C U S T O M E R O R D E R M A N A G E M E N T
8
Chapter
Consignment Orders 8-1
C U S T O M E R O R D E R M A N A G E M E N T
Consignment Orders
Module Objectives
At the completion of this module, you will be able to:
Understand the Consignment Stock process.
Create Consignment related sales documents.
Maintain Consignment Inventory Checklist data.
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Consignment Orders 8-2
Terms and Concepts
Consignment orders
Consignment orders are used when PFC enters into an agreement with a client
(typically a Distributor) where PFC will send them materials and not issue an
invoice immediately. That client will only receive invoices for materials they sold
on a monthly basis.
Consignment Orders Document Flow
Consignment Delivery
Fill-up (KB) note
Debit Memo for
Create with Freight Charges
Create with reference
reference
Create with
Consignment reference
Pick-up (KA)
Consignment Delivery
Invoice
Issue (KE) note
Returns
Delivery note Create with
reference
Consignment Returns
Credit Memo
Returns (KR) Delivery note
ProMinent Fluid Controls, Inc Customer Order Management
The four types of Consignment orders are:
Consignment Fill-up (KB) order
This order type is used to fulfill the Consignment agreement. As PFC
still owns the materials, there is no pricing or costs involved in this
order. Dynamic credit check is carried out automatically during order
entry. Freight charges can only be added by creating a Debit memo with
reference to the Consignment Fill-up order. Materials are allocated in
“Consignment stock.”
Terms and Concepts - continued
Consignment Issue (KE) order
A Consignment Issue (KE) order is used to record the materials the
Consignment Distributor sold. Create this order type with reference
to a Consignment Fill-up (KB) order. Pricing information is
included in this order type. The materials sold information is
derived from the Consignment Inventory Checklist, which is sent to
Consignment Distributors on the 15th of each month. The materials
are deducted from “Consignment stock” and are now considered
“goods sold.”
Consignment Returns (KR) order
The Consignment Returns (KR) order is used when the
Consignment Distributor accepts a returned material from their End
User, and wants to re-sell the returned material. Create a
Consignment Returns (KR) order with reference to a Consignment
Issue (KE) order. This order type will add the material back into
“Consignment stock” and generate a Credit Memo to adjust the
Distributor’s account.
Consignment Pick-up (KA) order
Use this order type only when the Consignment Distributor wants to
return un-sold materials to PFC. Create a Consignment Pick-up
(KA) order with reference to a Consignment Fill-up (KB) order.
Execute post goods receipt to move materials from “Consignment”
to “Regular” stock. There is no pricing or costs involved in this
order as PFC owns the materials.
Consignment Inventory Checklist
A SAP generated list of all consignment materials at a Distributor’s site. This list is
sent to the Distributor on the 15th of each month until the consignment agreement
becomes invalid. The Distributor verifies the type and number of PFC goods they
have on hand against the checklist. The list is sent back to PFC and the CSR will
adjust the Distributor’s accounts accordingly using the four consignment order
types.
Process Overview
Consignment Stock Order OverviewNOTE:
Consignment order types
CSR Creates do not allow materials to
a Quote be configured during
Receive PO
from order entry. Only
Send Invoice Distributor
to Distributor numbered materials
(with or without bills-of-
CSR Enters a
Consign. Fill-up materials) can be used.
(KB) order
SAP Creates
an Invoice
Accounting Dept SAP Creates
creates a Debit a Delivery
Memo for Freight Note
SAP Creates Execute Post
Charges
a Delivery Goods Issue
Note
Consignment
Order Shipped
CSR Enters a to Distributor Materials are in
Consign. Issue Distributor “Consignment
Stock.”
Materials (KE) order counts
are deducted from Inventory at
“Consign. Stock.” their site
ProMinent Fluid Controls, Inc Customer Order Management
1. Customer Support Representative (CSR) Creates a Quote – Create a quote
if the Distributor requests one before issuing a purchase order (PO). Please refer
to Chapter 2: Queries and Quotations, for step-by-step guide on how to enter a
quote.
2. Receive PO from Distributor – Distributor issues a PO to initiate the terms
and conditions of a Consignment stock order.
3. CSR Enters a Consignment Fill-up (KB) order – The CSR creates a
Consignment Fill-up order to record this agreement. No pricing and costs are
involved in this order type as PFC owns the materials. Credit limit check is
automatically executed in the background by the system. Only numbered
materials (with or without a bill-of-material) can be entered.
**CSR maintains the Consignment Checklist data and email tables. These two
tables ensure the monthly “Consignment Inventory Checklist” report is
generated accurately.
4. SAP Creates a Delivery Note – SAP creates a delivery note(s) so materials can
be retrieved from the Warehouse and Production can fulfill the order.
Process Overview – continued
5. Consignment Order Shipped to Distributor – The consignment order is
shipped to the Distributor. Post goods issue is executed for the delivery note.
The materials are now in “Consignment stock.” No invoice is generated as the
goods still belong to PFC.
6. Distributor counts Inventory at their site – Distributor is requested to count
their consignment inventory on a monthly basis. PFC will send them a
“Consignment Inventory Checklist” where they can record the details of their
consignment stock level against PFC’s count. The checklist is returned to PFC
for invoicing.
7. CSR Enters a Consignment Issue (KE) order – The CSR receives the
Consignment Inventory Checklist from the Distributor. The CSR then creates a
Consignment Issue order, with reference to the Consignment Fill-up (KB) order
for materials sold. Material pricing and discount are entered in this order.
8. SAP Creates a Delivery Note – SAP creates a delivery note to allow post
goods issue, which triggers material movement and invoice creation. The
materials are deducted from the “Consignment stock” and are now considered
“goods sold.”
9. SAP Creates an Invoice – SAP creates an invoice during the nightly
background job.
10. Send Invoice to Distributor
SAP R/3 Transaction Procedures
The following pages outline the transaction procedures for the following SAP R/3
tasks:
Create a Consignment Fill-up (KB) order
o Edit Partner Function – Header level
o Enter Material Information
Create a Consignment Issue (KE) order
Create a Consignment Returns (KR) order
Create a Consignment Pick-up (KA) order
Maintain Consignment Inventory Checklist Data Table
Maintain Internal Recipients of Consignment Inventory Checklist Report
Generate Consignment Inventory Checklist Report
Close Consignment Agreements
Create a Consignment Fill-up order
Use this order type to initiate the Consignment agreement with a Distributor.
Logistics Sales and Distribution Sales
Order Create
VA01
TIP:
Create Sales Order: Initial Screen
US
To create a consignment order, complete the following fields:
Sales organization = 0300 Order Type Enter “KB” for Consignment Fill-up Order.
Distribution channel = 30
Division = 30 Sales organization (User default)
Canada Distribution channel (User default)
Sales organization = 0400
Distribution channel = 40 Division (User default)
Division = 40
Create Consignment Fill-up: Overview
1. Complete the following fields:
Sold-to party Enter the number representing the customer.
If the customer’s number is not known, click
to search for the correct Sold-to party.
If the Sold-to party has multiple ship-to partners, a pop-up window will appear. Select
the appropriate ship-to party by clicking on the partner data.
Ship-to party Enter the number representing the customer.
Purch. order no. Enter customer’s purchase order number.
PO date Enter the purchase order date.
2. Click on the Sales tab to continue entering data in this order.
Create Consignment Fill-up: Overview
The Req.deliv.date defaults to 5 work days into the future.
Verify the customer’s delivery date. Edit the date as necessary.
Create a Consignment Fill-up order: Edit Partner Information
The following is a continuation of the “Create a Consignment Fill-up Order” transaction. Use the
following to make changes to Partner information.
Header Level
Header level Partner information is valid for the entire document. Changes made in the
header level are applied to the whole document.
Create Consignment Fill-up: Overview
To edit Partner information in the Header level, follow the menu path Goto Header
Partner OR click and then the Partners tab.
Create Consignment Fill-up: Header Data
Changes can only be made to open fields.
To edit Partner information, double click on the appropriate Partner function. In this
example, the Ship-to party is selected.
Address from mast. Data f. the Ship-to party
(Document header)
The system displays details about the Ship-to party.
Make the appropriate changes to the Ship-to party information.
Create Consignment Fill-up: Header Data
The system returns to this screen.
To return to the Sales tab, follow the menu path Goto Overview OR click .
Create a Consignment Fill-up order: Enter Material Information
The following is a continuation of the “Create a Consignment Fill-up Order” transaction. Use the
following to enter material requested by the customer.
Make-to-order materials such as Gala and D1Ca cannot be entered as you
normally would for a Standard or Rush order. Only numbered materials (with or
without bills-of-materials) can be used for Consignment related materials.
NOTE: Create Consignment Fill-up: Overview
If a material number was
entered in error, the line 1. In the Sales tab, complete the following fields:
item must be rejected.
Click the Reason for Material Enter the product number.
rejection tab, select the Order quantity Enter the requested quantity.
appropriate reason for
rejection for the line item
to be rejected. 2. Click and the system will populate the remaining fields for that material.
If there is a shortage of the item for the delivery date, a check mark will appear in the
Schedule line checkbox.
In this order type, by default, no pricing is populated for the materials.
Create a Consignment Fill-up order – continued
Create Consignment Fill-up: Overview
When all the necessary information is entered, click to save the Consignment Fill-up
order.
Consignment Fill-up 40000XXX has been saved
Create a Consignment Issue order
Use the following to record the materials the Consignment Distributor sold.
Logistics Sales and Distribution Sales
Order Create
VA01
Create Sales Order: Initial Screen
1. Complete the following fields:
TIP:
Order Type Enter “KE” for Consignment Issue order.
US Sales Organization (User Default)
Sales organization = 0300
Distribution channel = 30 Distribution Channel (User Default)
Division = 30
Division (User Default)
Canada
Sales organization = 0400 2. Click to reference this issue order to the Consignment Fill-
Distribution channel = 40
Division = 40 up order.
Create with Reference
1. Click on the Order tab.
2. In the Order field, enter the preceding Consignment Fill-up (KB) order
number.
3. To edit the list of materials to be copied, click .
Create a Consignment Issue order – continued
Consignment Fill-up XXXXXXXX: Selection List for Reference
Document
1. Uncheck the items you do not want copied over to the Sales Order.
2. In the Open Quantity field, enter the quantity of material being returned.
3. Click to copy the information to a new sales order.
Several warnings may appear after clicking the “Copy” icon. Press “Enter” to
continue through these messages.
Create Consignment Issue: Overview
1. Complete the following fields:
Purch. order no. Enter the Purchase Order number.
PO date Enter the Purchase Order date.
Req. deliv. date Change to today’s date.
2. Edit the rest of the sales order as appropriate.
Verify pricing is correct.
Create a Consignment Issue order – continued
Create Consignment Issue: Header Data
1. Use Shipping text to avoid repeat shipment, follow the menu path Goto
Header Texts OR click and then the Texts tab.
2. Double-click on the Shipping instructions in the Txt. Ty field.
3. In the large textbox, enter the following text:
Consignment Order – Do not ship
Give Delivery note to Shipping for posting.
4. When all the necessary information is entered, click to save the sales order.
Create Consignment Issue: Overview
Consignment Issue 40000XXX has been saved
Process Overview
Consignment Stock – Returns
(Invoiced Material)
End User
Returns Materials
to Distributor
Distributor
is able to re-sell
the material.
Credit is CSR Enters a
Applied to Create with
Consign. Returns
Distributor’s Reference to the
Account Consign. Issue (KE) (KR) order
order
Materials
Accounting are returned to SAP Creates Execute Post
Dept Issues a “Consignment a Returns Goods Receipt
Credit Memo Stock.”
Delivery Note
ProMinent Fluid Controls, Inc Customer Order Management
1. End User Returns Material to Distributor – An End User returns material to
the Distributor. The Distributor determines that the material can be re-sold
and wants to keep the material at their site.
**If the Distributor wants to permanently return a previously sold material to
PFC, please refer to guidelines in the following page on how to manage this
process.
2. Customer Support Representative (CSR) Enters a Consignment Returns
(KR) order – The CSR creates a Consignment Returns order with reference to
the corresponding Consignment Issue (KE) order to record this transaction.
Material pricing and discount are copied from the Consignment Issue order to
the Consignment Returns order. A Contaminant-Free Certification is also
printed with the order confirmation.
3. SAP Creates a Returns Delivery Note – SAP creates a Returns Delivery note.
Execute post goods receipt to “move” the material back into Consignment
stock. PFC again owns the material.
Process Overview - continued
4. Accounting Department Issues a Credit Memo – The CSR informs the
Accounting department of the Consignment Returns order. The Accounting
department releases and issues a Credit memo.
5. Credit is Applied to Distributor’s Account – Credit is applied to the
Distributor’s account as the Distributor had previously paid for the material
when it was initially sold to the End User.
**If the Distributor wants to permanently return a previously sold material to
PFC, use the following guidelines:
Enter a Consignment Returns (KR) order and use the order
confirmation number as the Return Material Authorization (RMA) number.
Notify the Distributor to use this number and the Contaminant-Free
Certification as part of the standard PFC Return procedure.
Follow steps 3, 4 and 5 of the Consignment Stock – Returns process for
Invoice Material.
Follow all steps of the Consignment Stock – Returns process for Un-
sold Material.
Create a Consignment Returns Order
Use the following to record invoiced materials returned to the Distributor. This process “moves”
stock back into PFC’s possession and allows for credit adjustment to the Distributor’s account.
Logistics Sales and Distribution Sales
Order Create
VA01
Create Sales Order: Initial Screen
1. Complete the following fields: TIP:
Order Type Enter “KR” for Consignment Returns Order
US
Sales Organization (User Default) Sales organization = 0300
Distribution channel = 30
Distribution Channel (User Default) Division = 30
Division (User Default) Canada
Sales organization = 0400
2. Click Distribution
to reference this issue order to the Consignment Issuechannel = 40
Division = 40
order.
Create with Reference
1. Click on the Order tab.
2. In the Order field, enter the preceding Consignment Issue (KE) order
number.
3. To edit the list of materials to be copied, click .
Create a Consignment Returns Order – continued
Consignment Issue XXXXXXXX: Selection List for Reference
Document
1. Uncheck the items you do not want copied over to the Sales Order.
2. In the Open Quantity field, enter the quantity of material being returned.
3. Click to copy the information to a new sales order.
Several warnings may appear after clicking the “Copy” icon. Press “Enter” to
continue through these messages.
Create Consignment Returns: Overview
1. Complete the following fields:
Purch. order no. Enter the Purchase Order number.
PO date Enter the Purchase Order date.
Order reason Select the appropriate reason for the return.
2. Edit the rest of the sales order as appropriate.
Verify pricing is correct.
Create a Consignment Returns Order – continued
Create Consignment Returns: Overview
1. Use Shipping text to avoid paperwork uncertainty, follow the menu path Goto
Header Texts OR click and then the Texts tab.
2. In the Txt. Ty column, double click on the Shipping instructions.
NOTE:
3. In the large textbox, enter the following text:
Consignment Returns To ensure the customer
Give paperwork to (Your Name). receives the appropriate
credit, please inform the
Accounting Supervisor of
this Consignment Returns.
4. When all the necessary information is entered, click to save the sales order.
Create Consignment Returns: Overview
Consignment Returns 200X4XXXXX has been saved
Process Overview
Consignment Stock – Returns
(Un-Sold Material)
Distributor
Returns Material
to PFC
CSR Enters a
Consign. Pick-Up
(KA) order
Execute Post
Goods Receipt
SAP Creates
Materials a Returns
are returned to Delivery Note
“Regular Stock.”
ProMinent Fluid Controls, Inc Customer Order Management
1. Distributor Returns Material to PFC – The Distributor returns unsold
material to PFC.
2. Customer Support Representative (CSR) Enters a Consignment Pick-up
(KA) order – The CSR creates a Consignment Pick-up order with reference to
the corresponding Consignment Fill-up (KB) order. There is no material pricing
and discount for this order. Consider the order confirmation number as a Return
Material Authorization (RMA) number and notify the Distributor to use this
number as part of the Return procedure.
3. SAP Creates a Returns Delivery Note – SAP creates a Returns Delivery note.
Execute post goods receipt to “move” the material back into regular stock. No
invoice will generate as materials are owned by PFC.
Create a Consignment Pick-up Order
Use the following to record the un-sold materials returned to PFC from a Consignment Distributor.
Logistics Sales and Distribution Sales
Order Create
VA01
Create Sales Order: Initial Screen
1. Complete the following fields: TIP:
Order Type Enter “KA” for Consignment Pick-up Order
US
Sales Organization (User Default) Sales organization = 0300
Distribution channel = 30
Distribution Channel (User Default) Division = 30
Division (User Default) Canada
Sales organization = 0400
2. Click Distribution
to reference this issue order to the Consignment Fill- channel = 40
Division = 40
up order.
Create with Reference
1. Click on the Order tab.
2. In the Order field, enter the preceding Consignment Fill-up (KB) order
number.
3. To edit the list of materials to be copied, click .
Consignment Fill-up XXXXXXXX: Selection List for Reference
Document
1. Uncheck the items you do not want copied over to the sales order.
2. In the Open Quantity field, enter the quantity of material being returned.
3. Click to copy the information to a new sales order.
Several warnings may appear after clicking the “Copy” icon. Press “Enter” to
continue through these messages.
Create a Consignment Pick-up Order – continued
Create Consignment Pick-up: Overview
1. Complete the following fields:
Purch. order no. Enter the Purchase Order number.
PO date Enter the Purchase Order date.
Order reason Select the appropriate reason for the return.
2. Edit the rest of the sales order as appropriate.
3. When all the necessary information is entered, click to save the sales order.
Create Consignment Pick-up: Overview
Consignment Pick-up 200X4XXXXX has been saved
Maintain Consignment Inventory Checklist Data Table
This table maintains the accuracy of the Consignment Checklist report that is sent to Distributors
on a monthly basis.
SM30
Change View “Customer Consignment orders”: Overview
In the Table/View field, enter “ZSDCONSIG_ORDERS.”
Change View “Customer consignment orders”: Overview
To record the new Consignment Fill-up (KB) order, click .
New Entries: Overview of Added Entries
Complete the following fields:
SD document Enter the Consignment Fill-up (KB)
TIP:order
number.
US
SOrg. (User Default) Sales organization = 0300
DChl (User Default) Distribution channel = 30
Division = 30
Division (User Default)
Canada
Sales document type = “KB” for Consignment Fill-up order.
Sales organization = 0400
Distribution channel = 40
Customer Enter the Distributor’s Sold-to number.
Division = 40
Maintain Internal Recipients of Consignment Inventory Checklist
Report
This table maintains who receives the monthly Consignment Checklist report.
SM30
Change View “Customer Consignment orders”: Overview
In the Table/View field, enter “ZSDCONSIG_EMAIL.”
Change View “Customer consignment orders”: Overview
To enter the Consignment Checklist report recipient, click .
New Entries: Overview of Added Entries
Complete the following fields:
SOrg. (User Default)
User Enter the recipient’s SAP logon name.
Generate Consignment Inventory Checklist Report
The following details how to manually generate the monthly Consignment Checklist report.
This report is intended to generate on a regular schedule.
ZCONSIGN
Customer consignment
Complete the following fields:
Sales document Enter the Consignment Fill-up (KB)
TIP:order
number.
Sold-to party Enter the Sold-to account number.US
Sales organization = 0300
Sales organization (User Default)
Canada
Print customer count form Check this checkbox if you want Sales
to generate
organization = 0400
the Inventory checklist.
Close Consignment Agreements
Execute this step to “close” the order when a Consignment agreement is complete.
Logistics Sales and Distribution Sales
Order Change
VA02
Change Sales Order: Initial Screen
In the Order field, enter the Consignment Fill-up (KB) order number.
Change Sales Order: Initial Screen
Consider the subsequent documents
NOTE:
Change Consignment Fill-up XXXXXXXX: Overview
Order reasons:
In the Order reason field, select the appropriate consignment reason to “close” this
200 - Consignment Cancelled agreement.
201 - Consignment Completed
Create Consignment Fill-up: Overview
Consignment Fill-up XXXXXXXX has been saved
