THIRD PARTY SALES RELATED INFORMATION:-

Process Flow for 3rd Party Sales

Customize the third party sales in summary: 1. Create Vendor XK01 2. Create Material 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 config 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, distr chnl, 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 Goto 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 Clilck 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

An Example of Third Party Sales

Scenario: 2 companies are created in system - India & Singapore Customer places sales order for particular material on Singapore. Singapore is not able to produce the same. They pass on the order to India for processing. After processing India ships the material directly to the customer along with necessary documentation. Invoice copy is passed on to Singapore. Final Commercial Invoice will be raised by Singapore. How can the above scenario handled? By: Balaji You can do this using third party sales. The third party sales process is as under. 1) Singapore company creates an order for the Singapore customer. 2) Because of the configuration settings of the sales document type, item category & schedule line category, as soon as the order is saved a PR (purchase requisition) is automatically generated. This is converted into PO (purchase order) and sent to the Indian company. 3) Indian company supplies the material directly to the Singapore customer. 4) Indian company sends the invoice to the Singapore Company. 5) Singapore company does the invoice verification in MM using tcode MIRO. 6) Singapore company raises the invoice to the Singapore customer. In standard SAP, item category TAS is used for this. The schedule line category is CS. Here you can see a field 'order type' with value 'NB'. This triggers the automatic creation of the PR. Plus in the material master also you need to do certain settings. 1) If you are always following a third party process for a material then you have to create the material using item category group BANS. The procurement type should be marked as external procurement (F) in MRP 2 view of the material master record. 2) If you are not always allowing third party order processing then you 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 procurement (in house manufacturing and external procurement). In the item category the billing relevance should be 'F'.

SPRO Configurations check for Third Party Sales 1. Configurations list for third party sales in SPRO settings

2. Click on Define the item category and define TAS as Third party Item. Click on Display details icon.

3.

Check whether the Billing Relevance is defined as F {Order related Billing Doc- status according to invoice quantity}. Click on logoff button.

4. Click on Define Item Category Group BANSThird Party Item. Click on Logoff icon

5.

Click on Assign item Categories and assign standard order type OR to third party item category group BANS and item category TAS. Click on Logoff Icon

6. Click on Define the Schedule line categories and define the schedule line category as CS Leg

7.

Click on display details icon and define Order TYPE as NB (Purchase Requisition Standard), Item Category as 5 (Third Party), Account Assignment Cat as 1 (Third- Party)

8. Click on Assign Schedule Line Categories and assign item category TAS to schedule line category CS

Material Master:

1. Create Material as trading goods and under sales organization 2 select the item category group as
BANS.

2. Under MRP1 view, make sure to select MRP type is selected as ND-> no planning.

3.

Under MRP 2, make sure procurement type is selected as F External Procurement.

Business Process Steps

1. Create 3rd party sales Order (initial screen) T-Code VA01

2. Sales order overview screen. Enter the sold to party, material, quantity and storage location and hit
enter.

3. Sales Order: Purchase Order Scheduling Screen. Click on continue

4. Schedule line for the third party standard sales order

4. Pricing condition maintained for the material

5. Check for completion and save the document.

6. Enter TCode ME5A in the command bar and hit enter.

List of purchase requisitions screen. Enter material and plant

7. Click on the purchase requisition number.

8. Purchase requisition for the standard third party sales order created. Double click on PR no to check the
source of supply and other details > Back.

9. Enter TCode ME21N in the command bar and enter.

Create purchase order w.r.t PR. Click on the document overview screen at the top left corner of the screen. Click on the variants icon and Select the purchase requisition and click on adopt icon under the document overview.

10. Check the purchase Order tabs such invoice etc.. and save the document.

11. Enter MIRO in the command bar to create Invoice verification for vendor. Enter the company code
and hit enter.

12. Enter the invoice date, amount, and at the item level, change the tax code to I0 (A/P sales tax exempt),
and jurisdiction code to IL0000000 and click on Simulate.

13. Check the GL accounts.

14. Click on Save/Post

15. Enter VF01 to create billing document for the customer and hit enter.

16.

Overview of the billing items.

17 Save the billing document

Document Flow of the Standard Third Party Sales Scenario

Third-Party Order Processing

Purpose
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. A sales order may consist partly or wholly of third-party items. Occasionally, you may need to let a vendor deliver items you would normally deliver yourself. The following graphic shows how a third party business transaction is processed.

If you order products from a third-party vendor, who delivers the goods directly to you so that you can then deliver them to the customer yourself, you can use individual purchase order processing.

Process Flow
The processing of third-party orders is controlled via material types. Material types define whether a material is produced only internally, can be ordered only from third-party vendors, or whether both are possible. For example, a material that is defined as a trading good can only be ordered from a third-party vendor. However, if you manufacture your own finished products, you may also want, from time to time, to be able to order the same type of product from other vendors.

Processing Third-Party Orders in Sales

Third-party items can be created automatically by the system, depending on how your system is set. However, you can also change a standard item to a third-party item during sales processing manually.

Automatic third-party order processing

If a material is always delivered from one or more third-party vendors, you can specify in the material master that the material is a third-party item. During subsequent sales order processing, the system automatically determines the appropriate item category for a third-party item: TAS. To specify a material as a third-party item, enter BANS in the Item category group field in the Sales 2 screen of the material master record. Manual third-party order processing

In the case of a material that you normally deliver yourself but occasionally need to order from a thirdparty vendor, you can overwrite the item category during sales order processing. For a material that you normally deliver yourself, you specify the item category group NORM in the material master. If, as an exception, you use a third-party material, change the entry TAN to TAS in the ItCa field when processing the sales document. The item is then processed as third-party item.

If address data for the ship-to party is changed in the sales order in third-party business transactions, the changed data will automatically be passed on to purchase requisition and also to the purchase order ,if one already exists. In the purchase order, you can display the address data for the ship-to party in the attributes for the item. You can only change the address data for the ship-to party in the sales order for third-party business transactions, and not in the purchase order.

Processing Third-Party Orders in Purchasing

When you save a sales order that contains one or more third-party items, the system automatically creates a purchase requisition in Purchasing. Each third-party item in a sales order automatically generates a corresponding purchase requisition item. During creation of the requisition, the system automatically determines a vendor for each requisition item. If a sales order item has more than one schedule line, the system creates a purchase requisition item for each schedule line. Purchase orders are created from purchase requisitions in the usual way. For more information about creating purchase orders, see the Purchasing documentation. During creation of the purchase order, the system automatically copies the delivery address of your customer from the corresponding sales order. In a sales order, you can enter purchase order texts for each third-party item. When you create the corresponding purchase order, the texts are automatically copied into the purchase order. The number of the purchase order appears in the document flow information of the sales order. All changes made in the purchase order are automatically made in the sales order as well. For example, if the vendor confirms quantities and delivery dates different from those you request and enters them in the purchase order, the revised data is automatically copied into the sales order. How Purchasing Data Affects Delivery Scheduling During the automatic delivery scheduling of third-party items, the system takes into account lead times specified by the purchasing department. For example, the system allows for the time required by the vendor to deliver the goods to your customer and also the time required by the purchasing department to process third-party orders.

Comparing Purchasing Data with Sales Data

You can create a list of all sales orders with third party items for which there are discrepancies between the quantities ordered, invoiced, canceled, or credited in Sales and the quantities ordered, invoiced or credited in Purchasing.