Configuring Direct/Drop Shipment in APO

We have a situation where the normal physical flow of goods as A>B>C can sometimes occur as A-->C, based on certain business conditions. Direct Shipment can be configured as a distribution channel in R/3. In R/3 world Drop and Direct shipment may be semantically different based on how billing is done. I wanted to know how the drop/direct shipment situation can be configured in APO, particularly in context of Heuristics and CTM. We want system to propose direct shipment, say based on cost to meet a demand. Is this possible at all with CTM or Heuristics? Is Optimizer the only tool to meet the requirement ? Will be great if someone can help me understand the implications/configurations of Drop/Direct Shipment in APO.

Have you you tried this: -
In transportation lanes there is a flag for direct delivery
"In order that the system can plan direct deliveries via flagged transportation lanes, you must specify the value Consider Direct Delivery via Transportation Lanes in the Heu: Direct Delivery field in Customizing for SNP under Basic Settings -> Maintain Global SNP Settings.
This parameter is valid for the SNP heuristic. It specifies whether the SNP heuristic considers direct deliveries from one location to another (such as from a production location to a customer location) via a transportation lane flagged for direct delivery. There is thus no detour via a distribution center.
If you choose Consider Direct Delivery via Transportation Lanes, the system first checks if product quantities can be delivered via flagged transportation lanes. Then the system covers any remaining quantities using the standard source determination.
The default value is No Direct Delivery."

Similar Messages

Direct Drop Shipment for Consignement fill Up.

I am trying to Map a business Process for Cross Company Consignment fill-up.Company A receive Sales Order..On Receipt of Order,Company A placed Stock Transport Order to Company B.Company B will ask his Vendor to hand over the material as Consignment .I am facing some problem with this Process. Can any one share his experience in the Consignment Process?
Thanks

Hi,
u have misudnerstood the process. It is actually 3rd pary sales..follow these steps
Process Flow for 3rd Party Sales
Customize the third party sales in summary:
1. Create Vendor XK01
2. Create Material Material Type as "Trading Goods". Item category group as "BANS".
3. Assign Item Category TAS to Order type that you are going to use.
4. A sale order is created and when saved a PR is generated at the background
5. With reference to SO a PO is created (ME21N). The company raises PO to the vendor.
6. Vendor delivers the goods and raises bill to company. MM receives the invoice MIRO
7. Goods receipt MIGO
8. Goods issue
9. The item cat TAS or Schedule line cat CS is not relevant for delivery which is evident from the config and,   therefore, there is no delivery process attached in the whole process of Third party sales.
10. Billing
SD - 3rd party sales order Create Sales Order
VA01
      Order Type
      Sales org, distr chnl, div
      Enter
      Sold to
      PO #
      Material
      Quantity
      Enter
      Save
SD - 3rd party sales order View the PR that is created with a third party sales order
VA01
      Order Number
      Goto Item Overview
      Item ->Schedule Item
SD - 3rd party sales order View the PR that is created
ME52N
      Key in the PR number
      Save
SD - 3rd party sales order Assign the PR to the vendor and create PO
ME57
      Key in the PR number
      Toggle the "Assigned Purchase Requisition"
      Execute
      Check the box next to the material
      Assign Automatically button
      Click on "Assignments" button
      Click on "Process assignment"
      The "Process Assignment Create PO" box , enter
      Drag the PR and drop in the shopping basket
      Save
SD - 3rd party sales order Receive Goods
MIGO_GR
      PO Number
      DN Number
      Batch tab , click on classification
      Serial Numbers tab
      Date of Production
      Flag Item OK
      Check, just in case
      Post
      Save
SD - 3rd party sales order Create Invoice
MIRO
      Invoice Date
      Look for the PO , state the vendor and the Material
      Check the box
      Clilck on "Copy"
      Purchase Order Number (bottom half of the screen)
      Amount
      State the baseline date
      Simulate & Post
      Invoice Number
      *Invoice blocked due to date variance
SD - 3rd party sales order Create a delivery order
VL01N
      In the order screen , go to the menu Sales Document , select "Deliver"
      Go to "picking" tab
      State the qty and save
SD - 3rd party sales order Create a billing document
VF01
      Ensure that the delivery document is correct in the
      Enter
      Go to edit -> Log
      Save
Reward points if useful,
Regards,
Anbu

Configuration guide for drop shipments

Hello all,
Pl. post any link/documents/Configuration guide for configuring the drop shipment process in SAP.
Thanks,
Maxx

Maxx,
I assume when you say "Drop shipments", you are referring to the process where a customer orders product from your company; you procure the product from a Vendor, the Vendor ships the product directly to the Customer; and you invoice the customer. SAP calls this Third party order processing. SAP has two Best Practices, Here are the Business Process docs, and configuration guides.
Third party order processing w/Ship notification
http://help.sap.com/bp_bl604/BBLibrary/Documentation/107_BPP_EN_US.doc
http://help.sap.com/bp_bl604/BBLibrary/Documentation/107_BB_ConfigGuide_EN_US.doc
Third party order processing without Ship notification
http://help.sap.com/bp_bl604/BBLibrary/Documentation/114_BPP_EN_US.doc
http://help.sap.com/bp_bl604/BBLibrary/Documentation/114_BB_ConfigGuide_EN_US.doc
Rgds,
DB49

Drop-shipment PO from the Vendor to the Customer directly

Dear All,
Can anyone one advice any drop-shipment scenarios how the Standard SAP should look like?
Thank you very much,
Regards,
Chee Wee

Hi
This is called as Third Party scenario.
In this sales order is raised with proper item category due to which system automatically creates PR
Then with referance to this PR PO is raised . Vendor directly delivers material to your customer and raises invoice on you . Who do MIRO posting for vendor .In this case GR is not done at our end but at customer end

Drop Shipment:India Localisation

Hi,
Does Drop shipment work in the perspective of India Localisation taxes?
If anybody has any experience in this, kindly highlight..
Regards,
Sayantan

Prashant,
Drop shipment is used in a scenario for example where you are in construction business and are constructing a warehouse/building and want to purchase materials like bricks for the building, you would purchase the brick from a vendor, however you would request the vendor to have the shipment go directly to the construction site rather than the your/contractors office who is buying the material for the construction.
Therefore, its a shipment address that is not associated with master data.
Hope it helps.

Back to Back Orders and Drop Shipment Order

Hi All,
Can someone enlightment me with the difference between this two orders. Whats the difference?

Hi,
BACK TO BACK ORDER
This process comes in Global Trade Management
Trading Companies are basically huge business coordinators - they connect suppliers with customers, then take percentage of the contract value from both sides as a commission/finders's fee. Essentially, trading companies make their profits by facilitating transactions between companies. One main / core process is the back-to-back business, which is when we have a known customer and vendor when the deal is contracted.
http://www50.sap.com/businessmaps/1E6E402991A64503943AFA3E685F0F2F.htm
DROP SHIPMENTS
This process comes when you are doing third party business,
where vendor ship material directly to customer and raise invoice to your compant and latter you raise inovice to your customer
In third-party order processing, your company does not deliver the items requested by a customer. Instead, you pass the order along to a third-party vendor who then ships the goods directly to the customer and bills you. The standard sales order automatically creates a purchase requisition for the materials to be delivered by the third-party vendor.
In this scenario, the vendor sends a shipping notification. The incoming invoice from the vendor updates the billing quantity, so that the customer-billing document is only possible after entering the invoice from the vendor.
If the customer does not accept the delivered goods from the third party vendor, the customer disposes of the goods. A credit memo is issued to the customer reversing the revenue and cost of goods sold. Then a MM credit memo is created for the third party vendor. A statistical goods receipt reversal is performed for the goods in order to close out the original purchase order. The vendor credit memo may initially be blocked for payment, if previous agreement for this with vendor exists.
Kapil
Edited by: Kapildev Farakte on Jan 21, 2010 9:32 AM

Drop Shipments costing of Inventory using the average method.

How does the system handles the costing of inventory using the average method during dropshipments?
One of my prospects uses average costing method for the accounting of their inventory. The issue now is, how does the system compute s for the cost since the goods/inventory is delivered directly by the supplier to the customer? What is the basis for the amount to be posted in COGS? Thanks!
null

For Drop shipments two inventory movements are still performed. When the goods are initially received (albeit logically), Oracle Inventory immediately issues them out of stock again - just as if you had ship confirmed them. Therefore you inventory accounting is also the same, and will use the purchase price of the goods as the inventory value.

Intrastat Drop Shipment

Hello,
we have the following scenario, which is a Drop Shipment.
Goods recipient (and ByD user): located in UK (EU)
Supplier is located in Switzerland (Non-EU)
Ship-from location (direct to UK): is in Germany (EU)
Question 1: Is this a Intrastat relevant process for UK?
Question 2: What is the trigger here: Money (from CH) or Goods (Germany)?
Question 3: Assuming, it is INTRASTAT relevant, how needs the inbound confirmation (or any other posting) to be done, that this transaction will be craped by a INTRASTAT declaration run?
Thanks and best regards
Marco

Hi Marco,
My personal opinion is that the flow described by you is not Intrastat relevant, since Switzerland is not an “Intrastat” country.
In the form you made the second question, I think that the event's trigger there should be “Money”, or better where the Supplier is located (business residence of the company - CH) since you need to declare goods:
bought or sold
transferred within the same legal entity
sent for process
sent as part of a contract for services
supplied free of charge
on long-term hire, loan or lease
to be installed or used in construction
lost or destroyed - if goods dispatched from the UK are lost or destroyed in transit they should be recorded on the supplementary declarations, this does not apply to arrivals
between EU member states (and that is not the case).
The ship-from location (Germany) should not be relevant because
“You don’t have to declare certain other movements of goods. These include goods in transit, goods sent or returned after repair and goods being moved temporarily within the EU.”
Hope this helps you,
Best Regards,
Antonio

Subcontracting Drop Shipment

Hello SAP gurus,
we want to perform a drop shipment from a subcontractor to one of our plants. The Subcontracting is performed at the plant A. But the delivery should go to the plant B directly via drop shipment from the subcontractor. The plant A and plant B belong to different company codes. For this purpose, no delivery should be created in the SAP system.
Does anyone know how this could will work.
Best regards
Dieter

Hello Dëv Päträ,
your understanding was absolutely correct. The goods issue from factory A to the Subcontractor and the goods receipt in the plant B.
Here the extend to my last statement: The flow of goods: It is now a goods issue / delivery that is to be posted by the Subcontractor - not in our SAP system - and the goods receipt in plant B - is to book by one of us.
The invoice flow: The Subcontractor provides an invoice to the Company Code of plant A. Then, the Plant A an invoice to the Company Code of plant B.
Best regards
Dieter

When running the workflow background process for drop shipment order, sale order line's status gets automtically closed instead of awaiting shipping

Hello friends,
I am created a drop shipment order with all the setups done . now i have booked the sale order as source type external. but when i run the workflow background process , after completing the report when i check the sale order line status it changes to "closed" instead of "awaiting shipping".
Plz guide me if i have missed something in the setups.
thanks,
Sachin

Hi Sachin,
pls check the below notes from MOS
Drop Ship Sales Order Cycle In Order Management (Doc ID 749139.1)
Vision Demo - How To Create A Drop Ship Sales Order/Purchase Order (Doc ID 1060343.1)
Thanks
-Arif.

Centralized purchasing operating unit in drop shipment cycle

Hi all,
In multiple operating units, is there a way to use drop shipment cycle with a central Purchasing Operating Unit?
I mean creating sales order in OU 1, Importing Purchase Requisition and auto create Purchase Order in OU 2(Central Purchasing OU), and receiving in OU 1, then shipping from OU 1
Thanks for all,

Dipanjan Maitra wrote:
Consider this progression for your scenario:
Customer Sales Order is created in OU1 >> Internal requisition is created in OU1 >> Internal Sales Order is created in OU2 with source type as External(dropship) >> Purchase Requisition is created in OU2 >> Purchase order is created in OU2 and sent to vendor >> item received in OU2 >> Internal Order is fulfilled >> Inter-org transfer is initiated from OU2 to OU1 >> Item is received in OU1 >> Customer Sales order is fulfilled in OU1 and shipped from OU1
DipanjanDipanjan
Are you sure Inter-org transfers will work for One OU to other??
Thanks
Mahendra

Drop Shipment /Intercompany-FI Config

Hi, we have a Issue with Intercompnay Drop shipment orders,we made some settings in OBCB and OBCE in EDI,config,but when our vendor sends invoice to us after shipping to customer (our Company"YYYY" makes sales order to Customer A-Vendor,ZZZZ, Ships Goods to A-Vendor Invoices Company YYYY who becomes customer to Vendor ZZZZ),the Document is Failing in EDI ,(WE09) saying "LI/xxxxxxxxx 51 Application Document not Posted", But I can see the Customer (Not end Customer here ,I mean to say our Company) Line items (Our company will become Customer to vendor as vendor Invoices to us ),
Please help us in this what Config need t be done in FI as Sales working fine,Thank you,
Regards,
Sandhya,
Edited by: Sandhya Ameya on Jan 22, 2010 4:50 PM

Hi
The note is of Shipment Cost. I am looking how the cost of Godds can be posted in PA segement. There are some issues in 3rd Party shipment that some of the characteristic values are not passed on to PA segment like SHIP TO.
Thanks
Venkat

Change document serie when using a drop shipment warehouse

Hey all,
I have the following question:
We have a customer wich has 2 document series related to purchase orders. When we use a drop shipment warehouse in our sales documents the SAP system runs the procurement wizard to add a purchase orders related to the sales order.
Now our customer wants to choose the correct document serie to post the purchase order in.
I've already tested this with SAP 8.81 PL 08 but for the moment this is not supported.
If you take a look at the MRP functionality, there is a possibility to change the document series when creating Purchase orders from the order recommandation screen
Will this be on the roadmap of SAP?

Drop-down lists work a little differently than expected; in the Change event the rawValue contains the previously selected text. That's why it works the second time. The current selection is contained in: xfa.event.newText

Some major confusions in ATO vs PTO & drop-shipments & back2 back orders.

dear all
I have researched alot but still cant understand the difference between ATO models and PTO models and ATO items and PTO items.
Please help me..
Secondly I have done numerous research on net and got many setups and steps to perform drop ship orders and back 2 back orders but not even onc ei was succesful doing them
I dont know where am i lacking
I tried it on vision instance
Please help

A google search comes up with this good guide
http://www.oracleappshub.com/om/drop-shipment-functional-setup-and-flow/

Drop Shipment

hi,
i just want to know whether drop shipment is possible in
1. Set of books
2. Operating unit
If possible please do provide the steps or the links.
Regards
sudharshan

Thank you.
Correct me if i am wrong
1.From 11.5.10.2 drop shipment is possbile across set of books but drop shipment is not possible across operating units.
2. Previous versions of drop shipment does not allow across operating units and set of books.
Regards
sudharshan

Configuring Direct/Drop Shipment in APO

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