Saturday, 11 June 2016

Physical Inventory

Entering the Counting Results

In the following topic, I will show you how you can enter the counting results in the physical inventory document.
The process is fairly easy, but it needs to be accurately executed because the error in entering the counting results in poor stock balances later. So, there is high need that the counting process as well as entering process both be accurate.
Step 1)
  1. Execute the transaction code MI04.
  2. Enter physical document number and fiscal year.
  3. Enter the counting date if it differs from the one suggested.
  4. Enter the variance percentage. This means that if you had 100 pcs on stock before the physical inventory process, and you enter 107 pieces as a counting result, you will be informed with a warning message of the difference between the previous stock quantity and the counted quantity.
    Press ENTER.
Step 2)
  1. Enter the quantity that is counted for this material.
  2. Press ENTER.
You will be informed that there is a quantity difference of 20 pcs, if you haven't made a mistake while entering the quantity, you can bypass the warning by pressing ENTER. If you made a mistake while entering the quantity, you can correct the entry (124 pcs in my case) and hit ENTER again.
If you get the warning message, and you think that there might be a mistake in the counting process, you can recount the item again and correct the results (check out MI05 transaction code, and MI11 if needed).
After I have corrected my entry to 124 pcs, I will save the transaction data.

Posting the Differences

After you have possibly recounted and reentered quantity information for problematic materials, you can post the differences by using the transaction MI07.
Step 1)
  1. Execute the transaction MI07.
  2. Enter your physical inventory and fiscal year.
  3. Enter posting date. Goods posting will be done according to this date. Some companies use 31.12. In the annual physical inventory as the last day of fiscal year.
  4. You can use the threshold value to enter the maximum allowed differences value in local currency. If you don't want a limit leave this field blank. In order for this to work, materials need to have the standard or variable price maintained.
  5. Press ENTER.
Step 2)
  1. You can see the difference quantity. This means that we have found 4 pieces more than it was previously stated in the system.
  2. Value isn't shown as our controlling/accounting department didn't yet release the prices for this material.This needs to be done in a production environment. You cannot post a difference of 4 pieces with the respective value of 0,00 Eur.
We can see that our posting is done by creating the resulting material document 4900547510.
Step 3)
We can check the material document in MB03.
  1. We can see a quantity of 4 pcs in the material document.
  2. Movement type used for goods receipt from physical inventory difference posting is 701.
This means that 4 pieces are added to the inventory.
For a reference of standard movement types, used for physical inventory, see the below table.
  • 701 – Goods Receipt for unrestricted stock
  • 702 – Goods Issue for unrestricted stock
  • 703 – Goods Receipt for quality inspection stock
  • 704 – Goods Issue for quality inspection stock
  • 707 – Goods Receipt for blocked stock
  • 708 – Goods Issue for blocked stock
You are done with physical inventory. You can now continue with regular warehouse activities.

Wednesday, 8 June 2016

Transfer Posting Of Goods

Transferring a quantity from one storage location to another can be accomplished by either using MIGO transaction or MB1B.
I will demonstrate the transfer posting process using MB1B as you have already seen MIGO in action.
Step 1)
  1. Execute the transaction MB1B.
  2. Enter movement type (311), source Plant and Storage location. HitENTER.
Step 2)Enter receiving storage location,
  1. material number,
  2. quantity,
  3. unit of measure.
Save the document and the transfer posting will be completed.
The material document number is assigned.
If you need to cancel this posting, you can use either MBST or MIGO transaction.

Tuesday, 7 June 2016

How To Issue Goods

Another important process in inventory management is goods issue posting. Reservations are considered a specific process on their own, but essentially reservation use a goods issue logic. When we created a material document for reservations, we have issued goods from warehouse to the cost center, production order etc.
Now, we can talk about other goods issuing processes. The most important of all is for outbound delivery. The process works as follows -
  1. We have an inbound delivery for our material 10599999 incoming from sales department.
  2. After the goods are loaded in the truck we should do a goods issue posting for the delivery.
  3. We are sent the delivery number 80072673 created for out material 10599999 and we need to process the delivery in inventory management by posting the goods issue.
It is done in sales transaction VL02N mostly used by the MM users in logistics. Departments that use this transaction can vary depending on the organizational structure in the company.
Step 1)
  1. Open VL02N transaction.
  2. Enter the delivery number you need to process.Hit ENTER.
Step 2)
  1. Enter the Plant and Storage Location.
  2. Enter picked quantity. If full quantity has been picked and loaded, enter 20 PCS but if for some reason loaded quantity is 12 PCS (e.g. truck already full) you will enter 12 in Deliv. Qty field and in the Picked Qty fields.
  3. Post Goods Issue.
You are done
If for some reason you need to reverse/cancel goods issue for outbound delivery, you can use the transaction VL09.
  1. Execute transaction VL09.
  2. Enter the appropriate delivery number.
  3. Press the execute button.As you can see, you can use this function for inbound deliveries too.
Step 2)
  1. Select the line with the delivery you want to process.
Confirm if asked. If you get the message that the goods issue is reversed successfully, you are done.
If not, there's a problem in the processing which has to be identified by superuser or consultant.
Other types of processes where posting a goods issue is needed
You can see the MIGO transaction for reference to more options for posting a goods issue.
Choose A07 - goods issue, and in the next drop-down menu you will find several options. To give you a little "homework", you can explore the options by yourself, here's just a short look on them.
  • R02 - Material Document (post goods issue for a material document)
  • R08 - Order (post goods issue for a production order)
  • R10 - Other (without the reference document)
  • R01 - Purchase Order (PGI for a purchase order)
  • R09 - Reservation (PGI for reservation – I have demonstrated this process by using MB1C transaction)

Monday, 6 June 2016

How To Cancel Goods Receipt

After you have posted the goods receipt in MIGO, you can check stock levels in MMBE transaction code.
  1. Execute the transaction.
  2. For the requested material you will be shown stock levels for plants, storage locations and stock types (unrestricted, quality, blocked).
  3. In the Quality inspection column, you can see that our material is posted there 2 PAL = 24 PCS.We also have unrestricted stock from some of the previous receipts.
Let's say that we have made a mistake, we wanted in this special case, our material to be posted directly to unrestricted stock. Therefore, we need to cancel the posting to reverse the process and do it again properly.
We can use MIGO transaction to cancel a posting.
Step 1)
Choose A03 CancellationR02 Material document, enter the material document that has been created after posting the goods receipt from purchase order. Execute.
Step 2)
  1. Check the indicator that item is OK.
  2. Post.
Step 3)
Check in MMBE if our goods receipt cancellation is in effect. As you can see, the quality inspection column is empty. It means that we have successfully reversed/cancelled our goods receipt posting.
It also means that we can use the purchase order number in MIGO to post the goods receipt again, this time with the correct settings.

Friday, 3 June 2016

Overview of Inventory Management

Inventory management is used to manage the inventory for the goods. It is based on several key processes. Definition of movement types, reservations, goods issue and goods receipt.
We have already done basic goods receipt process in the purchase order topic, referencing it to a PO.
There are a number of functions and transactions used in the Inventory management processes, and we will cover the most important in this tutorial.

Movement types

Movement types are used as indicators of what is the purpose of the goods movement (e.g. from storage location to a storage location, receipt from purchase order, issue for the delivery, receipt from production).
Movement types have its predefined settings in standard SAP system, and they can be customized according to your needs.
Also, you could use the same movement type for different processes if you use movement indicators properly. For example, movement type 101 with movement indicator B is used for goods receipt from purchase order. The same movement type 101 with movement indicator F is used for production order goods receipt.
You can see on the next screen how the movement type maintenance screen looks.
Huge number of options are available to set up the movement type properly, and it's access by the OMJJ transaction code.
  1. Execute OMJJ transaction, and on the initial screen choose Movement type, on the next screen enter the movement type range you wish to edit.You will be presented a screen that looks like the next screen.
  2. You can see a dialog structure on the left. These options are used for setting up our movement types according to our needs.
  3. When you select any of the options the details screen on the right is updated with settings for that node.
This is not in a scope of this tutorial, as configuring the movement type requires extremely deep knowledge of the processes in MM module (inventory management component).
You just need to understand for now what does the movement type, and movement indicator represent.
Feel free to take a tour around the OMJJ transaction to get a bit more insight on the actual setting that can be made on movement type, and movement type/movement indicator level.
To summarize the lesson, movement types are used for distinction how the goods will be moved in our inventory.
For example,
  • We will set up our movement type 101 to be used for goods receipt.
  • Movement type 311 to be used for stock transfer from one storage location to another in one step.
  • Movement type 601 for goods issue for outbound delivery..
Another thing to know is that every movement type needs to have a reversal movement type defined (if we need to cancel 311 we have to define 312 as a reversal movement type, 101 => 102601 => 602).Material document Material document is a document in SAP that contains information on processing of goods movements (receipt, issue, transfer).
When you create a material document you are actually moving stock quantity in a certain way as defined by movement type.
If movement type 311 is stated in the material document, material will be transferred from one location to another (transfer process). If it's 101, material document will not have a source storage location but will have a destination (receipt process). If it's movement type 601, material document will only have source storage location but will not have a destination (issue process).