The simple flow is like below.
Global Contract (Agreement with vendor for total quantity or amount) --> Purchase Orders (for the requirement) --> Good Receipts --> Vendor Invoices (Vendor will submit invoice for payment) --> Invoice Verification (Submitted invoices will be verified and payment will be sent to the Vendor).
Here, at the time of Global contract creation, a pricing condition for Freight will be added in the contract. When you create purchase order (PO), the pricing for Freight will be flown from the contract and so on.
For example, 100 quantities are decided in the Global contract and per quantity the freight is $10 then total freight will be $1000. When you create PO for 25 quantities, freight will be determined based on Global Contract and automatically freight will be calculated as 25 * 10 = $2500. When the Freight owner sends the invoice, it will get paid. This is the payment process.
I tried to explain in simple words, but you can refer the SAP documentation for details.
Hope, it helps.
Regards
Viswa
(Please assign points for the helpful answers).
Bluesky
