Consignment / Production

Hi all,
I have a scenario where a company will be sending us raw materials into our warehouse. We need to keep these values reflected in our inventory, but there should be no accounting impact (So i was thinking vendor consignment).
However, eventually this company will send us an order to produce finished goods for them using the raw materials they sent us before. I am having trouble on how to set this up in SAP because if vendor consignment is used, there will be an accounting impact since the materials will need to be moved from 'consignment' to 'unrestricted' for our production process.
Any input will be appreciated, thanks

Hi,
I hope this is related to sub contracting process in MM.
ok,lets come to consignment,it is just like related to customer consignment.
so frist the raw material has to be stored at special stock.so it is not included to the total inventry.
so in this frist there is no accounting entry.
next this special stock has to move production.in this case there will be consumption account,which automatically reduced from special stock.
then after finished good is ready you have to send it to that company
againe there is an account which will have customer account Dt and sales account Cr.
Thank you

Similar Messages

Consignment indicator added to production orders

Hi Everyone,
I was wondering if you could help me, we have a raw material that has been moved from consignment to own stock, all the info records have been changed and material moved to own stock BUT when we create a production order the consignment indicator is still being added in the special stock screen!
The production order backflush is creating COGI errors for this material, can anyone tell me where this indicator comes from and how we can change it?
Thanks
Mark.

Thanks for the reply,
I have looked at the issue again and problem is the opposite, my mistake, the material has moved to consignment stock from own stock but the special stock indicator 3 is not being added to the production orders.
Info record looks ok
We do not use anything in the stock determination, nothing is configured, all other consignment materials work fine.
Please help if you can
Thanks

Production order with components consumed from vendor consignment stock

Hi expert,
I have a production order with components and some of the components should be consumed from vendor consignment stock.
When the order is created/released : is there a possibility to have those components created with "special stock indicator" = 3 (consignement stock) by default?
Thanks,
P.

Dear Pete,
In my understanding it's not possible to populate this value as 3 - consignment stock in the component overview.This has to be
done manually.
Check in this way,by indicating a value in any of the material master field(for eg ABC indicator in MRP1 view) and if there's some
value,then while saving the system populates for all those materials with this value as 3 by using some user exit or BADI.
I'm not sure,it's only an idea,check and revert
Regards
Mangalraj.S

Is it possible to create a Production order for consignment fill-up?

Dear all,
As you know, the consignment fill-up is for delivery the own stock to customer special stock.
But our customer request, they want to create a Prodcuction order for the consignment fill-up.
The design flow is like below:
Consignment fill-up -> MRP -> Production order -> GR the FG to local storage location -> Outbound Delivery to customer special stock
So could any one tell me is it possible?
Because I have tried to change the configuration for it, but always failed.
Tks
David

Hello,
Kindly go through following links:
To consider customer consignment stock while MRp with help of user exit/bad
Re: Excluding Kanban storage location from MRP
To consider customer consignment stock while MRp with help of user exit/bad
Can MRP consider customer consignment quantity ?
PP-MRP Exclude Consignment stock in MRP
customer consignment in MRP?
Consignment Fill Up Error
Thanks & Regards
JP

Inventory Management for virtual products

Hi,
Can you please let us know how the virtual products like mobile recharge coupons, lottery coupons are managed in IS-Retail? There is no physical inventory involved in this case but we have the purchase cost, commission and other components involved. But they need to be maintained in IS-Retail system. Please advise.
Regards,
Karthik. K

Hi Karthik,
you can check, if consignment process meets your requirements.
Consignment - Managing Special Stocks (MM-IM) - SAP Library
Regards
Tobias

Purchase order received directly in customer consignment

We are entering a business relationship with a company where we will send the goods on consignment basis (W stock) procured directly from a vendor. The SAP documentation tells about using the consignment fill up process etc., that we would have to do a receiving in our plant (even though we won't touch the product) and then do another document (the consignment fill-up) to transfer it to the customer as 'W' stock. What we would like to do is write a purchase order for the material have it received at the customer directly into 'W" stock. Does this functionality exist in the SAP purchase order? Can this be easily achieved?

[http://help.sap.com/bestpractices/BBLibrary/Documentation/J58_BPP_EN_KO.doc]
[http://help.sap.com/bestpractices/BBLibrary/Documentation/J58_BB_ConfigGuide_EN_KO.doc]
After creating the Sales order, you can trigger a purchase order from a Vendor through MRP and change the delivery address as the customer. So that the Vendor delivers the product to your customer and you can do the goods receipt in your plant. Then you can do the consignment issue from the delivery to the customer in your system.

Static credit check: credit limit exceeded for consignment issue delivery

Hi,
We are encountering a credit limit exceeded error in delivery creation for a consignment issue.
In SPRO config "Credit limit check for order types", no credit limit check is assigned to the order type. However, there is one assigned for the delivery type. Also, for CCAr/Risk cat./CG combination in OVA8 (Auto Credit Block Delivery), static credit check has been activated with error message reaction. Open orders and open deliveries were also activated. Customer exceeded credit exposure but user cannot release the order in any VKMx transactions as no credit limit check is assigned to the order type.
Given that this is the current setup, and the following conditions:
1. Credit limit for the customer cannot be increased
2. Oldest open item cannot be cleared just yet
Is there any way that we can proceed with delivery creation for this customer? The other order types have credit limit check so credit management team was able to release them. However, we are unsure on how to proceed with this consignment order. Kindly advise and thank you in advance for your help.

We are encountering a credit limit exceeded error in delivery creation for a consignment issue.
but user cannot release the order in any VKMx transactions as no credit limit check is assigned to the order type.
Looks contradictory and it may need to run report RVKRED77 to reorganization of open credit values. Try to run the report in test system and then run in production system. After running the report, the use must be able to release in VKM* transaction.
Regards,

Vendor Consignment stock or vendor managed stock

Dear All,
My client wants to manage vendor consignment stock.
Vendor will be given a area and vendor will keep the stock in his area. Based on the plan he will supply the stock.
the GR for rawmaterials will be made on the consumption report given by the production person. This activity will happen next day only. i will do the GR only to the quantity consumed.
for example if i consumed 100 qty, i will do GR only for 100 and vendor will issue invoice for 100. But when the vendor issue the stock, he will raise a excise invoice based on which i have to take excise credit. I want to know how to do the same.
secondly, i take credit for 100 qty, but actual consumption is 95 only, how do i reverse the 5 only excise invoice.
regards
ranga

No, it is possible to sell from vendor consignment stock directly and I have done it in ECC 6.0 (not IS-retail).
- Pls refer the note 607604.
- Establish the 'stock determination rule' in MM -> Inventory Management -> Stock Determination.
- You need to assign it to the material (MRP3 view) or assign it to item-ategory.
- DONOT mark the special stock indicator in item-category used in SD (e.g. TAN) with 'K'..I did this mistake and wasted some time. If you do, it will ask you to populate the Vendor field in the Delivery which is not available and you may get stuck up because of that.
This should make it work.
Pls award points if you find this information useful.
Regards,
Shripad

Make to order and stock both in one material with consignment

Hi Seniors
FERT Material = XYZ which is being used for Make to Order and Make to stock both.
In case of make to stock scenario from GR u2013 101 and PGI made @ std price. At the time of Consignment 631 mvt. No accounting document is generated. As per my knowledge its fine. No issue.
In case of Make to order scenario for above material.
Q.1   At the time of goods receipt (101 Mvt) from production order, accounting document is generated at the rate of Per unit target cost of production order and no variance shown on production order. Why not accounting document is created at Std price of Material?
Q.2 At the the time of consignment an accounting document generated with following entry.
    Finished Goods Inventory      Dr
    Price difference                   Dr
                    Finish Goods Inventory Cr
Why accounting document is generated at the time of consignment in case of make to order scenario? Pls confirm is this a sap standard behavour or anything wrong with me. As I told earlier that in case of make to stock when we make 631 mvt there is no accounting document generated.
Note: My standard price is on the base of mix costing using two production versions. Every time we create production order in each version.
Regards
Imdad

Hi Imdad
Q1: Why not accounting document is created at Std price of Material?
Check your req class... There is a Field called "Valuation"... your valuation depends on whether you select M or A there... You can decide to valuate based on CK11N std cost estimate or based on Sales order cost estimate / Prod order cost estimate
So, in a nut shell, you can configure the system to generate acc doc at CK11N Std cost also
Q2. Why accounting document is generated at the time of consignment in case of make to order scenario?
In my opinion, your MTO stock is maintained in Table EBEW.. Pls check that... WHen you do GR from Prod order, it resides in EBEW table..
However, when you send it as a cons stock, the link to sales order is lost and your stock is no longer a MTO stock.. Hence, it is valuated at CK11N Std Cost.... If there is a diff between CK11N cost and GR Price, then PRD is generated... Thats why you are seeing PRD in your case
BR, Ajay M

Consignment stock, make to order scenario

Hi
We have a material which produce make to stock and make to order also.
In case of make to stock its fine. But when we are testing make to order then following is system behavour.
Action     Mvt Type     Accounting Document
GR     101     No Accounting Document
Consignment     631     Finish Inventory     Dr      at Standard Price
                    Consignment Inventory Change (VKA)     Cr
PGI     633     COGS     Dr      at Standard Price
                    Finish Inventory     Cr
My question is why not accounting document is generated at the time of GR 101 in case of make to order scenario.

Hi
MTO has 3 scenarios in it. (I think you either fall in Scenario 1 or 2)
1. Where the Qty of Prod order is tagged to sales order upon GR from prod order....
The valuation in this case happens at the std cost (CK11N).... Every thiing remains same as in MTS... You get variance as well
2. Where Qty & Value both are tagged to the sales order (Sales order is Cost Object & Stock is Valuated stock)
This is not recommended by SAP and should be chosen only in rare cases...
This scenario pertains to Complex MTO, means totally manufactured based on customer demand.. Like Cars, Boeing Air Crafts, etc
Sale order is a cost object...
Sales order cost estimate is done when sales order is created...
GR is valuated at sales order cost estimate... Variances are calculated based on this cost and actual cost incurred..
PGI and Revenue post to the sales order because SO is the CO object
Finally Sales order is settled to COPA
3. Where Qty & Value both are tagged to the sales order (Sales order is Cost Object & Stock is Non Valuated stock)
This is recommended by SAP
This scenario pertains to Complex MTO, means totally manufactured based on customer demand.. Like Cars, Boeing Air Crafts, etc
Sale order is a cost object...
Sales order cost estimate can be done when sales order is created...
GR is Non valuated... No Variances are calculated because GR is non valuated
Production Order settles upon sales order.. hence, actual cost goes to sales order...
PGI does not generate accounting doc because stock is Non Valuated
Revenue post to the sales order because SO is the CO object
Finally Sales order is settled to COPA
These are the 3 possible scenarios in MTO... There might be a slight variation in Consignment scenario.... I am nt sure if the "No Accounting doc" situation at GR is OK or not
Regards
Ajay M

Two consignment vendors during stock determination

Hi all.
Under customizing related to stock determination I included to have prirority own stock over consignment (for both MM and WM).
My question is how is the stock determination performed in consigment when there is stock of two different vendors for the same part?
I read in Help-SAP that stock determination is applied first in MM and then the system forwards this data to WM (WM stock determination int his case is not possible). There is no sort for prices, nor quantity.
In my particular case, I have two steps for production process (REM); in this case no own stocks exists but consingment for two vendors:
1. In MF60 (movment 319) TRs are created (and then TOs) to move materials into 100 storage type. When 2 different vendors are managed I thought that the system would transfer the older quant but when both stocks are in the same storage bin with the same GR date I don´t understand exactly the stock determination made.
2. MFBF is performed to consume all components (movement 261K); here stock determination is executed again first in MM but I don´t know exactly how the system chooses the vendor
Could it be the criteria different in the first step rather than the second one, so I move physically stock from one vendor but informatically consumed the other one? is there a way to avoid this?
Any clarification will be wellcomed!!!

1) Please read OSS note 365570.
For instance:
- WM dominates
Warehouse Management System WMS picks the necessary quantities independently of the stock category of the materials and only takes the picking strategy into account that is defined in the WMS here (for example, FIFO).
2)
In the stock determination header table you define the priorities of:
- item table (V_T434K-RAPOS)
- price (V_T434K-RAVAL)
- quantity (V_T434K-RAQUA)
Based on these priorities the system will determine a number for each relevant stock item and then sort the internal table (check include: LMDBFFS0).
Additionally you can use user exit EXIT_SAPLMDBF_002 (XMBF0001) to influence the sort sequence.
So, the vendor id itself has no importence in standrard system from stock determination point of view.
Edited by: Csaba Szommer on May 10, 2011 2:44 PM

ECC 600 - Cost Estimates for Consigned Material

We are in ECC 600and planning to implement Consigned Inventory in short time. However I am stuck with Inventory revaluation for consigned material.
Consingment Flow: Vendor ship these items against standard PO at zero price. At the consumption pricing is captured from Purchase info records.
Material valuation: We are using valuation variant 001 Planned valuation - mat. with
<b> Primary Strategy Sequence            </b>
Planned Price 1
Valuation Price 1 Based On Co
Price from Purchasing Info Re
Sub-Strategy Sequence with Purchasing : Strategy Sequence
Purchase Order Price via Condition
Gross Purchase Order Price
Effective Price from Purchase Order
However when I try create cost estimate I am getting following error,
" No price could be determined for material/batch <......>/ plant <..> "
Any suggestions.
Thanks
Uday

Thanks for the quick response. I did maintain Purchasing info record using ME12. We do see pricing information at the time Production order backflsh. However contract and PO has no pricing information. Therefore initial GR is created with zero price. However at the time consumption against prod order, consignment material gets price from the Purchase info record. Bur consumption documents are not linked back to PO.When I try to cost these material using CK11N, SAP gives following messages,
Msg.typ Material Plnt Area MsgNo Message Text
I 1000 CK 037 Lot size 1 EA taken from costing view
I 1000 CK 776 No valid source of supply found for material plant 1000
E 1000 CK 465 No price could be determined for material/batch / plant 1000
I 1000 CK 361 Value of costing item 00001 in itemization is 0
E 1000 CK 240 Cost component split costed with value of zero
Any clue.
Thanks,
uday

Third-party-order in combination with consignment?

Hello,
we need to handle the process that our vendor has to deliver goods directly to a customer consignment stock? In the SAP OSS I only found a note that this process is not designed yet.
Has anyone a good idea to get an efficient process?
Thanks for help.
Kind regards
Sandra Oppl

Hi Sandra,
Companys Own Special Stocks
Definition
Stocks belonging to your company that are stored with the vendor or the customer.
In the R/3 System the following types of companys own special stocks are available:
Stock of material provided to vendor
Consignment stock at customer
Returnable packaging stock at customer
Since these special stocks are not located at your own company, they are managed at plant level and not at storage location level.
Two stock types are possible:
Unrestricted-use stock
Quality inspection stock
All stock types can be inventoried.
Use
Stock of Material Provided to Vendor
These are your company's own stocks that you provide to the vendor (subcontractor) to manufacture a product you have ordered. However, this stock is still your company's property. This stock is available for Materials Planning.
The goods movements for materials provided to vendor are described in Subcontracting .
Consignment Stock at Customer
This is consignment material belonging to your company that is stored with the customer. This stock is not available for materials planning.
In Inventory Management, you can post the following goods movements (with reversal):
Initial entry of stock balances (movement types 561, 563)
Transfer posting from plant to plant in one step (301)
Transfer posting from material to material (309; also refer to Entering Transfer Postings from Material to Material)
Other goods movements are processed using the Sales (SD-SLS) component. See also: Managing Consignment Stocks.
Hope this could be helpful to you.
Regards
Srikanth.A

Control of vendor consignment stock

Hello
We have agreements with some of our suppliers about vendor consignment stock. Problem is that from a financial point of view, we don't fell we are having enough control about the values of the consignment stock.
When the supplier deliver the goods physically on our location, we agree about the prices. Deliveries to other prices can be mixed with each other - in other words; we do not empty the consignment stock before getting new materials from the vendor. When ordering materials for consignment stock it is done via a purchase order, item category K and price 0.
When using the consignment stock material we do it via MVT 411, which creates a posting - value of this posting is the price from an info record. Monthly the consumed materials are settled via MRKO.
Problem is that we would like to know the price of the consignment stock - before it is used in production, even though it is not our goods, but we have committed to pay a specific price.
Best regards
Søren Kirch

Hi
Please note that in ECC 6.0 way back in 2006 SAP had introduced new functionalities for Consignment material for Retail (internal distribution) and for wholesale customer sale (SD sale).
To over come this problem of stock determination for DC to store distribution (Plant to Plant) we need to do customization for stock determination and prioritization of stock (which type of stock should be considered when a particular movement type is called).
The same stock determination group once configured and assigned to movement type should also be maintained in Article master Store or DC view. Article consignment indicator in the Article Store or DC view should also be marked as "1".
Depending on the Source of supply 2 or A the transactions pick up stock types as mentioned in the Stock determination group (As prioritized).
When you create an STO (Stock transfer order) the item category for Consignment is not populated any where but when you do Goods issue in outbound delivery the 411 K indicator will be picked up in the background.
This will allow movement of Vendor consignment stock from one plant to another.
I hope i answered your question.
Devesh

MRKO Consignment by Sales

We got a deal with a supplier where we get consignment raw material, and pay it after we sell the finished product.
The problem its that the quantities for the sales will never be the same as the MIGO documents or the tranfsfer movements. (Since the supplier gets a report of the exact quantity we sell its seems to be an issue there)
Its there an option to pay consignment materials thru the quantity sold in a certain period?
Regards,
Carlos

Dear,
consignment raw material, and pay it after we sell the finished product
You get RAW MATERIAL and process it to make finish product and sell it.
quantities for the sales will never be the same as the MIGO documents
Yes the quantities received compare to finish product is not same.. In this view is there any contract / agreement with vendor ... about any differences.. I assume that from the raw material some may be wasted, some qty may be production loss etc etc (I guess this you are considering for quantity differences).
Its there an option to pay consignment materials thru the quantity sold in a certain period?
Is there any standard measurement to claim this much quantity raw material used in producing certain volume of finish product.. If this analyse and fixed by your production planning department and an agreement exists with supplier... you can make payment basing on this (I Hope there will a unique vendor for supplying raw material and no question of r/m from diff. vendors and mix up in production.
Usually, SAP standard Consignment process, supports whenever you withdraw stock for consumption, it considered as liability for the vendor and has to pay for the entire quantity.
Regards,
Syed Hussain.

Consignment / Production

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