How do I add international freight and insurance costs to a material's price in SAP?

[nithin_pranesh]

Dear Experts,

We are having issues with processing international Purchase Orders (POs) in SAP. We need to create a single Purchase Requisition (PR) but use it to generate three separate POs: one for the materials, one for freight, and one for insurance. The primary challenge is ensuring the costs for freight and insurance are automatically added to the material's final price upon goods receipt. What is the correct configuration or process to handle this "landed cost" scenario while allowing for separate invoices from different vendors (material supplier, freight forwarder, and insurance company)

Best Regards,

Nithin Pranesh

[erickgoulardt]

Dear Colleague, hope you're fine. I'm adjusting the tags for better filter in the community. The experts will find your query and answer as soon as possible. If you need something, please let us know! Best Regards, Erick Goulardt, SAP Support.

[nithin_pranesh]

Dear Experts,

Any update on this?

Regards, 

Nithin Pranesh

[nithin_pranesh · Accepted solution]

Hello all,

We’ve found a practical workaround to address this scenario. Instead of generating three separate POs—one each for material, freight, and customs/insurance—we created a single international PO with two additional condition types for freight and insurance. At the creation stage, you’ll need to enter estimated amounts for these charges, as exact figures are usually unavailable upfront. You can assign a different supplier to each condition type.

When performing goods receipt (GRN), all costs (material, freight, insurance) are added to the material value. Afterwards, you can reference this single PO to create three separate supplier invoices, each corresponding to the appropriate supplier. Since the actual freight cost is often determined only at invoicing, you can use the unplanned delivery cost field to adjust the amount during invoice posting.

Pros:

All charges (including those from multiple suppliers) are included in the material value.

There’s no need to create multiple POs, even though the option to split POs isn’t available (based on current research).

Cons:

If you issue or sell the material before invoicing, any subsequent cost adjustment will not update the inventory ledger, but instead be posted to the price difference (expense) ledger.

For supplier communications, you’ll need to develop additional print forms to accommodate the new process.

Please refer to the following link for more clarification.

https://community.sap.com/t5/enterprise-resource-planning-blog-posts-by-sap/planned-delivery-cost-of...

Best Regards,

Nithin

[Lakshmipathi]

In Public Cloud, landed costs like freight and insurance cannot be managed via separate POs if you want them to roll into inventory. The recommended process is to create one PO for the material, then use the Manage Landed Costs app to capture freight and insurance charges and allocate them to the material. This way, you can still post separate invoices for each vendor, and the system will automatically update the material’s landed cost.

Freight and insurance costs should not be separate POs if the intent is to capitalize them into inventory. Instead record these costs as landed cost documents after goods receipt. Allocate them to the material based on quantity, weight, or value. Post supplier invoices separately for the freight forwarder and insurance company. The system will automatically adjust the inventory valuation (MAP or standard cost) so that the material reflects the full landed cost. This ensures:

• Separate invoices can still be processed for each vendor.
• Automatic landed cost capitalization into inventory.
• Compliance with Public Cloud standard processes (no custom ABAP, no shipment cost documents).

[nithin_pranesh]

@Lakshmipathi Can you please share the Firoi Apps library reference of that app. Best Regards, Nithin Pranesh