Organizational Levels in the Procurement Process

Client

Company Code

Plant

Storage Location

Purchasing Organization/
Purchasing Group

 SAP AG 1999
Client

 The client is a commercial, organizational unit within

the R/3 System, with its own data, master records, and
set of tables.
 From a business perspective, the client forms a
corporate group.

 SAP AG 1999
Company Code

 The company code is the smallest organizational unit

for which you can have an independent Accounting
department within external Accounting.
 A company code represents an independent
accounting unit, for example, a company within a
corporate group (client).

 SAP AG 1999
Plant

 A plant is an organizational logistics unit that

structures the enterprise from the perspective of
production, procurement, plant maintenance, and
materials planning.
 A plant is a manufacturing facility or branch within a
company.

 SAP AG 1999
Storage Location

 The storage location is an organizational unit that

allows the differentiation of material stocks within a
plant.
 Inventory Management on a quantity basis is carried
out at storage location level in the plant.
 Physical inventory is carried out at storage location
level.

 SAP AG 1999
Organizational Levels in Inventory Management

Client 400

Company code Company code

0001 0002

Plant 1000 Plant 1100 Plant 2000

SLoc SLoc Lagerort

SLoc SLoc SLoc
0001 0002 002
0001 0002 0003

 SAP AG 1999
Valuation Area

Valuation area

Company code Plant

3000
............ ............

........ ........
........

 SAP AG 1999
Purchasing Organization / Group

Purchasing
organization

 A purchasing organization is an organizational level

that negotiates conditions of purchase with vendors for
one or more plants. It is legally responsible for completing
purchasing contracts.
 A purchasing group is the key for a buyer or group of
buyers responsible for certain purchasing activities.

 SAP AG 1999
Plant-Specific Purchasing Organization

Purchasing Purchasing Company code

organization 1 organization 2

Plant 1 Plant 2

 SAP AG 1999
Cross-Plant Purchasing Organization

Purchasing
organization
Company code

Plant 1 Plant 2

 SAP AG 1999
Cross-Company-Code Purchasing Organization

Purchasing
organization

Plant 1 Plant 2 Plant 3

Company code 1 Company code 2 Company code 3

 SAP AG 1999
Procurement Cycle

Purch. req.

8 Payment processing 1 Determination of reqmts

Invoice
Purch. ord.

? 10
20
30
2 Source determination
7 Invoice verification Procurement

6 Goods receipt
Purchase 3 Vendor selection
order
10
20
30

5 PO monitoring 4 PO processing

 SAP AG 1999
Purchase Requisitions

Purchasing RFQ

Purchase Outline
Manual requisition agreement

MRP

Purchase
order
Master data

 SAP AG 1999
RFQ / Quotation

Purchase
Purchasing order

Vendor A
Purchase RFQ Quotation
requisition
Source
of Vendor B
supply

Vendor C
Rejection
letter

Master data

 SAP AG 1999
Purchase Order

Purchasing

Purchase Vendor
requisition
Purchase
order

RFQ
Other plant

Master data

 SAP AG 1999
Goods Receipt

Ext. vendor or
other plant

GR
GRarea
area
Purchase
order

Material Accounting
document document(s)

 SAP AG 1999
Invoice Processing

Master data

Invoice verification Invoice

document
Payment
Invoice
program

Purchase Mat. doc. for

order goods receipt

 SAP AG 1999
Order Processing

Requisition
8 Payment
Requirement determination
Purch.order 1
Vendor
invoice 10
? 20
30

7 Invoice Verification

2 Source determination

Procurement

6 Goods receipt
3 Vendor selection

Purch.order
10
10
20
20
30
30

5 Purchase order monitoring 4 Order processing

 SAP AG 1999
Purchase Order

Manual

PO history for item 20:

Quotation Purchase order

Goods receipt:
10 ............................
20 ...10 pcs of SL-01 Jan. 21.98 5 PCs ...
30 ............................
Jan. 23.98 3 PCs ...
Purchase Jan. 27.98 2 PCs ...
requisition
...

...

... Invoice receipt:

Jan. 30.98 10 pcs ...

Reference

 SAP AG 1999
Purchase Order Format

Header data

Purchase order
 Document number  Vendor
 Payment conditions  Currency
 Purchase order date  ...
10 .....................
20 .....................
Item: 10
30 .....................
Item: 20
Item: 30

 Material number  Delivery date

 Short text  PO price
 Order quantity  ...

 SAP AG 1999
Table Control

Item I A Material Short Text Qty. reques

10
20
30
40

Item Qty. reques Material Short Text I A

10
20
30
40

 SAP AG 1999
 Configuration by Table Control

Item Qty. reques Material Short Text I A

 Change the order 10
of columns 20
30
40

Item Qty. reques Material Short Text I A

 Change the size 10
of a column 20
30
40

 Save the configuration

 for the transaction
 as standard
 SAP AG 1999
Item Category

Item Categories
Standard
Purchase
requisition B Limit

RFQ K Consignment
L Subcontracting
M Material unknown
S Third-party
Purchase
order
T Text
Outline
agreement
U Stock transfer
W Material group
D Services

 SAP AG 1999
Issuing Messages

Purchasing doc.

Output
Printer EDI Fax
E-mail Telex
Teletex

Printout Delivery Expeditor/ Rejection Order

schedule Reminder letter acknmt
expeditor

 SAP AG 1999
Goods Receipt

Requisition
8 Payment
Requirement determination
Purch.order 1
Vendor
invoice 10
? 20
30

7 Invoice Verification

2 Source determination

Procurement

6 Goods receipt
3 Vendor selection

Purch.order
10
10
20
20
30
30

5 Purchase order monitoring 4 Order processing

 SAP AG 1999
Goods Receipt for Stock Material

Purchase
order

Item:
1
2
3

Goods receipt
Warehouse

Vendor

GR
slip
Printout 1 ______
(optional) 2 ______
3 ______

 SAP AG 1999
Movement Type: Examples

101

Goods receipt to the warehouse

122

Return delivery to the vendor

 SAP AG 1999
Invoice Verification

Requisition
8 Payment
Requirement determination
Purch.order 1
Vendor
invoice 10
? 20
30

7 Invoice Verification

2 Source determination

Procurement

6 Goods receipt
3 Vendor selection

Purch.order
10
10
20
20
30
30

5 Purchase order monitoring 4 Order processing

 SAP AG 1999
Information in an Invoice

T
S
SS
Theil
Theil&&Söhne
Söhne
Martinsplatz
Martinsplatz39
39 Vendor
60049
60049Frankfurt
Frankfurt
IIDES
IIDESAG
AG
Überseering
Überseering110
110
22045
22045Hamburg
Hamburg April
April7,
7,1999
1999 Document date
Purchase order With
Withreference
March
referenceto
toyour
yourpurchase
purchaseorder
order45000895
45000895from
from
March 3, 1999, we delivered the followinggoods:
3, 1999, we delivered the following goods:

10VGE-roh
10VGE-roh 11 1,000
1,000pcs
pcs UNI
UNI 2,500
2,500
Invoice items VGE-hal
VGE-hal11 300
300kg
kg UNI
UNI 1,500
1,500 Amount per item
UNI
UNI4,000
4,000

Material plus
plus10%
10%tax
tax UNI
UNI 400
400
Tax amount

Quantity
UNI
UNI4,400
4,400 Invoice amount

Unit of measure Tax rate

Payable
Payablewithin
within20
20days
daysofofinvoice
invoicedate.
date.
2%
2%cash
cashdiscount
discountfor
forpayment
paymentwithin
within10
10days.
days.
Payment conditions Acct
Acct no. 11223344, MBS Bank (code 300210
no. 11223344, MBS Bank (code 300 21055).
55).
Bank information

 SAP AG 1999
Invoice Verification with Reference to PO

Purchase
Purchaseorder
ordernumber
number
Invoice
Purch.ord.

Item:
Item: 1 __________
1 __________ D
Delivery
eliverynote
notenumber
number 2 __________
2 __________
3 __________ ?
3 __________

B
Bill
illof
oflading
ladingnumber
number

 SAP AG 1999
Reference to Purchase Order

Purch. ord. Purchase order

no. 4500012345
100 pcs

GR-IV

Goods receipt Goods receipt Goods receipt

GR 1 50 GR 2 40 GR 3 10

Incoming
invoice Access via Selection screen
purchase order
Purch.
Purch. ord.
ord.

X 4500012345 100

 SAP AG 1999