consignment

[Former Member]

hi

code for customer consignment.

[Former Member]

Hi chaitu,

Consignment stock process

1. In the consignment stock process, a business allows stock or materials to sit at the customer’s site or allows stock that is reserved for the customer to sit at its own site. This is done through an agreement that the customer will sell or consume as many of these materials as he can. Only after the customer has consumed or sold anything will the business issue an invoice. Should the customer not want to sell or consume any more material he informs the business and it returns their stock.

2. All requirements transferred from consignment sales orders to materials planning are transferred as individual requirements. This occurs regardless of what availability checking group indicator is set on the respective material master.

3. Consignment stock is monitored in our system by individual customer and material. This consignment quantity is controlled separately from the available stock for standard sales orders. This type of stock is refereed to as SPECIAL STOCK. Other forms of special stock are RETURNABLE PACKAGING.

4. Special stock indicators are allowed for a schedule line category only in case of CI and CR and not for CF and CP.

Consignment Fill-Up - CF

1. The business delivers stock to a customer on consignment. This process is called consignment fill-up. Its uses the document category C (VOV8) and a different number range to treat the consignment sales process different from the standard sales cycle.

2. The consignment fill-up uses the standard sales document type KB/CF, delivery type – LF; no billing document type or invoice is relevant at this stage as fill-up is not considered as a sale.

3. The item category for consignment fill-up is KBN, (VOV7); schedule line category – E1/E0; Movement type – (631) – is the key that at the time of goods issue, posts the stock into a special consignment category in the delivering plants stock for that particular customer and material.

4. The most important thing to note at this stage is that CF doesn’t have PRICING, BILLING, CREDIT CHECK, COST DETERMINATION, SPECIAL STOCK.

5. Copy control must be set at item and schedule line levels. And a delivery block could be set for sales document KB (VOV8)

6. After customising entries, create a consignment fill-up order (VA01 – doc.type CF) followed by delivery and goods issue. (no billing is done for fill-up).

7. VA01(CF) – VL01N (DELIVERY LIST) – LT03 (TRANSFER ORDER) – VL02N (PGI).

8. Note: No billing is done at this stage.

9. To view the stock on consignment for this customer go to MB58 or MMBE

10. An automatic credit check is done on the open items with consignee that is unpaid. But a manual credit check should be done on consignee before every consignment fill up is done.

11. When a consignment fill up is carried out, the system checks the available quantity of stock in the delivering plant to see if this quantity can be met ……….when the system proceeds with a consignment issue or consignment pick up, the system checks the stock represented at the customers site to see if there is an available quantity left.

12. Once the consignment fill up is done, the customer may consume the material or sell them. He then informs us about the number of units consumed.

Consignment Issue – CI

1. In the consignment process, the customer only pays when he sells or consumes the materials. The business issues the sale to consignee via an order type CI (or) KE. This is again a standard sales document type with category C. Delivery type LF, delivery related billing type – F2

2. Order type – CI; Standard item category – KEN, Schedule line category – C1/C0 (which is relevant for delivery); movement type – 633.

3. In case of consignment CI – PRICING, COST DETERMINATION, BILLING, CREDIT CHECK, SPECIAL STOCK are taken into consideration.

4. For consignment special stock indicator is W.

5. VA01 (CI) – VL01N (OUTBOUND DELIVERY – YOU CAN DO PGI HERE ITSELF) – VF01 for the quantity consumed. (INVOICE – F2)

6. Once PGI is posted, the consumed stock is reflected in the consignment stock, which can viewed either in MB58 or MMBE.

Consignment Return – CR

1. The consignment return is sales process flow that represents faulty materials or the product consumed or sold by the consignee. This process should not be confused with the pick up of materials.

2. The consignee puts the faulty stock back into the consignment stock and requests either a credit note or free of charge subsequent delivery in return. It is to be noted that faulty items are not returned to main stock at the plant, instead they are returned to the consignment stock – to make balanced inward and outward movement of stocks.

3. The sales document category is H and a returns document should always have different number range for the visibility of returned items.

4. It is also suggested to promote a special shipping condition for returns process that causes a special shipping point that can used only to process return deliveries. In addition to that, all returns documents can be made to have mandatory reference procedure from the billing document for a clear visibility. (M in case of reference from billing)

5. Do not forget to assign to reference document in the copying control rules and make sure you select the update document flow in the copying control rules.

6. sales document type – CR; delivery type – LR (though the actual stock is added to the consignment stock and not the actual stock in plant, the consignee will call to pick up the unused faulty goods and simply consume the rest of the material, and thus the consignment stock will physically increase); billing type (order related billing relevance in VOV7)– RE ; item category – KRN ; schedule line category – D0 (no MRP and availability check required for stock returns as we are receiving stock back into our plant); movement type – 634; special stock indicator – W

7. transaction flow = VA01 (CR) – VL01N ( post goods receipt) – VA02 (remove the billing block) – VF01 (credit for returns)

8. It is suggested to have a billing block in order to check if the credit is authorised and valid. Thus assign the standard billing block is 08.

Consignment pick-up

1. The consignment pick-up process is the last and final process linked to the consignment procedure. It is responsible for picking up of faulty material as well as the picking up of excess materials not yet consumed by a consignment issue.

2. Sales document type – CP; document category – C; item category – KAN; schedule line category – F0/F1 ; movement type – 632, delivery type – LR and no billing is necessary as the ownership of the goods does not change.

3. Depending on the business type, it may be necessary to have a mandatory reference for a consignment pick-up from a consignment fill-up order, which will restrict all pick ups without proper authorisation.

4. Indicate document flow in the copy control rules.

5. Like in any other returns process, a specific returns shipping point is suggested to be determined to bring the goods back from the consignee’s place to the plant.

6. No invoice is necessary, as the goods are not changing ownership. The goods issue is the trigger that transfers ownership from the business to the consignment consumer.

7. The standard schedule line category is F1, where the item is relevant for transfer of requirements and availability check is done on customer’s consignment.

8. Transaction flow – VA01 (CP) – VL01N (PGR) – after goods reciept if you proceed to stock overview screen, you will notice that the material available at the customers consignment has decreased by the quantity picked up.

Tax procedure remains the same as in any normal scenario.

thanksd

karthik

[Former Member]

Karthik,

I wish I could give you some points. Thanks for the well documented process. My all fundas of Consignment fiill up and issue are now clear.

Thanks a ton.