Optimal Confidential and Proprietary Information

Presentation on SAP Material ManagementBy

Chandra Bhushan Nirala

Materials Management Overview Organizational Elements Organizational structure Master Data Purchasing Inventory Management Physical Inventory Invoice Verification

Topics

Materials Management Overview

SAP Material Management Module supports the procurement and inventory functions occurring in day-to-day business functions.

Materials Management Overview Procurement

– Purchase Requisition– Request for Quotation/Quotation

• Material/Service• Price Comparison

– Purchase Order Inventory Management

– Goods Receipt/Issue– Transfer Posting– Physical Inventory

Organizational Elements

Organizational Elements -Materials Management– Purchasing Organization– Plant– Storage Location– Purchasing Group

Purchasing Organization Responsible for procurement for one or more plants Responsible for negotiating pricing and delivery terms

with vendors Purchasing Organization is assigned to a company where

inventory is legally tracked or costs are legally incurred.

“PLANT SPECIFIC” PURCHASING ORGANISATION

“CROSS – PLANT” PURCHASING ORGANISATION

‘CROSS – COMPANY CODE’ PURCHASING ORGANISATION

Plant A Plant is an organizational unit within a company. A plant produces

goods, renders services etc.

A Plant can be one of the following types of locations:– Manufacturing facility– Corporate headquarters

Storage Locations Storage locations are organizational units that allow

the differentiation of material stocks within a plant. They contain data specific to that storage location.

Storage Location 0010Storage Location 0020 Storage Location 0030

Storage Location 0040

Organizational Structures

Master Data

MATERIAL MASTER

VENDOR MASTER

SERVICE MASTER

PURCHASING INFORECORD

SOURCE LIST

MATERIAL MASTER

MATERIAL MASTER

16

Finished Product –

InventoryQuality

Sales InformationProduction Information

Desc:---------------------

Raw Material - Blade-sm

InventoryPurchasing

Desc:---------------------

InventoryPurchasing

Desc:---------------------

Spare Part

RetailingRetailing

InventoryQuality

Sales InformationProduction Information

Desc:---------------------

Semi-Finished

ChemicalIndustryChemicalIndustry

Material Type / Industry Sector

Vendor Master

VENDOR MASTER GENERAL DATA :

(VALID FOR THE WHOLE CLIENT- NAME, ADDRESS, BANK DETAILS ETC.)

ACCOUNTING DATA :

(MAITAINED AT PLANT LEVEL-RECOCILIATION A/C NO., BANK DETAILS, PAYMENT METHOD ETC.)

PURCHASING DATA :

(MAINTAINED AT PUR ORG. LEVEL-P.O.CURRENCY,INCOTERMS & VARIOUS CONTROL DATA)

Tasks of Procurement

Procurement Cycle

Purchase Requisition

Purchasing – RFQ/Quotation

Inventory Management Overview

Stock Movements

Effects of Goods Receipt Posting

Effects of Goods Issue Posting

Stock Transfer Types

Stock Transfer – MM & SD Route

Material Valuation

Vendor Evaluation

Vendor Consignment

Subcontracting

Physical Inventory - Process

Invoice Verification

Thank you !!