Settings for Central Procurement

Outcome

An understanding of the setup required to activate central procurement in M3 BE.

Before you start

No special settings required.

Enable Central Procurement in company

The activation or deactivation of the central procurement is done on company level and applies for all divisions within the company.

Start 'Settings – Purchasing' (CRS780).
On panel H, set parameter '66 Use of purchase organization: Price/Planning' to 1='Yes', field 'Use purchase organization for planning'.

Activating the parameter has this effect:

'Purchase organization' of type 1='Planning' can be created in 'Purchase Organization. Open' (PPS099).
The 'Purchase organization' field is available on planned purchase orders or orders, and batch purchase orders, and is mandatory for purchase order categories 20='Normal' and 70='Subcontracting'.
Purchase orders with category 10='Inquiry' are assigned to a purchase organization when created from 'Purchase Inquiry. Create for Planned PO' (PPS173).
Purchase orders with purchase order lines for multiple facilities can be created if a purchase organization configured for central buying is used when creating a planned purchase order or a purchase order.
The buying facility from a purchase organization of type 1='Planning' can be used as the facility for planned purchase orders and purchase order headers. The buying facility represents the central purchase department that manages the purchase order.
'Purchase organization' and 'Country' are available as consolidation objects in 'PO Consolidation Group. Open' (PPS019).

Create facilities

A facility must be created in 'Facility. Open' (CRS008) to represent the facility of the central purchasing department. With this facility, central buyers create and manage planned purchase orders and purchase orders. No special set up is required for the facility. The facility is connected to a purchase organization in (PPS099).

Create purchase organizations

At least one purchase organization for planning must be created in (PPS099) and configured for use in central buying. It must have a purchase organization of type 1='Planning' and the buying facility that is created to represent the central purchase department.

If there is a requirement to do local procurement in the company, a purchase organization of type 1='Planning' with blank 'Buying facility' must be created. This purchase organization can be used for local buying.

Connect warehouses to the purchase organizations

The purchase organizations must be connected to the warehouses in 'Purchase Organization. Connect Warehouse' (PPS199). This connection defines for which warehouses a purchase organization can buy.

One purchase organization can be assigned as the 'default purchase organization' for a warehouse.

Exceptions to the use of the default purchase organization can be defined in 'Purchase Organization Selection. Open' (PPS198).

Create rules for purchase order selection

An object control table, where rules for assigning purchase organizations to planned purchase orders are based on item or warehouse related information, can optionally be created in (PPS198). The rules are based on objects related to 'item' or 'warehouse'. Defined rules overrides the use of default purchase organization in (PPS199) for assigning purchase organization to a planned purchase order.

PO consolidation group

A PO consolidation group that uses 'Purchase organization' and 'Country' as consolidation objects, must be created in (PPS019).

Purchase authority

If purchase authority is used for managing access to facilities in 'Purchase Authority. Open' (PPS235), it is recommended that central buyers have an access granted to all facilities for which they manage procurement activities.