S/4HANA Consignment Process

Updated: Feb 5


Introduction


Vendor Consignment is a process where supplier (vendor) provides material to purchaser and store in premises of the purchaser itself. Ownership of that material is lies in the hands of supplier although it is stored in purchaser premises.

We can say that the material remains in books of the vendor until withdrawn from consignment stock. Inventory in the hands of purchaser gets affected only when the stock gets transferred.

The supplier would not raise invoice initially, a purchaser will only pay after consumption


Key Features of Consignment Process

  • Consignment is a special procurement type in SAP

  • The purchaser will provide the space to vendor to store the material in his own premise.

  • The Purchaser is not responsible for stock.

  • Ownership and liability of stock remains in the hand of vendor.

  • Consignment material number is same as in the book of purchaser’s unrestricted stock.

  • Consignment stock is maintained as individual supplier or vendor level as there can be multiple parties for procurement.

  • Purchasing Info Record is mandatory to maintain for this process. Price of the consignment is also maintains in Info Record. Purchaser has to create the record with Consignment as a category.

  • Goods Receipt against consignment Purchase Order is non-valuated.

  • Goods Receipt happens at the price mention in Purchase Info Record.

  • After making Goods Receipt, stock still shows as Vendor Consignment stock.

  • When purchaser required the material, purchaser transfer quantity from vendor consignment stock to our own stock.

  • Purchaser will pay only for such transferred quantity.

  • The Vendor need not send invoice or bill for withdrawal quantity. An organization will settle the consignment liability

Vendor Consignment Process Basic Configuration Steps


  • Activate Purchase Info record for Info category as consignment

T-code: OMEV

· Configure Special Procurement type



  • Define Special Procurement Type

T-code: SPRO

SAP IMG Screen-> Production-> Material Requirement Planning-> Master Data-> Define

Special Procurement Type


  • Create Consignment Material Master

T-code: MM01- Create Consignment Material

SAP Easy Access-> Logistics-> Material Management-> Material Master-> Create Material Master


  • Create Purchase Infor Record

T-code: ME11

SAP Easy Access-> Logistics-> Material Management-> Purchasing-> Master Data-> Info Record-> Create


  • Create Purchase Requisition

T-code: ME51N

SAP Easy Access-> Logistics Execution-> Material Management-> Purchasing-> Purchase Requisition-> Create Purchase Requisition

  • Create Purchase Order with reference to Purchase Requisition

T-code: ME21N

SAP Easy Access-> Logistics-> Material Management-> Purchasing-> Create Purchase Order


  • Goods Receipt for Consignment Purchase Order

T-code: MIGO

SAP Easy Access-> Logistics-> Material Management-> Inventory Management-> Goods Movement-> Goods Receipt for Purchase Order

  • Goods Movement from Consignment Stock


  • Display Transfer Document

  • Stock Overview

T-code: MMBE

SAP Easy Access-> Logistics-> Material Management-> Inventory Management-> Environment-> Stock-> Stock Overview

  • Goods Issue from Consignment GR

T-code: MIGO

SAP Easy Access-> Logistics-> Material Management-> Inventory Management-> Goods Movement-> Goods Issue

  • Goods Issue from Consignment Stock

  • FI Control Document Stock Position


Rajesh Sharma

SAP MM/EWM Functional Consultant

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