Intercompany scenarios for trading company

[former_member805659]

Hi Everyone,

We have an intercompany scenario; however we do not have SAP best practices followed for intercompany. 

Company A (Construction Company)

Company B (Procurement Company)

Company C (Third-Party supplier)

Company A & B belong to the same group, and use the same systems and share the same SAP client.

We are currently not using the intercompany options within SAP, everything is done manually.

1. 1. Company A creates a PR
2. 2. Company B based on the PR gets multiple quotes, sends via email to Company A.
3. 3. Company A selects one of the quotes by replying in an email.
4. 4. Company B then creates a sales offer with a markup and issued via email to Company A.
5. 5. Company A accepts the prices and creates a PO with Company B as the vendor.
6. 6. This is then approved by finance manager of company B whether to proceed or not on creating a sales order.
7. 7. Company B then converts the Sales offer to a Sales Order,
8. 8. Company B then creates a Purchase order by linking the sales order. When the sales order is saved, a PR is generated; we use this PR to then create a Purchase Order to be issued to Company C (Vendor).
9. 9. Company B does the GR (though we do not receive the goods physically) and creates an outbound shipment.
10. 10.  These goods are then shipped to Company A.
11. 11.  Company A then does the GR/MIGO against its PO.

This is a very manual process, however we do not have a constant markup rate, and we are looking forward to having a constant markup rate.

My question is: We want to initiate the intercompany process; however the external consultant says that in our current scenario we cannot. In Intercompany the PO is created and the corresponding Sales Order is created, the consultant states that the Sales Order cannot trigger a PR so a corresponding PO to Company C can be initiated. The other reason that the consultant mentioned was that we do not hold stocks, we trade the materials and do not hold stocks, but does this really stop intercompany scenario?

Any help on this would be great.

[jagdeepsingh83 · Accepted solution]

Lets breakdown more on this and I will suggest different approach to your business process

1. Company A and Company belong to same corporate group ? if yes these will be mapped as company codes, Company C is vendor- this need not to be mapped in vendor master. (No need to map as company code).

2.  User will create a PR for requirement directly in company B with account assignment U. (This means it can use MRP to create a PR or manually create a PR), then you create the RFQs (ME41) on the multiple vendors, Vendor will respond back with prices, I am assuming here Mark up price will be fixed and there will no process of getting approvals on e-mails

3. Maintain the prices for RFQs (ME47), You can setup on release strategy on RFQs for getting the quotes approved by any personal from company B (as you have common user master). The shortlisted Quote get approved ( You can add various levels relevant competent authority here too, in your case finance)

5. Create Stock transfer order with Mark up price (Document Type NB- You can create another document type too.) used in inter-company stock transfer process. You can also setup approval process for this document type too.

6. You create a Purchase order to fulfill the requirement with reference to approved RFQ.  Buyer need to mention the account assignment C for sales order that created in Step (as you are no longer use account assignment U in PO). You also setup release strategy to get approval from various levels of competent authority.

I have skipped step 4 from your requirement as it is more on manual side-Company B then creates a sales offer with a markup and issued via email to Company A

5. Perform the GR w.r.t to PO in Company B-MIGO

6. Create Outbound delivery with Reference to Stock transfer Order-VL10B

7. Perform Post Goods Issue and Create Billing document on Company A-VL02N

8. Receive goods in Company A with Reference to Outbound Delivery (MIGO)

There may other solutions to same scenario that you can consider. But I think this approach you will less number to transactions and documents created in the SAP system.

I can also note that the PR you are creating in Step 1 in your approach is not getting close or ordered. if you follow your approach, how you will close the PR you created in Step 1 ?

[former_member805659 · Accepted solution]

Hi Jagdeep,

Im not too sure how the account assig U will work for us. Company A's POs are WBS based with account assig P.

As for the STO from Company A to company B, Company B should have stocks - we are a trading entity and do not hold stocks unless required. But if the PO initiates before the stock is available, can an STO PO be posted?

Thanks much for the detailed explanation.

Rgds,

Daine

[former_member218067]

Hi,

Up to point 8, it is clearly third party scenario, but the point 9 overrules that

When you do not have Physical Stock with B, how will you create outbound delivery and PGI?

Instead vendor C can physically deliver to A , by posting GR at B and B can raise invoice on A

Thanks

DD

[former_member805659]

Hi Diwakar,

Company B does not hold stock as in, Based on Company A's request we purchase, and this is received in our warehouse only after a PO to the vendor is issued, that is when we have stock. We do not hoard materials, the purchases are purely request based and we do not use the concept of MRP here. Only if company A issues a PR to company B, followed by a PO to with mark up to Company B, only then do we proceed on procuring the material.

Thanks

Daine