Procurement process..

[#1]

Hi all,

Please let me know what is meant by internal and external procurement,Extertnal domestic and import material etc.... If possible please explain the business process of each type.

Thanks & Regards

SAP MM User

[Former Member · Accepted solution]

Hi,

To be very simple & straight..

Internal Procurement: Procurement of goods/services within the same organization, maybe prodicung internally,procure from other plants/other dept. ect.

External Procurement:Procurement of goods/services from outside the organization, from vendor/supplier.on which organization becomes liable for the payment.

If your vendor/suplier is available locally then its Domestic/Local purchase on other hand if he is in abroad then it becomes import purchase.

reply for further info

Regds

[Former Member]

External procurement is when u source/purchase something from an external source like a vendor . This source is not a part of ur compnay in anu case. It is a different source all together

Internal procurement is when u source something within ur compnay - like purchasing material from another plant in ur organization.

[Former Member]

External Procurement means the documents which will generated for the external use like PO document for a vendor...

Internal procurement consist of documents which will show internal req., movements of materials etc, like Production order etc...

Hope it helps..

REgards

Priyanka.P

[Former Member]

If certain parts that are needed to make a product have to be bought in from a different company, you need to make use of the functions for external procurement. This type of procurement is also referred to as direct procurement

In the case of external processing or procurement, you need access to information from the purchasing department.

For example, you need to know about the vendor and the conditions that apply for external processing/procurement. This information is maintained in purchasing and can be entered in the external operation or non-stock component, for example, via a purchasing info record.

If you want to use external processing/procurement functions, you first need to make the corresponding settings in the Purchasing module.

Internal orders are normally used to plan, collect, and settle the costs of internal jobs and tasks. The SAP system enables you to monitor your internal orders throughout their entire life-cycle; from initial creation, through the planning and posting of all the actual costs, to the final settlement and archiving: