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Advantages of a reference purchasing organization?

Former Member
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Hi there,

Can somebody explain the Advantages of a reference purchasing organization.

when and where it should be recommended.

also what are the differences when it comes to the assignment is SAP?

thanks and regards

Accepted Solutions (1)

Accepted Solutions (1)

Former Member
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dear Rajiv

Example: Working with Reference Purchasing Organizations

The reference purchasing organization RORG, which belongs to head office in Atlanta, has negotiated a comprehensive contract for the material Steel bolt 01 with favorable conditions with

vendor Smith Corp.

The purchasing organization EORG, responsible for procurement in the Houston and Austin plants, wants to issue release orders for the material Steel bolt 01 against this contract.

Purchasing organization EORG procures other consumable materials from regional suppliers.


Before the purchasing organization EORG can issue release orders against the above contract,

the following settings and data must have been maintained:

Maintaining Customizing Settings

Both purchasing organizations are maintained in Customizing for the Enterprise Structure

under Definition Materials Management Maintain Purchasing Organization.

- The reference purchasing organization RORG can be maintained with or without a company

code and plant(s).

- The purchasing organization EORG is assigned to company code 1000 and the two plants.

Purchasing organization RORG is maintained as the reference purchasing organization for

the purchasing organization EORG in Customizing for the Enterprise Structure (

Assignment Materials Management Assign Purch. Organization to Reference Purch.


Entering Application and Master Data

The vendor Smith Corp. is maintained for both purchasing organizations.

The material Steel bolt 01 is maintained for the plants Houston and Austin.

A centrally agreed contract has been created without a plant by the reference purchasing

organization RORG.

Reward points if helpful

Thanks and regards

Ravikant Dewangan

Former Member
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Hi Rajiv

Your answer is very useful, especially with the example. I am trying to set up just such a scenario in ECC 6.0 and - to relate to your example - am finding that the source list for material Steel bolt 01 in plant Houston is not picking up the RORG centrally agreed contract.

Is there not some partner assignment or vendor hierarchy also required for the Smith Corp vendor or the RORG central contract?

Many thanks


Answers (2)

Answers (2)

Former Member
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Ref. purchasing org is useful in case if u r following corporate wide purchasing i.e A purchasing organization procures for all the company codes belonging to a client.

In this case you can procure material through this purch org for all plants under a client. for this you need to assign purch org of comp. code to ref. purch. org then through single purch org you can carryout procurement

reward points if helpful



Former Member
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Refernce Purchase org. helps to work with conditions and contract release orders on a cross-purchasing-organization basis.


The conditions of a reference purchasing organization can be used by other purchasing organizations for the purpose of price determination

It allows Several purchasing organizations to access the contracts of a certain reference purchasing organization

In SAP you can assign several purchasing organizations to one reference purchasing organization, but each individual purchasing organization should be assigned to just one reference purchasing organization.