Internal Rental Overview

Introduction

When the owning division and the rental division belong to the same M3 BE company, internal rental functionality can be used, to create rental agreements in two steps. The scenario covered with this functionality is when one division, called owning division, is renting out equipment to another division, called rental division, and the rental division is renting out the equipment to a customer.

Owning division > Rental division > Customer

If the relationship is between two different facilities within the same division, you cannot create a rental agreement in two steps (both internal rental agreement and external rental agreement), because of the availability check.

In this case the functionality of cost and revenue split can be used, to share the cost and revenue between the two facilities related to the customer rental agreement. This is set up in 'Cost and Revenue Allocation Rules. Open' (STS040), 'Cost Exception Order Types. Define' (STS041), and 'Equipment. Connect Warehouse' (MMS295).

Availability

When you create an internal rental agreement, a check is done for other existing rental agreements, internal or external, within the same division for the same item and serial number, and for the same or an overlapping agreement period. If there are rental agreements matching these criteria, the line is set to status 04. The same check is done if serial number is set manually in 'Rental Agreement. Open Lines' (STS201).

If there is an external agreement already created on the rental division, it does not prevent the internal agreement from being created on the owning division. Also, an internal rental agreement on the owning division does not prevent an external agreement being created on the rental division.

The internal rental process

This diagram shows the internal rental process:

The process starts with a PO at the rental division. At this stage, the demand is not visible at the owning division. When the PO is printed and set to status 20-'Document printed and sent', a temporary rental agreement with a reference to the PO is created automatically in the owning division. The rental agreement lines are created with line type I to indicate that this is internal rental. When you activate the rental agreement, the PO of the rental division is automatically confirmed. If the PO type is configured to create a subline, this is also done at this stage.

When it is time to deliver, this is done by the owning division using the delivery DO connected to the internal rental agreement.

Goods are received at the rental division using the PO. As soon as the goods are received at the rental division, the delivery can be done to the end customer.

The owning division invoices the rental division using the internal rental agreement. The rental division uses the PO subline or a financial agreement, depending on configuration on PO type, to do the invoice matching.

The rental division invoices the external customer using the customer rental agreement.

When it is time to return the equipment to the owning division, this is done by the owning division using the return DO connected to the internal rental agreement. The return DO triggers a move of the equipment from the rental division's yard warehouse to the owning division's yard warehouse.