Vendor Consignment

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Vendor Consignment Process Explanation and Demo on SAP S4HANA ERP

today i will explain the meaning of consignment in general then i will go into the details of ,the vendor consignment process and i will run a full demo on the SAP S4HANA,i have been doing these videos for a little more than two years now and i'm almost at 14 ,000 subscribers and i have published more than 100 videos and i never actually imagined the ,amount of effort and time i will be able to put in this channel i really enjoy doing these videos ,but still keeping this channel running requires a lot of time and effort so i really need your ,support if you like the content you see in this channel then please share subscribe comment ,like and also if you would like to support the channel financially you can find a link to my ,patreon page in the description of the youtube video thank you and i hope you enjoy watching this ,one to understand the meaning of consignment let's take a very simple example we have a company that ,produces chairs and we always have a need for wood since this is one of the main components we use in ,our production so we made a deal with our supplier to transport a big amount of wood into our storage ,location without selling the stock to us so the owner of this stock is still the supplier but ,we have the right to use the stock in our production or for any other reasons ,whenever we want and once we consume or use this stock we are going to post the financial entries ,for the goods receipt and the goods issue at the same time and after a period a week or a month as ,we agree with the supplier we are going to count the full amount of wood that we used and we are ,going to post a supplier invoice for the total amount this is called the consignment process ,the wood inventory is called the consignment inventory and the supplier is called the consignor ,and the customer or our company is called the consignee now as you see in this situation ,the consignee is happy since we can guarantee that we will have continuous supply of raw materials ,the consignor is happy since he can guarantee that we will always use his raw materials and we are ,not going to look for other suppliers and so it is a win-win situation and there are many advantages ,and disadvantages to the consignment which is not the topic of our video today ,so if we look into this process in sap it is divided into two completely separate processes ,the part of the vendor the supplier providing the stock to another company is called the customer ,consignment and the part of the consignee or the customer taking stock from the supplier is ,called the vendor consignments so today we are going to assume that we are the chairs company ,the customer or the consignee and we are going to obtain consignment inventory from our supplier who ,will be the consignor so today i will go into the details of the vendor consignment process ,so the first step is to agree with our supplier to transfer the stock to our storage loc

The above is a brief introduction to Vendor Consignment

Let's move on to the first section of Vendor Consignment

SAP Vendor Consignment Process

Do you know how to manage vendor consignment process on sap?,Are you aware of all these tips and tricks?,Have you seen my last video?,you will find a complete demo about subcontracting process,check it out. If you don't want to miss any of these videos again,please subscribe to my channel and turn notifications on,In consignment process the vendor provides material,that you store in your facilities but the vendor is still the legal owner,of the stock until you withdraw the stock from consignment stores,this can happen in two ways, 1. if you make a,consumption from the consignment stock from your unrestricted stock,or 2. when you transfer your consignment stock to your own stock,only in that moment a liability to the vendor is created,and an invoice can be generated,now it's time to jump into the system so let's take a time to review our Master Data,so let's start with Material Master,here we have a raw material and let's see,what fields are relevant for our scenario,so first of all we are setting up automatic POs,because we are going to use this functionality,and then in MRP 1 view we have lot for lot 'EX' Lot Size,Procurement Type 'F' External Procurement and Special Procurement Type,10 that is pointed to Consignment this will allow us to create,automatically assigned Requisitions when we run MRP,and also in MRP 2 view,I set up a Strategy Group make to stock to 10 so we can create independent,requirements for planning purposes,so this is our material master now let's take a look at our Vendor Master,this is pretty much standard our vendor has to be created,in the company code and in our purchasing organization so vendor is 1111,company code is 1000,purchasing organization is also 1000 and and here we also set,up the automatic purchase order flag this one and the one,the material master are necessary to run,the automatic PO creation,what else, then we have to create Inforecord,for our Vendor and our Material in our Purchasing Org. and Plant,and this will be Inforecord category Consignment,here we will set up our price and it's important to have,also the tax code because our invoices will be created in,the background it is also necessary to have a source,list so material in plant 1000 we have our,Source List that is fixed to our vendor,and with indicator 1 it has MRP relevant,and the last part is the output conditions,we will need to,create our condition records, Output type,KONS this is the consignment invoice invoice verification so we have our key,Company Code and Vendor so for our records we have this one,okay it's already created and it will be automatically determined in the future,so this is our Master Data review,now that we have our master data in place,let's start with our process for that first let's check our stock,our material in our plant 1000,we can see there is no stock,so let's go to MD04 that is the Requirements list,we will see that we don't have anything no not even any requirement,for that then we can create an independent req

After seeing the first section, I believe you have a general understanding of Vendor Consignment

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SAP S/4 HANA Vendor Consignment Process | Vikram Fotani | Gaurav Learning Solutions

any questions,okay what i'll do now is,we i understood yesterday two scenarios,service was a little bit pending so we,completed now,so yesterday we understood,subcontracting and we now understood,services,there is once more special scenario,called as consignment,okay we already know what is consignment,we discussed multiple times but let's,see the practical example of how,consignment process,works in sap so when it comes to,consignment how it is different,than the other processes,how consignment process is different,than the other normal material,procurement,in conseguent the consignment material,basically belongs to the vendor,but it will we will keep it in your,premise but it will belong to,the vendor only and,there will no there won't be any ir that,will get posted because,what will happen it will get posted only,when you will be consuming that stock on,the consignment stock,then only it will show as a liability,for your vendor,you have to prepare the consignment info,record and the item category will be,okay,all right let's assume i have a material,okay which i want to buy under the,consignment i don't want to buy this,material and i don't want,to own i will ask vendor to send some,material,but i will book the liability of this,material only when i consume that,material,okay so in that case what we need to do,is first of all let me try to create a,new material,so that we are not getting confused with,the existing materials that we have,so i am saying rech dash consignment,okay i am just creating this material,industry sector i will say,whatever it is it will not make any,difference so chemical industry material,type,let's say this is trading good,okay let me press enter so i'm,maintaining basic data one basic data,two,purchasing is also fine what else,yeah i think this much is enough if we,require anything we will come back,so this is my consignment material i,just select this,unit of measurement let's say it is each,material group whatever you want to,provide,okay gross weight net weight we don't,need to worry,i'm providing the valuation class okay,so for,our trading goods normally we provide,the valuation class is 3100,okay let me try to save it now i know,that this particular material is,normally provided to me,by a particular vendor okay and this,vendor charges me for example,this vendor charges me a particular,amount but that amount will be charged,only when,i will consume that material so if i,want to use this kind of process,i need to create a purchase info record,for the category as consignment okay,which means i have to create a,purchasing for record i will go to,transaction me11,and here what i need to do is i need to,tell the system which vendor provides me,this material,okay under the consignment okay so for,this particular purchase organization,rc01,for this particular plant i want to,maintain the info record,so let me press enter okay so what i'll,do is i'll just maintain the information,which is related to my combination of,mat

After seeing the second section, I believe you have a general understanding of Vendor Consignment

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06.5) Vendor Consignment PO and processing- SAP MM- (ECC / S4 HANA). #sap #sapmm #sapmmtraining

hi all welcome to this initiation of,sapm hope you are enjoying Sap videos in,today's video I will cover Consignment,process in sap mm it is also known as,vendor consignment,before going further if you haven't,subscribed to my Channel 8 please kindly,subscribe my channel also like and share,video with your sap friends,now what is vendor consignment,it means you can order goods from,external vendors as a vendor Consignment,Goods you carry the goods in the vendor,Consignment stock in your site it means,store or Warehouse,but they Remain the property of external,vendor and it's not belonged to you at,all,vendor Consignment process in sap is,used when vendor provides your company,of materials on loan,letter when materials are required for,processing you withdraw the material,from the warehouse or store and the,liability is created for the vendor,which is settled through the special,payment process,in natural vendor Consignment means,Goods lie in your store or premises,however the owner of that Goods still,vendor but you have authority to use,that Goods as an invent required but,when we use the goods you have to pay to,the particular vendor,so here we will see how exactly process,works,consider vendor or it may be the company,third party company,they keep their goods,or material in your company store or,Warehouse,but when you want to consume that Goods,then,you take stock that is required,and you pay to the vendor for that stock,only,we will see one example here let's say,you have 10 bikes in your stock of a,third party vendor or maybe in your,showroom,and now you go to order sales order for,one bike or you got one consumer or,customer for one bike so what you will,do you will take one bike and you will,pay to the vendor for one bike only,although,10 bikes are you know stock but still,owner of that stock is vendor or third,party company not you but for this one,bike you will be the owner as you took,that in your stock now we will see,Consignment process in sap how it goes,first I will explain,here and same time I will process in sap,for vendor Consignment there is a,prerequisite we have to maintain,material master and vendor master in sap,so the material that is a consignment,material and the vendor or company that,is a third party who is providing you,the goods,for now I have prepared,this material,and vendor for our practice to use in,this video so this is the material and,this is vendor I'm going to use then,next what we do we create purchasing,info record for the combination of,vendor and material in me11 so I will go,in system and I will maintain that info,record,so to decode for info record is m e 11,run the T code,what is my vendor then,this is the my material I will use,this material then purchasing,organization,appropriate plant,and this is the most important info,category so here here I will select,consignment,always note here to select Consignment,as we are creating this info record for,consignment,then maintain all required data as you,kno

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Vendor Consignment Stock Procurement process

today we are going to discussing about,the conjoined process,select the document type,this is our document type,and select our,category for consignment,okay,what is our material our double zero,three yeah,let's see consignment count 100,this is our plant this is our storage,location and click enter,so when we click enter,the required details go to the source of,supply tab,the required,click the ascend source of supply,so the required details will be copied,from infrared card,and will ascend to the source of,software okay,now,save the,purchase requisition consignment,purchase requisition,this,one,w00962 is our,containment people,okay,going to creating people,just select our document type,go to the document overview on button,and click on variant,and click on my purchase requisitions,so that our latest purchase requisition,is double 0.00962,click on that and adapt details from,purchase requisition to,purchase order okay,so that all details will copy from,purchase requisition to,people,now,if you observe here there is no price,see it is in display mode,there is no invoice tab okay that means,we are not going to procuring any,material,that means,vendor is going to place is stock in our,plan premises,whenever we are,required we are going to,have a requirement in our plant we have,a requirement never planned,based on the stock requirement,we are going to taking the required,stock from vendor consumption stock,it will always it will shows in our,plant only but it will show as a vendor,stock not our,plant and understood the stock okay,45 double seven power is the,consignment pivot,mig,okay,now go to the goods received,select the goods receipt,and,this is our,okay,the pivot number,we go,double seven four,number seven four,is our consent p,okay,if you see here go to the weight tab and,see the moment i,that is one not one k that means,g r for consignment strong okay,so whenever we complete this g or,here stock will come to the,plant as a vendor stock okay,now go to the mmbe,before we posting the gr consignment gr,okay environment pog here we will check,this talk with,how much stock we have as a con vendor,stock in our plan,vendor conservation stock we have as,50,okay now we are going to posting one,more hundred,okay,just item okay,item okay,and pause the document,while posting the 1.1k,uh,we do not have any accompaniment okay,now go to the display document,click enter,and,in document info click away document,you will get,there is no created accounting document,because,we are not going to receiving,as a plant star we are going to receive,as a vendor star stock belongs to the,vendor only,we do not have any,any this thing,any right on that vendor stock okay as a,vendor stock vendor is going to keeping,his stock in our plan premises,whenever we are going to,procure we are going to take the stock,required stock from that vendor stock,and we are going to utilizing that okay,that is the process now,go to the mmbe and see the,stop 50 now we have just refresh it,you

After seeing the fourth section, I believe you have a general understanding of Vendor Consignment

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Consignment - Whiteboard Wednesday

I welcome to this whiteboard Wednesday,I'm James Shores future chief marketing,officer here at fishbowl let's talk,about consignment pretty basic principle,essentially you as a supplier have your,goods in another store,another small outlet but they haven't,purchased it yet so most of the risk is,on you but there's a lot of good things,that you can do with this as long as you,know how to track and manage them,appropriately so let's take a look real,fast as you as a supplier so let's just,as an example it's gonna be different,for everyone but let's say you kind of,have three typical products that you,have so you have your basic products,it's kind of what you got started with,that everyone goes to four and then,maybe you have a new product line that,you're wanting to test out or break out,into other markets and maybe you also,have kind of your high-end expensive,line it's very specific it's perhaps,even custom-made now one of the benefits,of consignment is let's say you're,trying to get into a large chain we have,a couple customers where they use the,same principle consignment so that they,can help get their product into a larger,chain which helps get them into the,market get their name out there but then,also there's a little more risk on their,side and so they have to be able to,track these things but by getting that,basic product into this large chain they,get their name known and they're also,expanding their potential market but,then there's also the other side of you,might have just individual mom pop kind,of stores places where it's just local,to you and some of that might be,specific in their own clientele so you,might have a shop where again it's just,your basic product that you have their,own consignment or it could be a little,bit fancier store has a new market that,you're trying to branch out with your,own new product line and they want to,carry that or there might even be a,fancier place in town that sells,higher-end wares hiring goods that you,can try to sell your more expensive,offerings again all-in consignment so,here's where,the meth really comes into play because,you need to know how much and where all,these products are especially if you're,spread across a few different places a,few different chains you need to know,where all this is because if you're not,tracking it odds are they're probably,not tracking it as well either so you,need to make sure with consignment the,whole point is that you can try out some,of these new products to get into new,markets new exposure and you can also,try to create your own different lines,well I'm also offering different bases,of what you produce or what you supply,so from the tracking side some really,important things to make sure that you,are aware of is the agreements that you,have between individual stores even the,larger chains the agreements can be,anything from how long you're going to,carry that product till it has to be,returned if a customer returns something,who pays for that cost if the

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Dynamics Unplugged - Vendor Consignment in D365 F&SCM

welcome welcome welcome welcome back to,dynamics unplugged today we're going to,be talking about vendor consignment,inventory in dynamics 365 finance and,operations and supply chain management,this is actually not really a new topic,it's a feature and functionality that's,been around for quite some time but,under discussed and perhaps,underutilized in in dynamics i'm here to,kind of walk through how to set this up,and the process and maybe caveats around,it that could affect your business,processes so first things first we're,going to actually go ahead and create a,or,enable a vendor for the vendor,consignment process,so if we go to inventory management,we'll see under the setup we have under,dimensions inventory owners inventory,owners are essentially,who we do consignment with who are the,owners who are our vendors,and then finally a default record,created named after our legal entity so,that when the transfer of ownership,happens from vendor consignment to us,because we need to consume we need to,use in production or we need to ship,that inventory we can do that and,transfer that ownership,i've gone ahead and created a vendor,and added them here as an owner so if,you click new you actually have the,listing of all your vendor accounts you,select your vendor,and then it automatically populates the,owner id as their vendor account code,you can change that if you want if you,want to use the naming convention,instead so it's a little bit easier to,identify rather than the vendor id code,today we're going to be using this,granite distillery this is a new vendor,we've added to sell us bourbon soaked,barrels that we can brew our beer in and,we're going to take those off on a,consignment process so our vendors now,set up,the next thing i need to do is check my,warehouse and this is really important i,would recommend that you typically have,a separate warehouse for consigned,inventory even if it physically is in,the same warehouse,and the reason for that is,well there are multiple reasons actually,number one is the consignment process,the consignment replenishment order,you'll see that when i go to create that,later and,bring the inventory physically into,stock under consignment cannot happen,into a wms enabled warehouse so if your,company is using warehouse management,you would at the very least need a,separate non-wms warehouse,where the,use warehouse management processes,button is unchecked,so number one you need maybe a default,warehouse for consigned two you may want,multiple warehouses maybe you want to,manage,a warehouse per consignment vendor if,you have multiple vendors you're doing,that consignment process with and that,way you can actually link the vendor,account code directly to the warehouse,that might be too much to manage so you,could just have one warehouse and maybe,multiple locations,as well for diff to represent different,vendors that you're doing the,consignment process with so right now,we're going to work with one consigned,warehou

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Vendor Consignment Process in SAP MM

welcome all to my second video for,consignment process in this process okay,first we will see what is a vendor,consignment process so in this process,we undertake with own material into our,premises,the nurses like it can be a plant or,warehouse ownership of the said material,remains in the vendor books under the,inter concerning patience is treated as,a special procurement in SP then company,requires certain kind of product with a,specific quantity consignment purchase,order has been raised and the withdraw,of material from vendor consignment,stock for the use light production or,sales or any internal consumption in,entering this transferred in the books,of company that is purchaser after,resuming it after removing it from,consignment stock afterwards the healthy,set of liability for the said the drug,material by a production called Mr ko we,can set the following features of,vendors of consignment versus inventory,or consignment stock it's only valuated,after it is consumed or withdrawn price,is maintained in the purchase info,record with info category as consignment,consignment metal and under stick to,stock metal numbers are same this,receipt is always non valuated although,their candidate with different scenarios,in consignment process first after goods,receipt that that is after gr in those,days it note we can do store transfer,from plant to store consumption stock,and cancel it directly second we can do,transfer hosting to our own stock so,what it appears as unrestricted stock in,our books and later we can sell it this,is a process actually first of all in,our system we have to create a,concerning info record if not ticket we,have to slip in fifth category as a,consonant in equal NP 11 now after that,create Co create purchase order in,production for a be 21 and then goes,through sit then transfer question and,liability settlement a marquee o is,something different that like,transaction code 0 mi ro but in this,case we have to use transaction code m r,KO for when the consignment okay fine,they like this non tutorial if you have,any suggestions or questions we would,love to hear from you,it will be a gear great health a big,help for us to improve our free SME mm,tutorial please like share and subscribe,the video and I am very much thankful to,you bye bye

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Consignment Inventory Pros and Cons

hi guys ian johnson from drive success,calm today we're going to talk about,running a consignment inventory,agreement and we're going to do this,from the mindset of your company being,the vendor in these types of agreements,we're going to basically explain how the,agreement works it's very simple and,straightforward and then we're going to,basically summarize the pros and cons of,the agreement as a vendor and we're,gonna help you sell this type of,agreement to your customer okay now,before we get started I just wanted to,explain why companies look at,consolidated inventory as a good tool,okay and in order to do that you have to,ask yourself you know what a company has,to cover in terms of its inventory costs,when it comes to purchasing raw,materials finished goods what-have-you,any company regardless of the industry,of the market that it operates in any,company has to cover a cost of freight,on incoming parts oome raw materials and,finished goods it doesn't matter you,know if the vendor has told the company,you know don't worry about I'll include,delivery all the way to your door it,doesn't matter at the end of the day the,company is covering a cost of freight to,get those parts into their warehouse,okay so you know either either it's,provided as a service and it's hidden,inside the vendors price or it's a,separate line item that you have to,cover on your own regardless of either,one of those things the company has to,cover Freight to get products into the,warehouse and that is a huge cost of,inventory so that's one of the main,benefits of vendor consignment okay is,that the the entire agreement is,structured around reducing your,customers per unit freight cost but also,reducing your own per unit freight cost,if you're providing it as a service to,your customer you're going to lower your,freight costs but you're going to lower,your customers as well and the second,benefit is pricing higher volume lower,pricing so we're going to go through how,the agreement works it's very,straightforward,we're going to basically go over this,example of an agreement over six months,I've written consignment usage and,vendor and in consignment what happens,is you ship a large volume of product to,your customers location but your,customer doesn't own that volume okay,your customer only pays for what they,use in a given week a month or a quarter,okay and you'll have to determine you,know when you invoice your customer and,how you reconcile inventory so in this,case in the first month you ship a,thousand units your customer doesn't use,any of a thousand units that means you,still own them and this is an important,point here the items that are on,consignment are essentially that remain,on consignment are essentially all,invite you as the vendor okay so in the,first month your customer didn't use any,that means you still own the total,amount of inventory the thousand units,in the second month they used 100 so,there's 900 left on consignment and,there's 900 left in terms

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SAP MM Training - Vendor Consignment (Video 31) | SAP MM Material Management

today we are going to start our next,topic vendor consignment so the topics,that we're going to cover their,procurement process with consignment,master data and settings required for,vendor consignment post goods movement,for consignment stock setter consignment,will draw and display no assignment,stock so first of all we would start,with the business example now in brief,if I need to explain you what is,consignment stock if you don't know then,consignment stock is a stock when our,vendor will put their stock on my,company's premises but they are still,the owner not us and we will consume the,stock of whenever we need and when we,consume their stock which is on our,premises in that case whatever is,consumed for those consumption will pay,to the vendor so this is the consignment,so let's see in more detail using this,example your company has arranged with a,vendor to supply a particular quantity,of consignment material pure company the,consignment material is still owned by,the vendor until you will draw it from,the consignment store or post it to your,own stock you take ownership of the,material when you transfer it to your,own stock later you settle the,consignment liabilities with the vendor,monthly so let's see here with the,vendor consignment overview so let's see,what happens here so you can see here,this is our own company and here is a,vendor or the consignment vendor so from,purchasing point of view what will,happen is,will create a consignment purchase order,and then the vendor will send the goods,on our company premises so we'll receive,the goods on our company premises but,still they are donor not us but we have,that in our record that we have some,consignment stock from inventory,management point of view what will,happen is we'll deliver the material and,we have received that goods here in my,company and then at my company,whenever I whenever we withdraw the,material from those consignment stock in,that case we are only liable to pay for,that particular withdrawal so in that,case we'll be paying them for the,liabilities and from the invoicing,verification for point of view what,we'll do we'll do the settlement for,whatever withdrawal we have done and we,pay the vendor so the same thing we're,going to see on practically on the,server today so first of all we'll start,with master data required for vendor,consignment so what are the master data,basically we need just to to start the,consignment purchase order so obviously,a material will require an vendor and,the other important thing is PR record,will require with the consignment info,category so when it could be a record,using M 11 you need to select the,consignment type so let's do this,exercise first we'll create a master,data first so what I will do I will be,using existing vendor so let us say the,vendor will use 105 0 1 which is the or,vendor material I will be creating a new,one so I'll create a new material say I,will call it consignment 1 and I can,copy it from say other materi

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