Consignment Procurement in SAP MM

Consignment Procurement in SAP MM:

                    In consignment procurement process, vendor keeps his stock of material in plant premises and there is no invoice from vendor and no payment to vendor. When we need material we can withdraw from vendor consignment stock and for that withdrawal quantity only we have to settle the liabilities to vendor.

                    For this, first we have to activate consignment prices via info record. (Path: SPRO--> MM --> General settings for MM--> Activate consignment prices via info record.)

Steps for Consignment procurement in SAP:

Step-1: Create info record in ME11

      Enter Vendor, Material, Standard Purchase Organization, Plant and info category as Consignment. Here Tax code is must.Enter prices, validity periods in condition screen.

Step-2: Create Purchase Requisition (PR) in 'ME51N''

       Enter item category as 'K', material number, Quantity, Plant, Storage location. Here Account assignment category entry is not possible with item category 'K' combination.

Step-3: Create Purchase Order (PO) in 'ME21N'

       Enter vendor number, standard purchase organization. In item row enter PR number, then click enter.

Note: Here Net Price is graded out.Condition tab is disappeared because price will be picked from info record at the time of settlement but not from PO.

         Here invoice tab is also disappeared. So the tax code will be picked from info record.

If we observe consignment item category details, GR non-valuated is firmed and IR indicator is also firmed.It means these are selected from back ground but hided in PO.

Step-4: Enter Goods Receipt (GR) in 'MIGO'

        In MIGO, in Goods Receipt enter PO number and movement type '101'. In where tab movement type is 101-K and stock is shown as belongs to vendor.Item OK.Check and Post. 

Note: Here ' No subsequent document found in accounting'.

         In 'MMBE' our stock is not increased but vendor consignment stock is increased.This stock is not belongs to our company. It still belongs to Vendor.That's why no accounting document is created at GR.( In IMG, item category consignment GR non valuated is selected)

Step-5: Enter Goods Issue to cost center in 'MIGO'

      In MIGO, in Goods Issue, select other. Enter movement type '201-K'. Enter material, quantity, Plant, storage location.click enter. In account assignment tab, enter cost center. Item OK. Check and Post.

Note: In MMBE, vendor consignment stock decreased.

         Here accounting document is created. (transaction keys: -KON, +GBB with VBR)

         Account payable credited(-) with info record price and consumption G/L account is debited (+) with material master standard price.and differed price will be posted to price difference account.

Step-6: Settle consignment Liabilities to GI quantity in ' MRKO'

          In 'MRKO', enter company code, vendor, plant, material, consignment. Select settle. Select check boxes of withdrawals not settled and settled withdrawals. And then Execute. Click on created settlement document number. Observe amount details.

Step-7: Transfer posting form Vendor consignment stock to our own stock.

         After completion of consignment agreement, if still some quantity is left over in vendor consignment stock, then that stock to be converted into our own stock.

         In MIGO, in Transfer posting, select other and Movement type '411-K'. Click enter.

In Transfer posting tab, enter material, plant, storage location, special stock indicator as 'K' and vendor.

In quantity tab, enter quantity,. Item OK. Check and Post.

Step-8:  Settle consignment Liabilities for this owned stock in 'MRKO'