Vendor Consignment Process

 In this process Vendor kept his own material into our premises , it can be Plant or Warehouse.  Ownership of the said material remains in the vendor books only.Vendor Consignment Process in treated as Special Procurement in SAP.

When Company requires certain kind of product with a specific quantity Consignment Purchase Order has been raised and we withdraw material from vendor consignment stock for the use like Production or Sales or any Internal consumption. Inventory  gets transferred in the books of Company (Purchaser) after removing it from consignment stock. Afterwards , we have to settle liability for the said  withdrawed  material via Transaction code MRKO.

We can said the following features of Vendor Consignment Process:

Features of Vendor Consignment

• Inventory (Consignment stock) is only valuated after it is consumed or withdrawn.
• Price is maintained in the Purchase Info Record with Info Category as Consignment.
• Consignment material and unrestricted stock material numbers are same.
• Goods receipt is always non valuated.

There can be two different scenarios in Consignment Process.

1. After Goods Receipt Note (GRN) we can do stock transfer from plant to store consignment stock and can sell directly.
2. We can do Transfer posting to our own stock so that it appears as Unrestricted stock in our books and later we can sell it.

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Navigation Links :

To get idea of structure: SAP Enterprise Structure

To get knowledge of P2P Process: Procure to Pay Process

For Overview of the course: What is SAP

To refer subcontracting process:  Subcontracting Process in SAP MM

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