MMtest

Agenda
Name of the
section
SAP overview
Duration (hours)
6 Hrs
Objective
To understand what is SAP and its various applications.
Pre-requisites
Knowledge on ERP Solution
Course Content
SAP Overview
Industry Solutions from SAP
Main Modules of SAP
SAP Overview
SAP stands for Systems, Applications and Products in

data processing".
SAP is the worlds third-largest independent software

provider.
SAP was founded by 5 former IBM employees in 1972

and head quartered in Walldorf,Germany.
SAP is the global market leader in ERP and in

collaborative and inter-enterprise business solutions
2
SAP overview
Various SAP Business suite :
mySAP Enterprise resource planning
mySAP Supply chain management
mySAP Customer relationship management
mySAP Product life cycle management
mySAP Supplier relationship management
SAP overview Industry solutions from SAP

Aerospace & Defense
Automotive
Banking
Defense & Security
Engineering, Construction &

Operations
High Tech
Healthcare
Higher Education & Research
Industrial Machinery
Chemicals
Consumer Products
Life Sciences
Higher Education & Research
Industrial Machinery &

Components
Life Sciences
Logistics Service Providers
Media
Mill Products
Health Care
High Tech
SAP overview Industry solutions from SAP (..Contd)

Mining
Oil & Gas
Postal Services
Professional Services
Public Sector
Railways
Retail
Telecommunications
Utilities
Wholesale Distribution
SAP-Overview
Small and medium business solutions

mySAP all-in-one
SAP business one
New dimension products

Strategic enterprise management
Advanced planer and optimizer
Enterprise buyer profession edition
Business information warehouse
mySAP technology
SAP Net weaver
6
SAP-Overview
SAP R/3 main modules are
Financial Accounting (FI)

Controlling (CO)
Materials Management (MM)
Sales & distribution (SD)
Production Planning and Execution - Discrete,
Repetitive, Process (PP)
Logistics execution (LE)
Quality Management (QM)
Project Systems (PS)
Plant Maintenance (PM)
Customer Service (CS)
Human Resources (HR)
7
SAP Application Modules

SAP has several layers. The Basis System is the heart of
the data operations and should be not evident to higher
level or managerial users. Other customizing and
implementation tools exist also. The heart of the system
from a managers viewpoint are the application modules.
Course Begins
Curriculum
1. Introduction to Procurement
2. Organization Structure
3. Master Data
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Material Master
Vendor Master
Customizing settings for master data
Purchasing
Inventory Management
Invoice Verification
Account Determination
Batch Management
Physical Inventory
Consumption Based Planning
Standard Reports in MM
Standard Tables in MM
10
Agenda
Name of the
section
Introduction to procurement
Duration (hours)
1 Hrs
Objective
To understand the various organizational structures from

legal and business transaction point of view.
Pre-requisites
Functional experience in Procurement.

Understanding of Organizational structure.
Course Content
Introduction to procurement
Internal Procurement
External procurement
Methods of procurement
11
Introduction To Procurement
Definition
The process of obtaining services, supplies, and equipment
from a vendor is called Procurement.
The procurement department or the purchase department
within an organization manages all the purchases.
12
Organizational levels in a procurement cycle
Client
A client can be termed as a corporate group
Company
Code
A company code is a company (accounting

unit) within the corporate group (client)
Plant
Storage
Location
Pur Org
A plant is the manufacturing facility or branch

within the company
Storage location is a area in the plant where all
the materials procured for the plant gets stored.
Inventory management and physical inventory
is carried out at the storage location level
The Procurement activity is taken care by this
department in the plant
Note:- A plant can be one of the following # Central delivery # warehouse #Regional
sales office #Manufacturing facility # Corporate headquarters
13
Types of Procurement
External Procurement
14
In a company, goods movements do not only occur in the form of goods receipts and
goods issues. Depending on the organization of the company and its sales policy, internal
stock transfers may also be necessary.
Stock transfer with delivery is a plant-to-plant scenario. You are posting a goods issue in
plant A and a goods receipt in plant B. This type of stock transfer can only be carried out
from unrestricted-use stock of the issuing plant to unrestricted-use stock of the receiving
plant. In a second step, you post the placement into storage at the receiving plant. Only
then is the event complete and the transferred quantity part of unrestricted-use stock.
The following are a must for internal procurement between plant to plant within the same
company code.
Creating a stock transport order in plant B
Generating a delivery in plant A
Picking the material in plant A
Posting the goods issue in the delivering plant i.e. Plant A
Posting the goods receipt in the receiving plant i.e. Plant B
The quantity posted from stock is first of all managed as stock in transit for the receiving
plant. The quantity is only posted to the unrestricted-use stock of the receiving plant once
the goods receipt has been posted. This enables the quantity 'on the road' to be
monitored.
15
You post a stock transfer from company code to company code in the same way that you
post a stock transfer from plant to plant, except that both plants belong to different
company codes.
During the stock transfer, two accounting documents are created in addition to the
material document
An accounting document for the removal from storage at the issuing company code
An accounting document for the placement into storage at the receiving company code
The following are a must for internal procurement between plant to plant between 2
different company codes.
Creating a purchase order at the receiving plant
Creating delivery and billing documents at the issuing plant
Posting the goods receipt at the receiving plant
Posting the invoice receipt at the receiving plant
The key points in this kind of procurement is
The issuing plant enters a delivery for the stock transport order and a billing document.
This is an inter company billing document. Pricing takes place as normal.
When the goods arrive, the receiving plant posts a goods receipt for the purchase order.
The unrestricted-use stock increases and an accounting document get created.
The invoice is checked with reference to the purchase order.
16
General cycle of activities:
Payment
Invoice
Verification
Goods
Receipt
PO Monitoring
Determinatio
n of
requirement
Selection of
vendors from
the vendor
database
Procurement
Vendor Selection
and Comparison
of Quotations
PO processing
17
1. Determination
of Requirements
Materials requirements are identified either in the user departments or via materials planning
and control & passed on to the Purchasing department via a Purchase requisitions. You can
enter purchase requisitions yourself, or they can be generated automatically by the materials
planning and control system.
2. Source Determination
The Purchasing component helps you identify potential sources of supply based on old orders
and existing longer-term agreements with the vendor. This speeds the process of creating
requests for quotation (RFQs), which can be sent to vendors.
3. Vendor
Selection and Comparison of Quotations
The system is capable of simulating pricing scenarios, allowing you to compare a number of
different quotations. Rejection letters can be sent automatically.
4. Purchase Order Processing

The Purchasing system takes up input datas from the requisition and the quotation to help you
create a purchase order. As with purchase requisitions, you can generate Pos yourself or have
the system generate them automatically.
18
5. Purchase
Order Monitoring
The buyer can check the status of the PO i.e. if the goods or invoices have been received
for a particular PO. The system checks the reminder periods you have specified and - if
necessary -automatically prints reminders or expediters at the predefined intervals.
6.
Goods Receipt
Goods receiving personnel can confirm the receipt of goods simply by entering the PO
number. By specifying permissible tolerances, buyers can limit over- and under deliveries
of ordered goods.
7. Invoice
Verification
Vendor invoices are checked for accuracy of prices and contents.

8.
Payment Processing
Based on the invoice verification, the Accounts Dept / Finance Dept normally deals with
vendor payments.
19
Methods of Procurement
Procurement for Stock

A stock material is a material that is kept in stock. These materials are kept in stock once
received from the vendor. The stock of this materials keeps on increasing or decreasing
based on amount of the quantity received or issued.
To order a material for stock, the material must have a master record.
Procurement for Direct Consumption

When you procure for direct consumption, you specify the consumption purpose by
entering an account assignment (for example, a cost center).
To order a material for consumption, the material may have a master record.
20
Methods of Procurement
There are 3 basic forms of external procurement supported by MM

Purchasing component.
One-time purchase orders
Longer-term contracts with the subsequent issue of release orders
Longer-term scheduling agreements and delivery schedules
21
Forms of Procurement
One-Time Purchase Order

You use one-time orders for materials or services that you order irregularly.
You can reference a purchase requisition, RFQ, or another PO when creating a one-time
order.
Contract and Release Orders

For materials that are being ordered regularly and in large quantities, we can negotiate a
deal with the vendor for pricing or conditions & record then in a contract.
In a contract you also specify the validity date.
Scheduling Agreement
If a material is ordered on a regular basis and is to be delivered according to an exact time
schedule, then you set up a scheduling agreement. This method of procurement is
typically used when Just-in-Time deliveries are required from the vendor (for example, in
the automobile industry).
22
Curriculum
3. Master Data
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Material Master
Vendor Master
Purchasing
Batch Management
Physical Inventory
23
MM Enterprise Structure
Client
Company
Plant
Purchasing
Org.
24
Client
Is the Highest Legal Entity

An Independent Unit in R/3 System
25
Company
An Independent accounting unit within the client.
Each has its own P&L account and Balance Sheet
26
Plant
A unit under the company
All Operation of the company take place here (e.g. Manufacturing, sales, storage
Unit, Admin Building)
27
Storage Location
The storage location is an organizational unit that allows the differentiation of
material stocks with in a plant.
Physical Inventory is carried out at storage location level.
28
Purchasing Organization
Responsible Organizational Unit for Procuring material / Service

Procure the Material / Service for one or more plants within the company
29
Purchasing Groups
The groups which are responsible for day to day buying activity in the
Purchasing organization
30
CLIENT
ASPL
ASPL
COMPANY
PLANT
STORAGE
LOCATION
MM Enterprise Structure
BDC
BDC
PURA
PURA
PURCHASE
ORGANIZATION
MDC
MDC
REF PURCHASE
ORGANIZATION
BDC1
BDC1
Bay11
Bay11
BDC2
BDC2
Bay12
Bay12
Bay21
Bay21
PURB
PURB
MDC1
MDC1
Bay22
Bay22
Bay31
Bay31
MDC2
MDC2
Bay32
Bay32
Bay41
Bay41
Bay42
Bay42
PURM
PURM
31
Configuration Enterprise Structure
Define here
Assign here
32
Defining Organizational Elements

Client :
SPRO > IMG > Enterprise Structure > Definition > Financial Accounting >
Define Company > New Entries
Company Code :
SPRO > IMG > Enterprise Structure > Definition > Financial Accounting > Edit,
Copy, Delete, Check Company Code > Copy, Delete, Check Company Code
Controlling Area :
SPRO > IMG > Enterprise Structure > Definition > Controlling > Maintain
Controlling Area > Maintain Controlling Area
Use Currency type : 10 & Chart of Accounts as : INT
33
Defining Organizational Elements

Plant :
SPRO > IMG > Enterprise Structure > Definition > Logistics General > Define ,
copy, delete , check plant > copy, delete , check plant
Storage Location :
SPRO > IMG > Enterprise Structure > Definition > Materials Management >
Maintain Storage Loc ( w.r.t plant ) > New Entries
Purchase Organization :
SPRO > IMG > Enterprise Structure > Definition > Materials Management >
Maintain Pur. Org >New Entries.
34
Assigning Enterprise Structure
SPRO > IMG > Enterprise Structure > Assignment > Financial Accounting > Assign
Company Code to Company.
SPRO > IMG > Enterprise Structure > Assignment > Controlling> Assign Company
Code to Controlling area
SPRO > IMG > Enterprise Structure > Assignment > logistics General > Assign
Plant to Company Code
SPRO > IMG > Enterprise Structure > Assignment > Materials Mgmt > Assign P.Org
to Co . Code
to Plant
SPRO > IMG > Enterprise Structure > Assignment > Materials Mgmt > Assign
Standard P.Org to Plant
to Reference P.Org
35
Activate Company code for Materials Mgmt

SPRO > IMG > Logistics General > Material Master > Basic Settings >Maintain
Co.Code for Materials Mgmt
36
Curriculum
3. Master Data
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Material Master
Vendor Master
Purchasing
Batch Management
Physical Inventory
37
Agenda
Material master
Material master contains the information on all the

materials that a company procures or produces, stores or
sells
Duration (Hours)
Objective
To get familiar with Material Master
Pre-requisites
Material Master
Course content
Introduction
Material Master
Demo1_ Creation of Material master
Demo2_Customization settings
Note Fields in red boxes are mandatory fields.
38
Introduction
What is Material Master ?

How the Material master is used in all the departments ?
How it is useful in creating PO ?
39
Material Master
Material master contains the information on all the materials that a company procures or
produces, stores or sells. The material master record is a companies main source of
material specific data. It is used by all components in the R/3 logistics system.
Material Master Data

Basic data
Purchasing
Materials planning
S&D
Stocks in Plant/ stor

Loc
Accounting
Material
Master
Record
Work scheduling
Quality management
Storage
Forecasting
Warehouse Mgmt
Classification
40
Material Master
Integration of all material data in a single database , prevents the problem of

data redundancy. Data contained in material master record is required for many
functions with in the R/3 logistics system, for example:
Purchasing data for ordering
Inventory management data for posting a goods movements and
managing physical inventory.
Accounting data for material valuation.
MRP data for material requirements planning.
Each department in company has its own view in material master

Some material is valid for all organization levels, while some is valid only for
certain levels.
Data at client level
Data at plant level
Data at storage location level
41
Material Master
Maintain a material master record: screens
Material
(Industry sector)
(Material type)
Selective views
- Basic Data
- Purchasing
- Accounting
Organizational
levels
- Plant
-Storage location
-..
Data screens
When creating or editing a material master data, you go through a number of

screens.
From initial screen you go to two successive dialogue boxes . In the first
dialogue box, you specify the view you want to process. In second you specify
the relevant organizational levels. You then go to the data screens.
You can change the standard screen sequence by changing the default values
42
Material type
Materials with the same basic attributes are grouped together and assigned to a
material type. This allows you to manage different materials in a uniform
manner in accordance with your company's requirements. Examples of material
types are given in the graphic below
Material type
Number assignment
Raw
materials
Procurement type
Control
Semi finished
User departments
Field selection
Account determination
Finished products
..............
43
Industry sector
Industry sector
Selection
Screen
Raw materials
Control
Field selection
Operating
suppliers
Like material type, the industry sector has a control function in SAP R/3
When you create a material master record, the industry sector defines.
which screens are displayed and in which order
which industry specific fields are displayed in each screen
Industry sector you assigned to material cannot be changed latter.
In customizing , you can define new industry sectors and maintain field
reference for field selection control according to your company- specific
requirements.
44
Material Type
Material type controls :
The type of number assignment (internal or external).
The permitted number range interval.
Which screens are displayed and in which order.
Which user-department-specific data (view) is suggested for entry.
Which procurement type is permitted for a material; that is, whether the material
is produced in-house, procured externally, or whether both options are allowed.
Along with the plant, the material type determines a material's inventory
management requirement; that is, whether the system updates quantity
changes in the material master record or updates changes in value in the stock
accounts in Financial Accounting.
The material type also determines which accounts are posted when a material
is posted to stock or leaves the warehouse.
Various material types are provided in the standard SAP R/3 System. If your
company needs additional material types, you can define these in Customizing
according to your requirements
45
Unit of measure
In addition to the base unit of measure the system uses for

stock keeping unit and to execute all its calculations, other
departments use their own unit of measure. For example
Purchasing can use another unit of measure to sales and
distribution or to the warehouse.
Base unit of measure: stock keeping unit. All the other unit
of measure that you use, are converted to base unit of
measure. You must enter the conversion factor for the unit
of measure in the material master.
46
Purchasing data in material master record

In the Purchasing view of the material master
Source list requirement
Quota Arrangement usage
Automatic PO
Other additional details as might be needed based on specific
functionality as currency, etc
47
Valuation class
Valuation class
Material type
Valuation class 1
Accounting 1
Valuation class
300000
Valuation class 2
300100
Material
Master
You can use the valuation class to Combine the materials for assigning G/L
accounts so that you do not have to manage a separate stock account for each
material.
You maintain the valuation class in accounting view of the material master
record. The valuation class allowed for a material depends on the material type
and can be configured in customizing.
48
Material Valuation procedures
Material valuation
Price control
( In material master )
S
Standard price
V
Moving average
price
49
Price Control
Valuation of goods receipts depends on the price control procedure you set in the material
master record. In the R/3 System, material valuation can be carried out according to the
moving average price procedure (V price) or the standard price procedure (S price).
In the standard price procedure (price control S), the system carries out all stock
postings at a price defined in the material master. Variances are posted to price difference
account
In the moving average price procedure (price control V), the system valuates goods
receipts with the purchase order price and goods issues with the current moving average
price. The system automatically calculates the latter upon every goods movement by
dividing the total value by the total stock quantity. Differences between the purchase order
price and the invoice are posted directly to the relevant stock account if there is sufficient
stock coverage.
50
Demo1_Create Material Master

Objective
To create a Material Master
51

Objective
Selective views for creating material master
52

Objective
To maintain the data in Basic data1 view
53

Objective
To maintain the data in Purchasing view
54

Objective
To maintain the data in Accounting1 view
55
Demo2_Cutomizing settings
Objective
To create Purchasing group, purchasing Value keyetc
56
Important T Codes in Material Master
MM 01
MM02
MM03
MM 17
MMAM
MM11
MM50
Create Material Master

Change Material Master
Display Material Master
Mass Maintenance
Change Material Type
Schedule creation of Material Master
Extend the material view(s)
Once material masters are created from one plant same can be extended to other plants
using T- Code MM 01.
57
Curriculum
3. Master Data
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Material Master
Vendor Master
Purchasing
Batch Management
Physical Inventory
58
Agenda
Vendor Master
The vendor Master record contains all the information

about the vendor that is needed to be able to conduct
business with them.
Duration (hours)
Objective
To get familiar with Vendor master
Pre-requisites
N.A
Course content
Introduction
Concept
Important Data for Vendor Master.
Demo1_Customizing Settings
Demo 2_Creation,Change and display of vendor
master
59
Introduction
What is meant by vendor master ?
How is it useful in purchasing?
How is your organization maintaining this master record?
60
Concept
All the relevent data on vendors is managed in Vendor master records that is
specifically related to purchasing. It contains information about external
suppliers like vendors name and address as well as data such as :
- General data
- Accounting data
- Purchasing data
61
Account Group
When creating a vendor master record, you must specify an account group.
The account group determines :
The type of number assignment.
Whether or not a one time vendor is involved.
Which fields screens contain and whether entries in these fields are mandatory
or optional.
62
Partner Function
A vendor can take up different roles depending upon the

requirement.these roles are called Partner roles or partner
Function. some of the roles are given below:
Ordering address
Supplier of goods
Invoicing party
Payee
63
Define Account group

Define Number Ranges
Define the term of payment
Define the Partner function
Define the Partner schemas
64
Objective
To create an account group
65
Objective
To create an account group
66
Objective To create an account group
67
Objective To create an account group
68
Objective
To define Number Ranges
69
Objective
Assign vendor Account group to number ranges.
70
Objective
To Define Terms of payment
71
Objective
Define Partner function
72
Objective
Define partner determination procedure for schema.
73
Objective
Define partner function in schema.
74
Demo2_Creation of vendor master

Objective
To create a new vendor
75
Demo2_Change of vendor master

Objective
To change a Vendor master.
76
Demo2_Display of vendor master

Objective
To display a master record.
77
Curriculum
3. Master Data
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Material Master
Vendor Master
Purchasing
Batch Management
Physical Inventory
78
Customizing settings for material master

Customizing settings
for material master
Customizing the Material Master, according to our

business requirement.
Duration (Hours)
Objective
To get familiar with customizing settings with material

master
Pre-requisites
Material Master
Course content
Introduction
Concept
Demo1_ Customizing settings for Material Master
79
Introduction
What is customizing settings for material master ?
How is it useful for end users ?
How does it satisfy companys own business requirement ?
80
Concept
Customizing settings for material master, we can customize fields

according to the business requirements. Most cases standard SAP
providing is enough, but some case you need to customize( i.e your
own industry sector, material type, no ranges.. ).
We can restrict the material number length
When ever you are creating a Material , if u select you select your own
material type and industry sector, it will display the selective views
required views for our material( i.e., what we have customized )
81
Demo1_Cutomizing settings for Material

Master
Objective
Material number length Material
82

Master
Objective
To create Industry sector
83

Master
Objective
To create Material type
84

Master
Objective
To maintain a number ranges
85

Master
Objective
To copy the standard screen sequence to own
86

Master
Objective
To assign the screen sequences to material type and industry sector
87
Curriculum
3. Master Data
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Material Master
Vendor Master
Purchasing
Batch Management
Physical Inventory
88
Agenda
Purchase
requisition
This component use to give notification of

requirements of materials and/or external services
and keep track of such requirements.
Duration (Hours) 1
Objective
To get familiar with PR
Pre-requisites
Material Master, Vendor Master
Course content
Introduction
Concept
Demo2_Creation of PR
Change of PR

89
Introduction
Define Purchase Requisition
What are the procurement types exist?
90
Concept
A purchase requisition is a request to Purchasing to procure
a certain quantity of a material or a service so that it is
available at a certain point in time.
91
Purchase Requisition
Requisitions can be created
Directly
Indirectly
92
Purchase Requisition
PR contains number of Items, for each of which a
procurement type is defined.
Following procurement type are exist.
Standard
Subcontracting
Consignment
Stock Transfer
External Service
93
Concept
Changing a Purchase Requisition

If the requisition has already had a PO issued against it then it is required to
inform the purchasing group
If the requisition has been approved then changes are only possible to a
limited extent and may themselves be subject to approval
If the requisition was created by Materials Planning then you may not be
able to change the requisition or it is require to notify the materials planner
before making any changes.
94
Define Document Types
Define Screen Layout at Document Level
95
Objective
To create different document types for PR
96
Objective
To assign Number ranges to a document type
97
Objective
98
Demo2_ Create Purchase Requisition

Objective To create a Purchase Requisition
99
Agenda
Request For Quotation
This tool is used to manage and compare requests for

quotation (RFQ) issued to vendors and the quotations
submitted by the latter in response to them.
Duration (Hours)
Objective
To get familiar with RFQ/Quotation
Pre-requisites
Material Master, Vendor Master, Purchase Requisition
Course content
Introduction
Concept
Demo1_ Creation of RFQ
Demo2_Maintaining a Quotation and Price comparison
Demo3_Customization settings
100
Introduction
What is a quotation?
What is RFQ ?
What is the difference between the two?
What is the process of vendor selection in your organization?
101
Concept
Request For Quotation (RFQ) is an invite made to a vendor by purchasing

organization to submit a quotation for the supply of goods or service
performance.
A quotation is a reply by a vendor to a purchasing organization related to the

supply of goods or service performance subject to specified conditions.
Price Comparison is the process of comparing the prices for all the quotations
received from vendors.
102
Demo1_Creation of RFQ
Objective To create an RFQ
103
Objective To create a RFQ
104
105
106
Demo2_Maintaining the quotation

Objective
To maintain a quotation
107
Demo2_Maintaining the quotation

Objective
Price comparison of quotations
Vendor1 is ranked as 1st

(green highlight) and can
be selected for further
processing
108
Define Document Types
109
Objective To create different document types for RFQ
110
Objective To assign Number ranges to a document type
111
Objective Define Screen Layout at Document Level
112
Agenda
Source list
Source list specifies the possible sources of supply for a material

over a given period of time
Duration (hours) 1
Objective
To get familiar with Source list
Pre-requisites
Material master
Vendor master
Course content
Introduction
Demo 1_Source list

113
Introduction
What is meant by source list ?
How does your organization maintain this master record ?
Source list specifies the possible sources 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 a certain long-term purchase agreement.
Source list is used in the administration of source of supply.
Source list can be created manually or generated automatically.
Source list you can be copied from one plant to another plant
114
Demo1_Source list
Objective
Maintain a source list ME01
115
Demo1_Source list
Objective
Material Master settings for Source List
116
Demo1_Source list
Objective
Source list requirement at plant level
117
Agenda
Info record
Purchasing info record contains the concise information on a

vendor and the material( i.e., the vendors current price is stored
in the info record )
Duration (Hours) 1
Objective
To get familiar with info record
Pre-requisites
Material master
Vendor master
Course content
Introduction
Demo 1_inforecord
Demo 2_inforecord
Demo 3_inforecord
118
Introduction
What is meant by info record?
How is your organization maintaining this master record?
How is it useful in purchasing?
The purchasing info record ( Info record )contains the information on a

specific material and vendor supplying the material, For example, the
vendor's current pricing is stored in the info record.
Info records can be created at purchasing org / plant level or Purchasing

organization level.
119
Introduction
When you create a purchase order, the system searches for info record
for purchasing organization/plant combination. If there in no record for
this combination, the system searches for purchasing organization only.
You can maintain info record manually or automatically from quotations,

purchase orders or outline agreements.
Info record can be maintained for different procurement types
Standard
Subcontracting
Pipeline
Consignment
120
Demo 1_ Info record

Objective
To create an Info record Purchasing org / Plant level
121
Demo 1_ Info record

Objective To create an Info record Purchasing org / Plant level
122
Demo 1_ Info record

Objective To create an Info record Purchasing org / Plant level
123
Demo 2_ Info record

Objective
To create an Info record at Purchasing Organization level
124
Demo 2_ Info record

Objective
To create an Info record at Purchasing Organization level
125
Demo2 _ Info record

Objective
To Create an Info record at Purchasing Organization level
126
Demo3 _ Info record

Objective
Info Update in quotation
127
Demo3 _ Info record

Objective
Info Update in Purchase order
128
Demo3 _ Info record

Objective Info Update in contract ( Outline agreement )
129
Agenda
Purchase Order A purchase order is a formal request to a vendor to supply or
provide goods or services at a certain point of time with certain
quantity.
Duration
(Hours)
Objective
To get familiar with purchase order.
Pre-requisites
Material master, Vendor master
Course content
Concept
Important Data for Purchase order
Process Flow
Demo1_Purchase order Creation s
Demo2_Customization
130
Concept
It represents the formal and final confirmation to the vendor to supply

material or service.
Its an external document created with ref to PR / RFQ/PO/Outline

agreement by the Purchasing group as per the agreed terms & conditions.
131

Prerequisites required for maintaining purchase order are as follows.
Header data
Vendor
Order(doc.) type
Purchase organization
Purchase group
Company code
The terms of payment
Item data
Material no.
Plant no.
Quantity
Delivery date
Price
132
Item category
Item category controls the procurement process and defines whether an
item requires material number, account assignment, goods receipt, and/or
invoice receipt.
Standard Item categories

Standard
Subcontracting
Third Party
Consignment
Stock Transport Order
133
Account Assignment Category

It determines the nature of account assignment and accounts to be charged
when the incoming invoice or goods receipt is posted.
Standard Account assignment categories :
Asset
Order
Production Order
Cost Center
Project
Unknown
Sales order
134
Document type
The purchasing documents are differentiated via document type, also
determines which is the relevant number ranges and which field should be
offered during maintenance purposes.
135
Process flow
Purchase Order
With ref.to PR
With ref. to Outline Agree.
With ref.to RFQ
136
Demo1_Creating a Purchase Order

Objective
To create a Purchase Order
137
Define document type

Define number ranges
Define screen layout
Set tolerance limit for price variance
138
Objective
To Define the document type purchase order document.
Select the document

Type(NB)
139
Objective
To Define the number ranges for purchase order document.
140
Objective
To change the screen layout for Purchase Order
Select the field ME21

And double click.
141
Objective
To change the screen layout for Purchase Order
Marked the check box as

Per requirement
142
Objective
To change the tolerance settings
Click on radio button

As per requirement
And enter the
% also
143
Agenda
Outline Agreement
This component can be used to enter into longer-term

purchasing arrangements with vendors regarding the
supply of materials or the performance of services.
Duration (Hours)
Objective
To be familiar about Outline agreement
Pre-requisite
Vendor Master
Material Master
Purchase Order
Course content
Definition of Outline Agreement

Contracts
Scheduling Agreement
Demo1_Creation of Contracts
Demo2_Customizing Settings for Contracts
Demo3_Creation of scheduling agreements
144
Outline agreement
In the R/3 System, an outline agreement is a longer-term purchase
agreement concerning the supply of goods or the services performance
according to predetermined conditions. These are valid up to a certain
period of time and cover a predefined total purchase quantity or value.
In SAP outline agreements are again subdivided into the following
categories
Contracts
Scheduling agreements
145
Definition
Structure of an Outline Agreement

Document header: It contains information relating to the entire agreement.
For example, the vendor information and header conditions are in the
document header.
Items: It contains the information specific to the relevant material or service.
Quantity or price of the item
Conditions, such as quantity discounts and surcharges
146
Contracts
A contract is a type of Outline agreement between the company and the vendor
for a agreed material or service which can be issued as and when required
during a certain overall time frame.
There are two types of Contracts
Quantity contract
Value contract
147
Contract
You can also set up corporate buying contracts with your vendors.
Plant contract/Centrally agreed contract
Contract 1
Plant 1
Contract 2
Plant 2
Plant 3
Distributed contracts are centrally agreed contracts that are made available to
other R/3 Systems for the purpose of issuing release orders against them.
148

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Agenda

To understand what is SAP and its various applications.

Knowledge on ERP Solution

SAP stands for Systems, Applications and Products in

SAP is the worlds third-largest independent software

SAP was founded by 5 former IBM employees in 1972

SAP is the global market leader in ERP and in

SAP overview Industry solutions from SAP

Defense & Security

Engineering, Construction &

Higher Education & Research

Higher Education & Research

Industrial Machinery &

Logistics Service Providers

SAP overview Industry solutions from SAP (..Contd)

Oil & Gas

Small and medium business solutions

New dimension products

Financial Accounting (FI)

SAP Application Modules

To understand the various organizational structures from

Functional experience in Procurement.

Organizational levels in a procurement cycle

A client can be termed as a corporate group

A company code is a company (accounting

A plant is the manufacturing facility or branch

Selection and Comparison of Quotations

4. Purchase Order Processing

Vendor invoices are checked for accuracy of prices and contents.

Procurement for Stock

Procurement for Direct Consumption

There are 3 basic forms of external procurement supported by MM

One-time purchase orders

Longer-term contracts with the subsequent issue of release orders

Longer-term scheduling agreements and delivery schedules

One-Time Purchase Order

Contract and Release Orders

Is the Highest Legal Entity

Responsible Organizational Unit for Procuring material / Service

Configuration Enterprise Structure

Defining Organizational Elements

Defining Organizational Elements

Assigning Enterprise Structure

Activate Company code for Materials Mgmt

Material master contains the information on all the

To get familiar with Material Master

Note Fields in red boxes are mandatory fields.

What is Material Master ?

Material Master Data

Stocks in Plant/ stor

Integration of all material data in a single database , prevents the problem of

Each department in company has its own view in material master

When creating or editing a material master data, you go through a number of

In addition to the base unit of measure the system uses for

Purchasing data in material master record

Material Valuation procedures

Demo1_Create Material Master

To create a Material Master

Demo1_Create Material Master

Selective views for creating material master

Demo1_Create Material Master

To maintain the data in Basic data1 view

Demo1_Create Material Master