How to Set-up Inter-company Stock Transfer

How to set-up inter-company stock transfer process i n SAP

How to set-up inter-company stock transfer process in SAP with delivery and billing documents Stock transfer is a movement of goods from one plant to another. The goods may be of any material type and the supplying and receiving plants may belong to same or different company codes. When the plants belong to same company code it is a case of normal stock transfer but when the plants belong to different company codes it becomes a case of inter-company stock transfer. Before discussing inter-company stock transfer further, further, first let us look at how to setup normal stock transfer process (between plants of same company code). This will help us to appreciate the additional settings required for inter-company cases. As often used in practice, we will see the set-up of normal stock transfer process using SD delivery. There is usually no relevance of billing in this process as the transaction occurs within the same company code. Billing may be relevant in case the plants are in different countries and plants abroad functionality is used. Company Code A

Supplying Plant

Goods movement

Receiving Plant

Normal stock transfer

It is assumed that the reader has a basic knowledge of SAP Materials Management and Sales & Distribution modules. The screen shots are from IDES, SAP R/3 4.7 Enterprise system.

Normal stock transfer The steps for set-up of normal stock transfer are as follows: 1. Define which document type will will be used for the stock transfer. transfer. For this, assign document type of purchase order that is to be used for stock transfer to the combination of supplying plant and receiving plant. For normal stock transfer, document type UB may be used. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock

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Transport Order  Assign Underdelivery Tolerance.

Document

Type,

One-Step

Procedure,

2. Assign the required delivery type to the combination of purchase order type and supplying plant to specify that an SD delivery is to be created for the physical stock transfer. Unless required otherwise, standard delivery type NL may be used. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Assign Delivery Type and Checking Rule.

3. Assign a valid sales area to the supplying plant in customizing. The delivery document of type NL will be created in this sales area. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Define Shipping Data for Plants.

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4. Create a customer (only general data), preferably with same name as receiving plant, in account group for internal customers. Assign this customer to receiving plant in customizing. This customer will be used as Ship-to party in the NL delivery. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Define Shipping Data for Plants.

5. Goods movement type 641 for normal 2-step transfer is defined in standard schedule line category NN in customizing. Ensure that this movement type is maintained in the schedule line category used. 641 movement type is used for posting goods issue in NL delivery. The customizing path in IMG is Sales and Distribution  Sales  Sales Documents  Schedule Lines  Define/ Assign Schedule Line Categories. Unless required otherwise, schedule line category NN should be assigned to standard delivery item category NLN in customizing.

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6. After the customizing steps a few steps for master data set-up are required for proper execution of the process. Extend customer assigned to receiving plant (from step 4) to the company code and sales area of supplying plant (from step 3). 7. Extend the materials to be transferred to both supplying and receiving plants and sales area of supplying plant (from step 3). The reader is encouraged to try out these steps in a sandbox or IDES environment to gain familiarity. Let us now see the settings required for set-up of inter-company stock transfer process with delivery and billing document creation. New settings for inter-company process are marked with a check sign. Company Code A

Supplying Plant

Company Code B

Goods movement

Receiving Plant

Inter-company stock transfer

Inter-company stock transfer with delivery and billing documents 1. √ Define which document type will be used for inter-company stock transfer. Assign document type of the purchase order that is to be used for intercompany stock transfer to the combination of supplying plant and receiving plant. For inter-company stock transfer, document type NB may be used. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Assign Document Type, One-Step Procedure, Underdelivery Tolerance.

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2. √ Assign the required delivery type to the combi nation of purchase order type and supplying plant to specify that an SD delivery is to be created for the physical stock transfer. Unless required otherwise, standard delivery type NLCC may be used. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Assign Delivery Type and Checking Rule.

3. Assign a valid sales area to the supplying plant in customizing. The delivery document of type NLCC will be created in this sales area. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Define Shipping Data for Plants. 4. Create a customer (only general data), preferably with same name as receiving plant, and assign to receiving plant in customizing. This customer will be used as Ship-to party in the NLCC delivery. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Define Shipping Data for Plants. 5. √ NLCC delivery document will be relevant for only inter-company billing and not normal billing. This status is indicated in processing tab in the delivery header and is controlled by billing relevance of delivery item category (standard NLC) in SD customizing. The billi ng relevance should be ‘D’. In case automatic batch determination is active it should be ‘N’. The customizing path in IMG is Sales and Distribution  Sales  Sales Documents  Sales Document Item  Define Item Categories.

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6. √ Inter-company billing type IV is determined from sales order type DL in customizing. DL is the default order type for delivery type NLCC. The intercompany invoice is created in the sales area of the supplying plant (from step 3). Payer is the customer assigned to the receiving plant (from step 4).

7. √ Goods movement type 643 for normal 2-step cross-company transfer is defined in standard schedule line category NC in customizing. Ensure that this movement type is maintained in the schedule line category used. 643 movement type is used for posting goods issue in NLCC delivery. The customizing path in IMG is Sales and Distribution  Sales  Sales Documents  Schedule Lines  Define/ Assign Schedule Line Categories. Unless required otherwise, schedule line category NC should be assigned to standard delivery item category NLC in customizing.

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8. √ For 1-step transfer (meaning goods receipt in receiving plant happens automatically at the time of goods issue in supplying plant), tick the one-step indicator in customizing for stock transport order. In this case, the 1-step movement type 645 is used as specified in NC schedule line category. In 1step stock transfer only one material document is created for both goods issue (movement type 645) and goods receipt (movement type 101). The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Assign Document Type, One-Step Procedure, Underdelivery Tolerance.

One-step indicator

9. √ After the customizing steps a few steps for master data set-up are required for proper execution of the process. Create a vendor in receiving company code and purchasing organization in account group for internal vendors. Assign the supplying plant to this vendor in purchasing data view (Extras  Add purchasing data). This vendor will be used in stock transfer order as the supplier.

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10. Extend customer assigned to receiving plant (from step 4) to the company code and sales area of supplying plant (from step 3). 11. Extend the materials to be transferred to both supplying and receiving plants and sales area of supplying plant (from step 3). In practice it is often required to do a reversal of stock transfer process when the receiving plant needs to return goods to the supplying plant. For such cases we require the inter-company stock transfer return process. New settings for inter-company return process are marked with a check sign. Company Code A

Supplying Plant

Company Code B

Goods movement

Receiving Plant

Inter-company stock transfer return

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Inter-company stock transfer return with delivery and billing documents 1. √ Define which document type will be used for inter-company stock transfer return. Assign document type of the purchase order that is to be used for inter-company stock transfer return to the combination of supplying plant and receiving plant. For i nter-company stock transfer return process NB document type may be used as in the case of normal inter-company stock transfer. No new document type is required. To create a stock transfer return order, tick the return indicator on the purchase order item line. With this indicator, the flow of goods is reversed but supplying and receiving plants remain the same. In terms of goods movement, stock in the receiving plant decreases and in the supplying plant it increases.

Return indicator

2. √ Assign the required return delivery type to the combination of purchase order type and supplying plant to specify that an SD return delivery is to be created for the physical stock transfer return. Unless required otherwise, standard return delivery type NCR may be used. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Returns Order  Store Return / Return Plant to Plant. Please note that the designated supplying plant in case of return will be the same as that in normal stock transfer.

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3. Assign a valid sales area to the supplying plant in customizing. The delivery document of type NCR will be created in this sales area. The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Define Shipping Data for Plants. 4. Create a customer (only general data), preferably with same name as receiving plant, and assign to receiving plant in customizing. This customer will be used as Ship-to party in the NCR return delivery. As this is already done earlier, no additional customizing is required. Please note that the designated receiving plant in case of return will be the same as that in normal stock transfer. 5. √ NCR delivery document will be relevant for only inter-company billing and not normal billing. This status is indicated in processing tab in the delivery header and is controlled by billing relevance of return delivery item category (standard NCRN) in SD customizing. The billing relevance should be ‘J’ assuming batch determination is not required for returns. The customizing path in IMG is Sales and Distribution  Sales  Sales Documents  Sales Document Item  Define Item Categories.

6. √ Inter-company billing type IG is determined from sales order type DLR in customizing. DLR is the default order type for delivery type NCR. The intercompany credit memo is created in the sales area of the supplying plant (from step 3). Payer is the customer assigned to the receiving plant (from step 4).

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7. √ Goods movement type 673 for normal 2-step cross-company transfer return is defined in standard schedule line category NS in customizing. Ensure that this movement type is maintained in the schedule line category used. 673 movement type is used for posting goods receipt in NCR return delivery. The customizing path in IMG is Sales and Distribution  Sales  Sales Documents  Schedule Lines  Define/ Assign Schedule Line Categories. Unless required otherwise, schedule line category NS should be assigned to standard return delivery item category NCRN in customizing.

8. For 1-step transfer return, tick the one-step indicator in customizing for stock transport order. In this case, the 1-step movement type 675 is used as specified in NS schedule line category. In 1-step stock transfer return, only one material document is created for both goods transfer returns (movement type 675) and goods receipt returns (movement type 161). The customizing path in IMG is Materials Management  Purchasing  Purchase Order  Set up Stock Transport Order  Assign Document Type, One-Step Procedure, Underdelivery Tolerance. 9. √ There may be a special requirement in certain industries such as Consumer Products to post returned goods in blocked stock instead of standard quality inspection stock. In such cases new movement types may need to be created by copying standard movement type 657 (GD returns blocked) and referencing control settings of movement types 673 or 675 depending on

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whether 2-step or 1-step transfer is required. An important control setting is the Movement type category field highlighted below. This field controls whether the movement is cross-company. The customizing path in IMG is Materials Management  Inventory Management and Physical Inventory  Movement Types  Copy, Change Movement Types. A reverse movement type should be created for every new movement type created.

10. After the customizing steps a few steps for master data set-up are required for proper execution of the process. Create a vendor in receiving company code and purchasing organization in an account group for internal vendors. Assign the vendor to supplying plant in purchasing data view (Extras  Add purchasing data). This vendor will be used in the stock transfer order as the supplier. 11. Extend customer assigned to receiving plant (from step 4) to the company code and sales area of supplying plant (from step 3). 12. Extend the materials to be transferred to both supplying and receiving plants and sales area of supplying plant (from step 3). As you try out this set-up in a sandbox or evaluation system, it may be useful to review the basic transactional flow in SAP for normal 2-step inter-company stock transfer process. This process flow may be helpful during testing.

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Reference inter-company stock transfer process flow 1. Create a purchase order with transaction ME21N using document type and internal vendor as described above and enter materials and receiving plant in item lines (in case of stock transfer return tick the return indicator on the item lines). 2. Create replenishment cross-company delivery with transaction VL10G. The delivery type will be determined automatically. 3. Enter delivery number in transaction VL02N and post goods issue. 4. Display and check goods issue material document and accounting documents in document flow. 5. Post goods receipt with reference to purchase order with transaction MIGO. 6. Display purchase order with transaction ME23N and check goods receipt material document and accounting documents in Purchase order history at item level. 7. Create inter-company billing document with reference to delivery document with transaction VF01. The billing type will be determined automatically. 8. Display and check accounting documents related to billing in document flow.

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How to Set-up Inter-company Stock Transfer

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