If the company has a make-to-order strategy, the receipt of a customer order will trigger the need to produce materials. The outcome of this step is a planned order.
A transaction that causes a change in stock (value or status) - Four specific movement types - Goods movement will always result in the creation of a material document - A financial accounting document can result if there is a valuation (i.e.inventory) change
A material document records data related to a goods movement, such as when goods are received from a vendor. It consists of a header and one or more items. The header includes the material document number, the date, the name of person who created the document, and the source of the document.
Sales area is a combination of sales organization, distribution channel, & division. Sales organization is responsible for sale & distribution of goods & services for a particular area. Distribution channel is the means by which a company delivers its goods and services to its customers; for example, wholesale or retail. A division is typically used by companies to consolidate materials with similar characteristics within a unit. These materials are usually associated with a product line.
Organizational levels relevant to the procurement process include client, company code, and plant. A client represents an enterprise that is comprised of many companies or subsidiaries, each of which is represented by a company code. A plant is the location where the materials are received.
trigger is a request from other processes or it can be determined manually. The required data are master data and user input. The fundamental task is to create a purchase requisition. This is also the key outcome.
A purchasing manager receives many requisitions for the same materials & consolidates them into a single PO & sends order to one vendor, perhaps to take advantage of volume discounts. In this scenario multiple requisitions are combined into a single PO. Alternatively, a single requisition may include a number of different materials that must be purchased from different vendors. In this case, the purchasing manager creates a different PO for each vendor that includes the relevant materials.