, Tokyo)
Freight
Forwarders
Gateway (CFS)
(Los Angeles, USA)
Station
of Destination
Port-ofDestination
(Long Beach
USA)
LineHaul /
Feeder
Deliveries
Forwarding House
Station
(San Diego, Phoenix)
Consignee
s
(Sedona,Tus
con, USA)

Scenario - 2

Definition
Forwarding
Order is an order from an ordering

party to a logistics service provider to transport
goods from one or multiple customers/shippers
to one or multiple consignee
Contains the following Information
Goods to be transported
Packaging/Resource Information
Quantities
Locations and Date/Times
Business Partners
Incoterms
Dangerous Goods
Stages
TM8.1 Forwarding Quotation

Definition
Forwarding
Quotation is
an offer by the logistics
service provider to the
customer for the
transportation of goods
Receive Quotation
from LSP
Create quotation with

basic transportation
data
Perform
transportation charge
calculation
Optionally assign
validity period to
Quotation
Accept / Reject
Quotation
Communicate
quotation back to
Ordering Party
Place Order with

reference to
Quotation
Convert quotation into

Forwarding Order

Process Details
Customer
Service
Representative
Forwardin
g Order
Processin
g
Forwardin
g order
creation
System
based
complianc
e checks
Transporta
tion
charge
calculation
Forwardin
g order
confirmati
on sent to
the
shipper
House B/L
printing &
Ocean Freight
Booking
Specialist
Ocean Freight
Booking
Ocean
freight
prebooking
creation &
sending to
ocean
carrier
Internal
Schedule
and
Capacity
provisioni
ng
Automated
ocean
carrier
communic
ation
(updates,
Transportation
Manager
Order
Management
Consolidat
ion / DeConsol
Consol &
Master B/L
Mgmt
Freight
Orders
Document
prep &
printing
Automated
carrier
selection
Automated
Commn to
warehouse
Dispatcher
Transporta
tion
Execution
&
Monitoring
Transportation
Charge Clerks
Invoicing &
Settlement
Transporta
tion
execution
event
monitoring
(SAP EM)
Freight
settlement
document
creation &
transfer to
ERP
Incident
manageme
nt
Self-billing
(in the
name of
service
provider)
Resolution
with
customer
through
customer
service
rep.
Customer
Billing &
Settlemen
t
Forwardin
g
settlement
document
creation &
transfer to
ERP
Customer
invoice
creation
(SAP ERP)
Agenda
Business
Process
Overview
Solution
Description

Process Control Attributes
Certain
attributes are introduced in TM8.1 to

define the nature of the business documents
and control their processing
Transportation Mode
Traffic Direction
Shipping Type
Movement Type

Process Control Attributes Transportation Mode
Transportation
Mode specifies how cargo is to

be transported, for example, by road, rail, sea
or air
Usually defined on the business document header level
and specifies the transportation mode of the main

carriage

Process Control Attributes Traffic Direction
Traffic
Direction specifies whether the transport

of the cargo is an import (inbound) or an export
(outbound) transport from the perspective of
the contracted organizational unit
The traffic direction if maintained in the business

document type customizing is taken over into the
business document during creation and cannot be
changed anymore

Process Control Attributes Shipping Type
Shipping
Type specifies the way how the

planning and execution of the transport of the
cargo should be performed
Available shipping types (LCL, FCL) can only be
specified for transportation mode Sea

Process Control Attributes Movement Type
Movement
Type specifies for which stages the

freight forwarder is responsible to organize the
transport of the cargo and thereby defines
which stage types are valid for the business
document.
Door to Door - The freight forwarder needs to pick
up the goods from the shipper (source location) and to
deliver it to the consignee (destination location).

Process Control Attributes - UI

Controlled Shipment
Freight
forwarder
scenario 1
Pre-,
main- and oncarriage are all handled,
subcontracted
and
invoiced by the freight
forwarder
NVOCC
or Carrier
Freight
Settlement
Document
Ordering Forwarding
Order
Party
Forwarding
Agreement
Freight
Agreement
Freight
Booking
Forwarding
Settlement
Document
Freight Forwarder

Controlled Shipment - UI

Uncontrolled Shipment
Freight
forwarder
scenario - 2
Freight
forwarder has
only control over the preand the on-carriage of the
transport
Freight
Agreement
Freight
Settlement ONLY
for Main Carriage NVOCC
Ordering Forwarding
or Carrier
Party
Order
Forwarding
Agreement
Freight
Agreement
Freight
Booking
FW Settlement
ONLY for Pre and
On Carriage
Freight Forwarder
Freight
Settlement ONLY
for Pre and On
Carriage

Uncontrolled Shipment - UI

Incoterm Handling
The
incoterms (such as EXW, FOB) are an

agreement between the seller (usually the
shipper in a forwarding order) and the buyer
(usually the consignee in a forwarding order) of
goods
Define how the responsibilities and costs for the
transport of goods are shared between seller and
buyer.
Since incoterms are agreed when the goods are
purchased, the freight forwarder is not involved at all
when incoterms are agreed.

Incoterm Handling - Practical Scenario
Two
dimensions of the overall cost settlement process

External Settlement
Defined by the Incoterms and Organizational Unit that has the

business relationship (forwarding agreement) with Shipper /
Consignee
Completely Independent of which Organizational Unit actually
organizes which part of the transport
Internal
Settlement
In an export-import scenario and incoterm FOB, the export

organization organized and paid pre-carriage and main-carriage,
but it is only paid from the shipper for pre-carriage
Export organization needs to settle costs for the main-carriage to
the Import organization which in turn settles the consignee for it

Incoterm Handling Agreement Party
Key
requirement is to identify which parts

(stages) of the transport is paid by whom
Prepaid Agreement Party
Prepaid refers to the business partners from whom the
goods are moving away

Collect
Agreement Party
Collect refers to the business partners to whom the
goods are moving to

Agreement
Party Type
Defines, whether the stage has to be settled prepaid,
collect, or not at all

Prepaid Agreement Party
The
business partner with whom a forwarding

agreement is made for the first part of the
transport, according to the agreed incoterms
Prepaid Agreement Party may also be prepaid bill-to
party and prepaid payer
The system uses the prepaid agreement party to
calculate the charges in the invoice for the seller

Collect Agreement Party
The
business partner with whom a freight

agreement is made for the last part of the
transport, according to the agreed incoterms
Collect Agreement Party may also be collect bill-to
party and collect payer
The
system uses the collect agreement party to

calculate the charges in the invoice for the buyer

Prepaid Bill-To Party
The
business partner that is billed for the first

part of the transport, according to the agreed
incoterms
Prepaid bill-to party is not necessarily the prepaid
payer

Collect Bill-To Party
The
business partner that is billed for the last

part of the transport, according to the agreed
incoterms
Collect bill-to party is not necessarily the payer

Prepaid Payer
The
business partner that pays for the first part

of the transport, according to the agreed
incoterms
Prepaid payer may not necessarily be the prepaid
bill-to party

Collect Payer
The
business partner that pays for the last part

of the transport, according to the agreed
incoterms
Collect payer may not necessarily be the collect billto party

Incoterm Handling General Data Tab (Step 1)

Incoterm Handling Business Partner Tab (Step 2)
Credit Limit Check
Credit Limit Check from worklist

Incoterm Handling Stages Tab (Step 3)

Shortcut Processes
New
shortcut process introduced from the

Forwarding Order Stages UI
In TM8.0, the ability to create/select Air/Ocean Booking
was at the header level of the business document
(Follow-Up->Create/Select Ocean Booking)
In TM8.1, the functionality has been moved to the
Stage view of the forwarding order
Select/Create freight bookings for the main carriage stages
of the Actual Route

Creation of Freight Orders for specific stages (pre-carriage
and on-carriage stages)
The kind of stage is determined by user defined Stage Type
which is associated to Stage Category

Enhanced Stage UI

Enhanced Stage UI
The
Stage UI was enhanced in such a way that it

is possible to also edit the Actual Route
Possibility to modify data of existing stages, creating
new stages and delete existing stages
New fields added to Stage Header and Stage UI
Port of Loading
Port of Discharge
Source CFS
Destination CFS
Vessel ID
Voyage etc.

Organizational Unit Interaction
Concept
introduced to allow the user specify

the responsible organization for further
processing of the stage
Field Planning and Execution Organization
capture the responsible organizational unit
to

Organizational Unit Interaction
Summary
You
should now be able to
Outline the Business Purpose and

Requirements
Define the Business Process
List the Solution Details
Business Example
John is a customer representative / supervisor working at a

freight forwarder (Logistics Service Provider) organization and
receives transportation requests from multiple customers &
shippers. He needs to record and process the requests as
Forwarding Orders in the Transportation Management system
Agenda
Configuration Steps
Process Flow

Scenario Overview
Freight Forwarders
Gateway (CFS)
(Yokohama, Japan)
Station
of Origin
Pickups
Shippers (OtaKu, Gifu,

Japan)
LineHaul /
Feeder
Port-ofLoading
(Yokohama
Japan)
Forwarding
House Station
(Nagoya, Tokyo)
Freight
Forwarders
Gateway (CFS)
(Los Angeles, USA)
Station
of Destination
Port-ofDestination
(Long Beach
USA)
LineHaul /
Feeder
Deliveries
Forwarding House
Station
(San Diego, Phoenix)
Consignee
s
(Sedona,Tus
con, USA)

Create Company Export Business Unit
Company represent the

top hierarchy or
business unit of the
organizational model
Need to maintain the

organizational model in
TM
Assign Forwarding House

to Companies
NWBC-Master DataOrganization-Create
Organization and Staffing

Create Company Import Business Unit
Company represent the

top hierarchy or
business unit of the
organizational model
Need to maintain the

organizational model in
TM
Assign Forwarding House

to Companies

Create Forwarding Houses Export Business Unit
Forwarding Houses
represent the
individual stations or
business units of LSP
Each forwarding
house acts as a
sales, purchasing,
and transport
planning/execution
unit

Create Forwarding Houses Import
Business Unit
Forwarding Houses
represent the individual
stations or business
units of LSP
Each forwarding house

acts as a sales,
purchasing, and
transport
planning/execution unit

Assign Positions and Users to Forwarding
Houses
Assign Employees to
Organizational Units
Each forwarding
house has its own
representative user
with a one-to-one
relationship with the
forwarding house
Maintain one user for

each Forwarding
House

Define Package Type Codes
Allows for
standardization of
packages used to
transport cargo
SPRO-SAP TM-TMBasic Functions-Type

Codes and Role
Codes-Master Data
Related Type Codes
and Role CodesDefine Package Type
Codes

Define Item Types
Define specific
measures for example
height, width, volume
and weight of a
transportable item
category
SPRO-SAP TM-TMForwarding Order

Management-Define
Item Types for
Forwarding Order
Management

Define Stage Types
Specify whether the

stage is main
carriage, pre-carriage
or on-carriage

Codes and Role
Codes-General Type
Codes and Role
Codes-Define Stage
Types

Define Default Agreement Party Roles for Stages
Define Agreement
Party role type (Prepaid / Collect) for
Incoterm and Stage
type combination

Management-Define
Agreement Party
Roles for Stages

Define Transportation Mode
Specify how cargo is

transported, for
example, by road, rail,
sea or air
SPRO-SAP TM-TMMaster DataTransportation

NetworkTransportation LaneDefine
Transportation Mode

Define Allowed Transportation Modes for Stage Types
Assign transportation
modes to stage type
Define which
transportation
modes can be used
for a stage of this
type
SPRO-SAP TM-TMBasic
Functions-Type Codes
and Role CodesGeneral Type Codes
and Role CodesDefine Allowed
Transportation Modes
for Stage Types

Define Movement Types
Movement types
predefine stages in
the forwarding order

Codes and Role
Codes-General Type
Codes and Role
Codes-Define
Movement Types

Define Stage Type Sequence for Movement Type
Movement types
predefine stages in
the forwarding order.
Define stage types

that should be
associated to the
forwarding order
when using the
corresponding
movement type

Codes and Role
Codes-General Type
Codes and Role
Codes-Define Stage
Type Sequence for
Movement Types

Define Forwarding Order Types
Define parameters of
that influence how the
system processes the
business document

ManagementForwarding OrderDefine Forwarding
Order Types

Define Forwarding Order Types
Define parameters of
that influence how the
system processes the
business document

ManagementForwarding OrderDefine Forwarding
Order Types
SAP TM 8.1
Freight Unit Building Rule
Freight unit Building Rule:
Transportation
Transportation
Requirement
Requirement
Used for automatic

creation of a freight unit
based on one or more
transportation requirement
Freight Unit Building can
use the following
Consolidation strategies:
Per item
Per request
As much as possible
FU type determination
using default value or
Condition
Several Split quantities in

different UoM possible
Freight
Freight Unit
Unit Builder
Builder
Freight
Freight Unit
Unit
Freight
Freight Unit
Unit
Freight
Freight Unit
Unit
Freight Unit Type
Freight unit type:
Flexible
customization options
Change Controller
Checks for Creation /

Save / Deletion
Execution Tracking
settings
Org.-Unit
Determination
Direct Shipment
Process
Default values
Pick-up / Delivery
Window calculation

Assign Item Types to Forwarding Order Types
Assign Item Type to

Forwarding Order
Type
With this, the item

type is usable in any
forwarding order of
the respective type

ManagementForwarding OrderAssign Item Types to
Forwarding Order
Types

Define Default Freight Document Types for Stages
Specify which freight

document type
(Freight Order Type /
Freight Booking Type)
is used for generating
business documents
through shortcut
process in forwarding
order

ManagementForwarding OrderDefine Default
Freight Document
Types for Stages

Assign Roles to User
Assign standard roles

to user
Roles are used to

choose a menu and
create the
corresponding
authorization profile.
After this roles can

be assigned to users
Agenda
Configuration
Process
Flow
Steps

Process Steps
Manage
Freight
Bookings for
Export
Manage
Forwarding
Orders
Execute &
Monitor Freight
for Export
Plan
Drayage to
Container
Terminal
Execute
Drayage to
Container
Terminal
Container
Arrival at Port
of Destination
Create PickUp
Loading of
Freight for
Main Stage
Plan Freight
For Export
Stages
Send Shipping
Instructions for
Main Stage
Generate Main
Stage Shipping
Documents
Forwarding
Settlement
to Shipper
Freight
Settlement

Step 1 Manage Freight Bookings for Export

Step 2 Manage Forwarding Orders

Step 3 Select Schedule for Main Carriage Stage

Step 3a View and Select Proposals

Step 3b Pre-Carriage/On-Carriage stages added to Forwarding Order

Step 3c Main Carriage Stage Details

Step 4 Main Carriage Schedule Confirmation by Gateway (CFS)

Step 4a Main Carriage Org Interaction Status set to Confirmed

Step 5 Assign Freight Booking to Main Carriage Stage

Step 5a View and Select Freight Booking

Step 5b Main Carriage Stage Planned

Step 6 Create Freight Order for Pick-Up

Step 6a Pick-Up Stage Planned

Step 6b View Pick-Up Freight Order
Summary
You
should now be able to
Explain the Configuration steps

Explain the Process Details

4 Forwarding Order Management

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TRAINING

At the end of this module, you will be able to:

Purpose and Requirements

TM8.1 Forwarding Order

on the business processes of freight

foundation of a forwarding order management for freight

TM8.1 Forwarding Order

8.1 focuses now on the business processes

Purpose and Requirements

TM8.1 Forwarding Order

Shippers (OtaKu, Gifu,

TM8.1 Forwarding Order

TM8.1 Forwarding Order

Order is an order from an ordering

TM8.1 Forwarding Quotation

Create quotation with

Place Order with

Convert quotation into

TM8.1 Forwarding Order

Purpose and Requirements

TM8.1 Forwarding Order

attributes are introduced in TM8.1 to

TM8.1 Forwarding Order

Mode specifies how cargo is to

and specifies the transportation mode of the main

TM8.1 Forwarding Order

Direction specifies whether the transport

The traffic direction if maintained in the business

TM8.1 Forwarding Order

Type specifies the way how the

TM8.1 Forwarding Order

Type specifies for which stages the

TM8.1 Forwarding Order

TM8.1 Forwarding Order

TM8.1 Forwarding Order

TM8.1 Forwarding Order

TM8.1 Forwarding Order

TM8.1 Forwarding Order

incoterms (such as EXW, FOB) are an

TM8.1 Forwarding Order

dimensions of the overall cost settlement process

Defined by the Incoterms and Organizational Unit that has the

In an export-import scenario and incoterm FOB, the export

TM8.1 Forwarding Order

requirement is to identify which parts

goods are moving away

Collect refers to the business partners to whom the

goods are moving to

Defines, whether the stage has to be settled prepaid,

collect, or not at all

TM8.1 Forwarding Order

business partner with whom a forwarding

calculate the charges in the invoice for the seller

TM8.1 Forwarding Order

business partner with whom a freight

system uses the collect agreement party to

TM8.1 Forwarding Order

business partner that is billed for the first

TM8.1 Forwarding Order

business partner that is billed for the last

TM8.1 Forwarding Order

business partner that pays for the first part

TM8.1 Forwarding Order

business partner that pays for the last part