Third-Party Process with Direct Delivery

Dear All,
I've been searching for proper solution/suggestion for the following scenario for long time, but until today, I still unable to get the best practice solution for it. Can anyone please help me to understand this?
When shall we use "stock determination" or "batch determination" or using both together? Can I have the scenario from the reality world?
Appreciated for help and thanks in advance.
Regards,
Edwin Fu

Hi All,
Sorry I'm using a wrong title.

Similar Messages

Third party process with Valuated sales order stock

Hi All,
We have third party sales order process with valuated sales order stock. The problem is that in the theird party PR which is triggered directly from the sales order it determines a stock account which is assigned to the BSX key in OBYC.
But since this is third party processing as per my understanding a consumption account assigned to key GBB-VAX (since account assignmnt category is X) should get determined, so that when the GR is done against the PO a consumption posting is done in the background.
I am not able to understand if the system is determining the stock account due to the fact that it is valuated sales order stock and if so, what should happen after GR. Should we have a stock created for the material which is physically directly delivered to the customer?
Regards,
V S

Hi,
Check GBB-VKA which is defined in OME9 for your ''E'' Account Assignment Category that SAP will debit upon GR posting
Also check "X" GBB-VAX and the G/L account assignment in OBYC
The posting on GR should be debit KBS -Credit GR-IR
Thanks
Diwakar

Third party process in MM

Hi friends,
i need all your help in configuring third party process in MM.please guide me by giving step by step process with t-codes.
your advise is considdered more valuable.
Regards,
william

Hi,
Process Flow for Third party process with SD-MM Integration
Customiztion requires is
1) Defining the Purchasing org,Purchasing group,
2) Assign the Purchase org to company code
3) Assign Purchase org to plant,
Material type used should be Trading goods -- HAWA
1. Create Vendor XK01
2. Create Material with Material Type as "Trading Goods" & Item category group as "BANS".
3. Assign Item Category TAS to Sales Order type
4. Sale order is created and in the background a PR is generated
Note down the PR number along with Sale order no
5. With reference to PR a PO is created (ME21N).
PO will be sent to the Vendor with delivery address as your Customer.
6. Vendor delivers the goods to the Customer and raises Invoice to the Plant.
7. Goods receipt MIGO & stock update in the Plant ( Not physically)
8. MIRO for Vendor to clear the Payment
9. Create the outbound delivery for sales order
10. Post Goods issue for delivery
11. Billing for the customer
rgds
gsc

GR in Third Party Process

Friends
I read threads regarding Third Party Process but it made me more confused. Jus want some clarification.
1.Does GR take place in third party process or not and if not then how can we make it happen.
2.We want customer invoice to be created before MIRO. Can we do it. If yes then how.

Hi,
1) There are two types of Third Party Processes: -
a) Third Party Process without Shipping Notification
b) Third Party Process with Shipping Notification.
Third Party Process without Shipping Notification
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.
The incoming invoice from the vendor updates the billing quantity, so that the customer-billing document can only be created after entering the invoice from the vendor.
Process flow: Third party Sales Order --> Convert purchase requisitions to purchase order --> Approval of purchase orders --> Invoice verification --> Billing
Third Party Process with Shipping Notification
For this process, 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.
The vendor then sends a shipping notification. After that a statistical goods receipt is posted. The incoming invoice from the vendor updates the billing quantity, so that the customer-billing document can only be created after entering the invoice from the vendor.
Process flow: Third Party Sales Order --> Convert Purchase Requisitions to Purchase Order --> Approval of Purchase Orders --> Post Statistical Goods Receipt --> Invoice verification --> Billing
So, technically the 3rd Party Sales w/o SN is commonly used - whereby no GR is required. GI and GR process is between the vendor and the customer in the Sales Order. Once customer confirmed received, only then there will be incoming invoice from the Vendor, which then MIRO and Billing follows..
2. Standard SAP practice.. it is recommended to perform MIRO before Billing, as the vendor has to advice us that our customer has received the goods of the quantity ordered, which only then we can bill the customer according to the quantity received by the customer.
Thanks.
Hope this helps.
Rgds.

Requirement to bill customer before vendor invoice in third party processing

We have a requirement to bill a customer before the vendor invoice in third party processing. The reason behind this is because the vendor send invoices only once in a month and the customer cannot wait for so long to to receive their invoice from the business.
I saw some discussions that the third party processing with shipment notification can be used however when I check the business flow in that case I see the following.
A Third-Party Sales Order is created and a purchase requisition is generated automatically
A list of purchase requisitions to be assigned is displayed
The assigned purchase requisitions are converted into purchase orders
The purchase orders are approved
A statistical goods receipt is posted
The vendor invoice is verified and posted
The billing is created
It clearly says that the customer billing document is only possible after entering the invoice from the vendor. Which would be the best way to fullfill this requirement?

Do you mean the goods issue done by the vendor to the customer in the vendor system? And this quantity will be copied into our ( where the third party order is created) system?
No, MIGO done by in our company system only. May be you might have misunderstood because of my sentence.instead of company i mentioned as Vendor.
For Vendor this process will become as standard sales and he will do PGI. However in our system we do MIGO .
Suppose the customer ordered 10 Qty. Vendor delivered 2 Qty wouldn't the above equation Order qty- MIGO qty= Invoice qty be 10-2= 8? but we should be really billing the customer only for 2 right?
No you have mistaken my idea, it was not a formula just i was giving example.
Billing qty is nothing but it is qty copies from source document to target document.
E
Goods receipt quantity less invoiced quantity
for example order qty is =10 and vendor delivered first time 2 qty to the customer and he billed our company for 2qty and we billed the customer for 2 qty.
And next time let us assume again Vendor delivered 4 more qty and billed us 4qty.And this time when you are billing the customer in VF01 system will propose the 4qty only( total goods receipt qty 6 - already invoiced qty 2).
Hope now you understood the meaning of E(goods receipt qty less invoices qty).
And did you try your requirement as mentioned in my first reply?
thanks,
Srinu.

Credit Check with Third Party Process

Hi Gurz,
I know about third party process but my problem is with credit check of the customers.
If customer has not got enough credit limit to process the order in normal senario credit controller has to manually release the order as system blocks it. In third party process system will give you warning message when saving sales order about customer credit limit but allows you to save sales order. Once saving sales order it authomatically creates Purchase Requisition. From PR purchasing creates P.O. with out knowing about customer credit limit issue. and so on. In other words goods supplied to customer even though credit limit has exceeded. This user don't know untill raising the invoice to the customer which is too late.
Can we stop creating Purchase requisition or block purchase requistion for credit check ? or there are better way of handling the process for credit check?
Thanks in advance

Hi,
Try to implement OSS note -738171 - Delivery block does not influence purchase requisition.
Following is the details of the note;
Summary
Symptom
The delivery block in a sales order does not prevent the generattion of the purchase requisition in a third-party or individual purchase order item. Regardless of the Customizing settings in the delivery block, the system confirms the TAB or TAS item and generates the purchase requisition.
More Terms
Order, purchase requisition, PReq, TAB, individual purchase order, individual purchase order item, TAS, third-party, third-party item, SD order, delivery block, VBAK-LIFSK, VBEP-LIFSP
Cause and Prerequisites
Solution
Create a user-specific user requirement (for example, 902: BEDINGUNG_PRUEFEN_902 in Include LV07A902) as a copy of standard user requirement 102 and assign it to requirement 'Preq' by using Transaction OVB5.
In the source code of the user-requirement, program a check for the delivery block which, if necessary, triggers an ERROR_EXCEPTION which prevents the generation of the purchase requisition.
You can use the existing check for the credit block as a template.
Regards,

Delivery date should be confirmed in third party process

Dear Experts,
I have one doubt in third party process i.e., while creating sales order how can we confirm the delivery date because here vendor deliver the goods to customer but if customer is asking for delivery on a particular date then how can we assure him the delivery date is there any tracking in standard or how to solve this requirement.

Dear Venkatesh
In the third party Process, the Vendor will deliver the goods. That is correct. so as per my experience the delivery dates will get copied to Sales order ----- PR ----then PO. Then the vendor will also deliver the goods on the date which is mentioned copied into PO only.
Also refer to the below link to gain complete knowledge to clear your doubt.
http://help.sap.com/saphelp_scm700_ehp02/helpdata/EN/c1/42c95360267614e10000000a174cb4/frameset.htm
Thank you
Srikanth

Delivery address in Third party process.

Dear All,
I have one query in third party process.
Created third part sales order,where PR is generated automatically.Based on PR (purchase requisation) created Purchase order.
When I select item category S-Third party,system will pick the delivery address from the sales order.
But when I change the item category to L-Subcontracting the delivery address is not picking from sales order.It is taking the delivery address of the plant. I need system to pick delivery address from the sales order.
Please let me know if I need to do any customisation for the above process.
Thanks in advance,
Awaiting for your early reply.
Babu

Hi,
In standrad application it is not possible. however, there is a user exit here, EXIT_SAPLMMDA_001, in which you can implement your own logic to select the address.
Regards,
S Anand

Third Party Process ASN

We have configured a third party process for specific sales orders. We receive an inbound ASN with shipment information and then we create the outbound invoice, directly from the sales order, after we post the inbound invoice. Is it possible, and how, to create an outbound ASN, from our system to the end consumer, based on the information in the inbound ASN? We would prefer not to create an outbound delivery document in our system and would like to generate the outbound ASN off the outbound invoice or the original sales order.
Thanks for the help.
Chris

We have configured a third party process for specific sales orders. We receive an inbound ASN with shipment information and then we create the outbound invoice, directly from the sales order, after we post the inbound invoice. Is it possible, and how, to create an outbound ASN, from our system to the end consumer, based on the information in the inbound ASN? We would prefer not to create an outbound delivery document in our system and would like to generate the outbound ASN off the outbound invoice or the original sales order.
Thanks for the help.
Chris

Re Third Party Processing Interview Questions

Hai Friends
This is the similar type of Questions I faced in the interview.
a. Explain the third party process
b. What is the item category used?
c. How will a PR or a PO get created automatically? What are the settings required?
d. Is it necessary to make a Goods Receipt before creating the Invoice Receipt? What are the setting involved?
e. When does a customer invoice get created?
pl mail me the solutions to these Questions to my mail id <REMOVED>
Message was edited by:
        Yathish K

Hi
Third party order processing is as follows:
Assume three companies X, Y and Z
X - The company,
y - The customer
Z - Vendor
When ever X gets a PO from Y to supply some goods, X has an option of either manufacturing those goods or procuring those goods.
If he is procuring the goods, there are two methods that are generally followed:
Method 1) After receiving the PO from Y, X creates a sales order against Y.
Now at the same time he also creates a PO to a vendor Z to produce the goods
Z produces the goods and supplies to X
X receives the goods from Z
Then X delivers the same goods to Y.
After that X invoices Y and Z invoices X.
Note : Here there is no direct/ Indirect relation between Z and Y.
This process is known as Trading Process. and the Material here is created with Material type HAWA.
The other method is a Third party order processing method:
Here the glaring difference is that instead of Z supplying the material to X and X in turn supplying the same material to Y.
X authorizes Z to supply the material to Y on his behalf and notify him once the delivery is complete.
Now Z supplies the material to Y and acknowledges the same to X.
Z will send a copy of delivery acknowledgement and invoice to X.
After receiving the delivery confirmation and invoice from Z, X has to verify the invoice and this process is known as invoice verification and is done in SAP through Tcode MIRO.
The next step for X is to create an invoice and submit to Y
Only after the invoice verification document is posted then only X can create an invoice for Y.
This is the business flow that is followed for third party order configuration.
There are few steps that have to be configured to enable the system to function as mentioned above.
Step1)
If you are always followwing a third party process for a material then you have to create the material using item category group BANS.
The procument type should be marked as External procurement (F) in MRP 2 view of the material master record.
if you are not always allowing third party order processing then u can create a material master record with item category group as NORM and the procurement type should be marked as ( X) meaning both types of procurment ( in house manufacturing and external procurement).
step 2)
the item category in the order should be manually changed as TAS.
For that you need to confugure the item category determination
ord type + item cat grp + usge + Hiv level = Item cat + Manual item cat
OR + NORM +      +       = TAN . + TAS
OR + BANS +       +       = TAS
Step 3)
make sure that during the item category configuration for TAS you need to mark relevnat for billing indicator as F
step 4)
The schedule line cateogry for this type should be CS.
make sure that you mark subsequent type as NB - purchase requisition in this schedule line category as this will trigger the purchase requision order immediately after the creation of the sales order and the PO to vendor is created against this purchase requiesion.

Free of charge third party process.

Dear Gurus,
I want to create a sales order with a third party material with zero price, create a PO and invoice the PO with zero value.
Could you please tell me how this can be achieved and what are the necessary settings in config to be changed?
Thank You
Kumar

Hi Kumar,
the third party process is as follows:
1.Customer will order the material from the Company X.
2.Company X will not have stock of the material.
3.Company will raise a PO for the material to the Vendor & asks the Vendor to deliver the material to the customer.
4.Vendor will directly deliver the material to the customer & will send the invoice to the Company X.
5. Company X will then raise a invoice to the Customer wrt on the Sales order.
Create a Sales order with item category TAS, Schedule line category CS(standard).Once the SO is saved, go to the change mode of the SO, go to Schedule lines tab, & note down the PR number.
With reference to the PR, create the PO & then MIGO and MIRO.
Then create the invoice wrt the SO.
Let me know if you hav any problems.
Regards,
MP

Third Party Process and Inventory

We are using the SAP function "Third-Party Processing". We are using the function in it's standard (SAP R/3 4.7).
The auditor now has the following issue: Shipping the goods starts after paying the goods. Out of this, while shipping the goods, we are the owner of them. In this circumstance the ship is our warehouse.
SAP does not allow an Inventory Management within Third-Party Processing:
"Since a third-party order involves a movement from the vendor direct to the customer, Inventory Management is not in any way affected. If you wish to document the movement in the system, however, you can create a goods receipt for the third-party order."
With the SAP functions in this scenario it is correct that the warehouse stock is not being impacted. This is a conflict with the opinion of the auditor.
Let me explain in detail what is wrong out of the view of our auditor:
For example we initiated the order of a customer in June and we have paid the goods in June. The shipment starts in June and the goods will arive in July. Due to the fact, that we are the owner of the goods on the ship, we have to increase the stock. This is the opinion of our auditor.
Does any body know, how to solve the issue? How do you manage Third Party Processing & Inventory?

Some auditors just dont understand the SAP process. Instead of talking to weak users, they should talk to SAP directly.
What about shipments from standard sales orders that are shipped end of June and do arrive at the customer in July?
When do you bill your customer? when the goods arrives there, or earlier? Depending on the Incoterms you may still be the owner until the truck is unloaded.
If you change your process and post goods receipt to your warehouse, then you show inventory where no physical inventory is, you posted a goods receipt without a physical receipt. I am sure the next auditor will not allow such therotical process.
Get together, IT consultants of FI and MM and SD, strong business people for the same modules and the auditor, and discuss and find an optimal solution.And let the auidor sign the decision paper!!! Very important, I recently had to convice German auditors because they had different opinion than the Australian and US auditors of the same auditing company (and the issue had nothing to do with local legal requirements).

Third party process - error

Dear all,
In the third party process, have we to create outbound delivery?
I have created PO from PR of a third party sales order. And now, i don't understand to delivery to customer.
Pls tell me solution.
If we have to create outbound delivery from that sales order, i get errors:
Item category TAS is not defined and Item category TAS is not defined, so item 000010 will be disregarded. I also checked in VOV4, VOV6, VOV7.
Thank you,

Hi
In third party scenario the material is delivered to your customer thro out side vendor
You are billing your customer
Vendor is billing you for the material he has delivered to your customer
Here we dont make any delivery
Process Flow for 3rd Party Sales
Customize the third party sales in summary:
1. Create Vendor XK01
2. Create Material u2013 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 configuration 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, distribution channel, 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
      Go to 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
      Click 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
Hope the process is very clear to you now
Regards
Raja
Edited by: ramanathan raja on Sep 18, 2008 3:06 PM

Third Party Process Issue

Hello Friends,
Need Your Inputs for below issue"
in third party process: SO is created with 2 line items, -->PR-->PO--> Vendor delivers only 1 item and MIRO is done for it,
But
During Creation of Customer invoice Both Line items are considered in the Invoice(F2)
1st line item with the Value of X Rs, and 2nd Line item with zero value ( as there is no delivery done to customer and hence no invoice via MIRO)
Requirement is:
The 2nd Line item should not be considered at all during Customer invoice creation.
Item cate used is TAS with billing relevance F (i,e standard config)
Kinldy help
regards

hello srinu..
SO is created with 2 line items, PR is auto created. 1 PO is created (with 2 line items)
MIRO is done w.r.t PO line item 10 only,
then when i create customer invoice from SO i get 2 line items, for 1st line item there is value populated. 2nd line item has zero value,
The requirement is that if there is no Processing of SO for line item 2 ,, then it should not be populated in the customer invoice.
Regards

Third Party Process in Materail Management (No SD)

Hi,
Our Business would like to outsource the Stationary materials to supply the required materials directly to requester.
I believe the best possible solution for this requirement is to implement third party process in Material management as we do not have SD Module.
In this scenario, which material type we need to use (Item category group, Field ref, Sref material type and field ref) and the config part.
Secondly, does it have any effect on MRP, Stock levels? Also please explain the process involved in Goods returns
Appreciate, if you could share your experiences.
Regards
Kumar

Creating a Third-Party Item Manually
To enter a third-party item in a purchase order without an SD order or purchase requisition, proceed as follows:
Enter a third-party item manually in the same way as the purchase requisition.
After entering the account assignment, you receive a screen in which you can enter the address of the sold-to party.
Enter either the customer number or a delivery address.
Check whether goods receipts can be made for the third-party item. Goods receipts are possible if the goods receipt indicator is set in the item.
Save the purchase order.
Setting the Goods Receipt Indicator
The account assignment category X in the Customizing system of Purchasing determines whether a goods receipt can be posted for a third-party item. Here you define whether a goods receipt is possible, not allowed or compulsory.
If a goods receipt is possible, the GR indicator in the purchase order item is changeable. When you enter the purchase order, you decide if a goods receipt is to be posted or not.
Mat Type can be use ROH or Trading
For Return you can do return to your plant or ask vendor to pivk and replace the goods or issue the creadite to customer and take from vendor

Third-Party Process with Direct Delivery

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