We shall differentiate the process from the make to stock production strategy. Then we will walk through the SAP make to order process. The process begins with creating the make to order material master for finished goods.
Next, we show you how to create a quotation based on the customer request for the make to order product. We will then demonstrate creation of the sales order with reference to the quotation. Finally, we will create the production order in the Production Planning module to trigger the production process. Make to Order — The product is not manufactured in advance, but produced once the customer order is received, as with high-end cars, motorcycles, textile products etc.
Make to Stock Production Strategy Consumers use and buy make to stock products regularly, thus they are necessities rather than luxury items. Companies create demand for these goods through advertising, promotions, activations etc. Companies keep safety stock levels of finished goods in their stock in case of high demand due to seasonal changes or festive events. Advertisement The production process begins once the forecast is finalized.
Material requirements planning MRP is executed and requirements are generated for the manufacture of the finished goods. The required raw materials are requested from the respective departments. For raw materials not produced in-house, purchase requisitions are generated, along with the required date of delivery, and sent to the procurement department. In the make to order production process, a sales order initiates the demand for production.
The production department creates a bill of material to produce the required quantity and runs MRP. Requirements for components manufactured in-house are sent to the respective department and if any component needs to be purchased, a purchase requisition is raised and sent to the procurement department. Finally, the finished goods are delivered and invoicing is carried out. Now we shall demonstrate the steps in the SAP make to order process.
We will demonstrate the simpler approach. Execute transaction code MM02 to change an existing material master. Advertisement In the initial screen, enter the material number you want to update and hit Enter. Then, select the Sales: Sales Org. Data 2 view, as shown below:. Press Enter and enter the organizational level data in the pop-up screen.
Update the item category group to — Make-to-Order as shown below: Update Material Master Create Quotation In the scenario described earlier where a customer requires a completely customized order for embroidered towels, the customer submits their requirements to the company, then the company must generate a quotation.
In the initial screen, enter a quotation type and hit Enter to enter the quote information. Create Quotation Initial Screen Enter the following information: Code of the customer that requested the product Validity dates for the quotation Finished goods material number from the last step Order quantity Create Quotation To update the pricing for the custom order, highlight the relevant line item and press the item conditions button.
Select Product for Pricing Click the Conditions tab to see the price for the item. Update as necessary to correspond with the required customizations. Update Pricing Hit Enter then Save. The quotation will be saved with a confirmation message: Advertisement Note down the quotation number. Once the customer places the order based on the quotation, create the sales order with reference to the quotation created in the last step.
Execute transaction code VA01 and enter the relevant sales order type in the initial screen. In the pop-up window, click the Quotation tab and enter the quotation number created in the last step.Stock transfer between two plants in different company codes is known as inter company stock transfer.
Create a vendor for the company code of receiving plant, using account group: using T-Code XK Assign this vendor to Delivering plant. In pricing procedure determination relevant to STO, assign document Pricing Procedure and customer pricing procedure appropriate for STO to get the pricing in the invoice.
Assign the delivery type to document type. Assign the document type NB to supplying plant and receiving plant. Create Delivery: VL10G. If possible could you please help, Somewhat this is Urgent. Browse pages. A t tachments 0 Page History. Jira links. Purpose The purpose of this document is to introduce the steps to map inter-company STO. Overview Stock transfer between two plants in different company codes is known as inter company stock transfer. Material should be maintained in both supplying and receiving plant MM01 2.
Stock should maintain only in supplying plant MB1C 3. Create receiving plant as a customer in supplying plants company code and sales area XD01 4. Assign this customer number in receiving plant details OMGN 5.
Assign supplying sales area in supplying plant details OMGN 6. Steps 1. Create internal customer with the sales area of the vendor.
SAP Make to Order Process
Go To XD01 4. Maintain condition records for the relevant pricing condition. Assign the document type NB to supplying plant and receiving plant Vijay Mittal. Permalink Feb 14, Content Tools. Powered by Atlassian Confluence 6.In the business scenario I am trying to implement, I have some plants distribution centers which are replenished from the manufacturing plant through the process of Stock Tranport Orders purchase order type UB. Imagine that from business perspective the distribution centers plants are the ""customers"" of the manufacturing plant therefore their relative STO should be handled as MTO.
If you are running MRP in the manufacturing plants, STO demands from the distribution center plant will be evaluated and planned orders created to satisfy them. It will still be necessary to convert these to production orders though. As far as I know, there is no equivalent STO configuration that behaves like the MTO process driven by sales orders and linked production orders. MRP Areas may provide the functionality you are looking for. If you have an ABAP programmer available, you can also look at the option of automatically creating the production orders in a batch process, based on the new STO's created that day.
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How to create a delivery wrt STO
Sign up. Dear all, In the business scenario I am trying to implement, I have some plants distribution centers which are replenished from the manufacturing plant through the process of Stock Tranport Orders purchase order type UB.
Thank you in advance, Kind Regards Stathis Papadopoulos. Hello Stathis; If you are running MRP in the manufacturing plants, STO demands from the distribution center plant will be evaluated and planned orders created to satisfy them. Hope this helps, Terry. Terry Lyons. November 29, PM. Something went wrong on our end. Please try again later.
Sign In to Post a Comment.The interface between the Sales and Production departments is a critical one. Very often the two departments work in silos. All strategies discussed here, are at the crossroads between demand and supply.
It is a goal to be agile and fulfill every customers wish on time and on quantity, but it is also important to minimize waste and enable smooth replenishment and production. Proper use of the planning strategy helps achieving both goals.
A big problem, one that I encounter a lot, is that products are not optimally set up for either one of these strategies. Either the wrong assignment happens, or Production has a different idea than Sales, about what the product assignment should be.
The ultimate achievement, one that both Production and Sales strive for, is to have the right product at the right place in the right quantity at the right time.
Planning strategies are one of the most important drivers to achieve exactly that. When your product is a commodity that can be sold out of a catalog and is defined and specified through a master record, it can be planned; if it is somewhat predictable. A steady consumption in the past helps predicting the future, however, there may be events in the future which require a more forward-looking planning process.
In any case, if you can somewhat predict what will happen, you may consider a Make To Stock strategy. Even if it is hard to predict the future, but the customer does not accept long delivery times, you might be required to make some of your product to stock. Making to stock means production without actual requirements. The Sales Order does not drive the production program but the forecast does. Incoming Sales Orders use existing inventory for the delivery which keeps the customer lead time to a minimum.
If there is no stock your service level degrades and the customer needs to wait for the next receipt from production. This strategy still is for standard products which have a clearly defined specification. Other than MTS, there is absolutely no forecast on products which are made to an order from a customer. When you identify a product to be made to order, the availability check in the Sales Order needs a lead time; the time it takes to replenish or produce the product from soup to nuts.
Therefore when a customer requests the item, no freely available stock to fulfill the order can be found. Everything is made from scratch and takes its time. All too often there is pressure to fully utilize the line; and that can only be done with orders resulting from a forecast.
If MTS fills the line and MTO orders drop on top, they fall into backlog and the quoted lead time to the customer is a farce. What this means is that you can decide at what point in the BoM, material is kept in stock readily available for further processing. ATO provides flexibility, speed and helps reduce waste. Other people would say its agile and lean at the same time. Disconnect between Sales and Production 3: Assembly strategies have the capability to generate a production order to assemble the finished product right out of the sales order.
As this happens, the system can also check on component availability and if there is a shortage, it can provide a reasonable date for when the finished product can be delivered. If that date is not fixed, and I have not seen a Sales person fix a date yet, production scheduling is burdened with a demand for today… and tomorrow for tomorrow… and so on and so forth. Please take a moment to think about what is done here: the Sales Rep agrees a date with the Customer who would be quite happy to get the product on that date in the future.
However, that same Sales Rep tells the Production people that the product needs to be available right away. Consider how many orders there are and that this pressure pops up every day from now on until the order is delivered, you can easily see that there is room for improvement in the communication department. When a standard product has variations in its specification, one needs to answer the question whether to create a material master record number for every variation or to make use of the variant Configurator.
In case the VC is used, an underlying structure will have to be build, which allows you to configure a variation of one configurable material number based on features and options. The underlying structure has optional values and characteristics that have dependencies and limitations.As per the Model GST draft law, stock transfers across states or different registrations within the same state are GST relevant transactions. These processes must have a GST Invoice.
This document provides information about creation of Info record, capturing GSTIN in vendor master and customer master, creation of new billing document type, setting up pricing procedure for STO, copy control, classification of conditions types, maintenance of business place wise GL determination. You may create document with any other name.
Maintain the entries of same dummy GL in OB40 for all the tax codes which has been used above. For the tax codes that are created for GST, maintain condition record for atleast one condition from tax procedure with 0 rate and key combination "Tax Classification" A table.
This is required to make the tax code active for the tax procedure. We have millions of materials SKUs and hundreds of stores Plants. This relationship info record is mantained at purchase org level in Retail solution. This configuration is stopping us to use the process for multi-plant sender having common vendor receiver. Browse pages. A t tachments 10 Page History. Jira links. For information about stock transport orders with delivery, see Note You must create a vendor master record for the purchasing organization of the receiving plant.
Return STO in SAP Logistics
You must assign the supplying plant to the vendor master record. You must assign a customer master record to the receiving plant. You require a customer master record for the receiving plant.
This customer master record must be created for the organizational units of the supplying plant. Execute transaction code VOFA.Generally, Stock movement happens between storage location to storage location, plant to plant or company code to company code.
Inclusion of delivery cost, tracking of transit stock can be achieved through STO. This document shall address how the return process happens in STO. Business Need. Process flow. The process starts with the creation of Normal STO till the receipt of return product by issuing plant. Normal STO:. Return STO:. Key organization structure. Company code — Intra company code. Normal STO Process. PO history shows complete inter company STO process. Stock overview shows, qty.
Stock qty reduced in plant shipping plant to customer. Customer reported defect in shipped qty of The qty of received back to the plant Stock is received back to plant Now this qty needs to be sent back to supplying plant for rectification. Return indicator needs to be selected. MD Stock list in Receiving plant shows negative qty due to return. MB5T: After goods receipt against outbound delivery, return stock is placed in stock in transit.
ME23N: The complete return history is shown below.
MMBE: Stock overview shows defect product is being returned to supply plant In case of inter company code STO, the process ends with internal credit memo because of billing. Configuration Overview.ME21N Create PO STO Plant to Plant from SAP
With the above process and customization steps, SAP logistics consultants would understand the return STO process and hopefully this would serve a better content for them.
Author Bio:. He has business experience in various industries like Manufacturing, Electro mechanical Construction and process industries as a Procurement Executive.
Brilliant with a good process flow to lead one in. Just the way a professional would layout things. However, I have a clarification to make. It just mentions Post goods receipt instead. Also, can you provide the Tcode at each step beside the process description?. Thank you for sharing your knowledge with us just like the other professionals whom I admire daily for helping. Many thanks for you documentation Mr Mohamed Hasan Rifaie. Mohamed Hasan Rifaie M.
Posted on November 21, 4 minute read.Generally, Stock movement happens between storage location to storage location, plant to plant or company code to company code. Inclusion of delivery cost, tracking of transit stock can be achieved through STO. This document shall address how the return process happens in STO. Business Need. Process flow. The process starts with the creation of Normal STO till the receipt of return product by issuing plant.
Normal STO:. Return STO:. Key organization structure. Company code — Intra company code. Normal STO Process. PO history shows complete inter company STO process. Stock overview shows, qty.
Stock qty reduced in plant shipping plant to customer. Customer reported defect in shipped qty of The qty of received back to the plant Stock is received back to plant Now this qty needs to be sent back to supplying plant for rectification. Return indicator needs to be selected. MD Stock list in Receiving plant shows negative qty due to return.
MTS, MTO, ATO, CTO, ETO… Strategies to connect Sales with Production
MB5T: After goods receipt against outbound delivery, return stock is placed in stock in transit. ME23N: The complete return history is shown below. MMBE: Stock overview shows defect product is being returned to supply plant In case of inter company code STO, the process ends with internal credit memo because of billing. Configuration Overview.