Logistic service providers (LSP) - packaging item registration

Logistic service providers (LSP) are handled as a separate VMI consignment type of warehouse in LN Warehousing. Ownership of inventory rests with the supplier.

Note

  • The logging of packaging item transactions at the moment of consumption by the customer is not based on consumed stock point information from the VMI/LSP warehouse. Packaging material transactions must be logged separately from the regular item consumptions, and are processed during the processing of sales consumptions.

In an LSP-based scenario, the consumption messages to the supplier are always sent by the LSP and never by the end customer (OEM).

Prerequisites

LN records the packaging item transactions only when the following occurs:

Important!

There are two LSP scenarios in which LN receives the consumption messages and updates associated packaging accounts:

  • The LSP (VMI) warehouse is directed/managed by and probably located at the customer's site.

  • The LSP (VMI) warehouse is directed by a third party, possibly closely related to the supplier.

To indicate the applicable scenario, the Update Shipping Material Account during field in the Warehouses (whwmd2500m000) session presents you with the following choices:

  • Shipment to VMI Warehouse: Use when the LSP warehouse is managed by the customer.
  • Consumption by Customer: Use when the LSP warehouse is directed by the supplier or a closely related third party.
Usage of option Shipment to VMI Warehouse- Scenarios

You must use the Shipment to VMI Warehouse option when the following occurs:

  • When the shipping material accounts must be updated when the goods leave the warehouse of the supplier to be shipped to the VMI (LSP) warehouse. In LN, the sales transfer orders are used for this VMI scenario to deliver the goods from a supplier warehouse to a VMI warehouse (LSP).

  • When the shipping material account must be updated when the consumption messages sent by the LSP never contain packaging information. The shipping material accounts must be updated when goods are shipped (transferred) from the supplier warehouse to the LSP warehouse.

Usage of option Consumption by Customer- Scenarios

You must use the Consumption by Customer option when the following occurs:

  • Shipping material accounts must be updated when the consumption, by the customer/OEM, is processed.

  • The consumption message sent by the LSP (to the supplier) must contain all the necessary packaging information.

The Update Shipping Material Account during field on the ship-to VMI (LSP) warehouse, (to which goods are transferred) determines which scenario applies.

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