Create Purchase Organization for Pricing

This document shows how to define a purchase organization used in purchase pricing and how to create the necessary set up for using purchase organization for pricing in the purchase price search. Purchase organizations for pricing define which warehouses to allow to use the prices and terms of certain agreements.

Outcome

A purchase organization of type 0='Price' is created and connected to a warehouse on 'Warehouse. Open' (MMS005/E), and added to a new purchase agreement on 'Purchase Agreement. Open' (PPS100/E).

The purchase organization codes are stored in the PPPORG table.

Before you start

  • Purchase organization for pricing must be activated on 'Settings - Purchasing' (CRS780/H), parameter '66 - Use of purchase organization: Price/Planning', field 'Priority order for price search'.

  • A warehouse must exist in 'Warehouse. Open' (MMS005).

Using purchase organizations for pricing

Purchase organizations for pricing define which warehouses to allow to use the prices and terms of certain agreements. This is achieved by connecting the price purchase organizations to the warehouses and purchase agreements. The purchase organization to which the warehouse is connected, will be used for searching for a valid agreement in the purchase price determination. Prices from the agreement connected with the purchase organization of the warehouse are selected first in the search for price origin.

Purchase organizations for pricing can be used in the following programs:
  • 'Purchase Organization. Open' (PPS099)
  • 'Warehouse. Open' (MMS005)
  • 'Purchase Agreement. Open' (PPS100)

Use of the purchase organizations for pricing is limited to the general purchase agreements, blanket agreements, and delivery schedule agreements.

Global vs. Regional Purchase Agreements

Global Agreements

If the 'Purchase Organization' is empty on the agreement header, then the purchase agreement is valid for all warehouses within the company.

Regional Agreements

To create regionally applicable agreement, a purchase organization must be specified on the agreement header and all warehouses, that use the prices and conditions of the agreement, must be connected to the purchase organization in (MMS005).

Warehouses on different divisions can be connected to the same purchase organization.

Group ID on agreement lines

The group ID on agreement lines can define the objects for which the purchase agreement is valid in a more detailed way. Available combinations of objects are defined in 'Purchase Agreement Selection Field. Open' (CRS746).

Follow these steps

Create Purchase Organization for pricing

  1. Start (PPS099).
  2. Specify alphanumeric characters on the B panel.
  3. Select 'Create' to create a record.
  4. Select purchase organization type 0='Price' on the E panel and press 'Enter'.
  5. Specify the 'Description' and 'Name'.

Connect Purchase Organization to a warehouse

  1. Start (MMS005).
  2. Specify the purchase organization on the E panel. It must be a purchase organization of type 0='Price'.

Connect Purchase Organization to the purchase agreement

Purchase organization can only be selected when entering a new purchase agreement.

  1. Start (PPS100).
  2. Select 'Create' to create a record.
  3. Specify the purchase organization for pricing on the E panel. It must be a purchase organization of type 0='Price'.

Parameters to set

Program ID/ Panel Field The field indicates …
(PPS099/B) Purchase Organization

...the purchase organization groups warehouses for the use of purchase price agreements or purchase order planning. The field is defined in (PPS099). The purchase organization type determines the purpose of the purchase organization purchase pricing or planning.

Purchase organizations used for pricing are connected to the warehouses in (MMS005) and purchase agreements in (PPS100). Purchase organizations for pricing are used for defining which warehouses to allow to use the prices and terms of certain agreements. Purchase organizations for pricing are limited to normal purchase agreements, blanket agreements, and delivery schedule agreements.

Purchase organizations used for planning are connected to the warehouses in (PPS199) and assigned to the planned purchase orders and purchase orders. Planned purchase orders that are connected to the same purchase organization can be consolidated to create cross-facility purchase orders for central buying. Purchase organizations for planning are limited to the purchase orders of the purchase categories 20='Normal' and 70='Subcontracting'.

To activate the purchase organization for use in purchase pricing or purchase planning, set the '66 Use of purchase organization: Price/Planning' parameter in (CRS780).
(PPS099/E) Purchase organization type

...the purchase organization type, which determines the use of the purchase organization.

Alternatives:
  • 0='Price'
  • 1='Planning'

Type 0='Price' purchase organizations create price purchase organizations that are used for the grouping of warehouses that share regionally, or centrally negotiated purchase price agreements. The price purchase organizations are connected to warehouses in (MMS005) and purchase agreements in (PPS100). To activate the use of type 0 purchase organizations in the price origin search, use the '66 Use of purchase organization: Price/Planning' parameter on (CRS780/H).

Type 1='Planning' purchase organizations are used for the grouping of warehouses for purchase planning and consolidation. Purchase organizations of type 1 are connected to the warehouses in (PPS199) and assigned to the planned purchase orders and purchase orders. The type 1 can only be created (and is mandatory) if the use of the purchase organizations for planning is activated on (CRS780/H).
(PPS099/E) Description … the description of the current identity. It is a mandatory information.
(PPS099/E) Name ...the name of the current identity. When you edit descriptions and names and no name is specified, the first 15 positions from the description are treated as the name by default.
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