SAP MM Simple Procurement Cycle

SAP MM Simple Procurement Cycle

The Materials Management Module (MM) of SAP is completely integrated with other modules such as (SD, FICO, PP, WM, PM).

Procurement in SAP MM comprises of following.

• Determination of Requirements
• Source Determination
• Vendor Selection
• Purchase Order Processing
• Purchase Order Follow-up
• Goods Receiving and Inventory Management
• Invoice Verification

Determination of Requirements:  This phase comprises of identification of Material Requirements. This can be based on the user or MRP proper/Demand based approach to inventory control. Purchase Requisitions can be created manually (ME51N) Release (ME54) or can be generated using the System.

Source Determination: This Phase comprises of identification of potential sources of supply. This can be based on past orders, and existing agreements.

Vendor Selection: This Phase comprises of comparison of quotations received from Vendors. The system can check different quotations received from vendors.

Purchase Order Processing: In this phase information is acquired from the Requisition and the Quotation. Purchase Orders can be generated by the system or they can be created manually (ME21N).

Goods Receiving and Inventory Management: The goods receipts number can be obtained by entering the Purchase Order number.

Invoice Verification: Here Invoices are matched,.