Procurement
Procurement in SAP MM is the end-to-end process of acquiring goods and services, from identifying a need to paying the vendor, the procure-to-pay cycle. It is the backbone of the MM module.
Procurement integrates with inventory (stock updates), FI (liabilities and inventory value), and CO (consumables to cost objects).
- Procurement covers stock materials (into inventory), consumables (directly to a cost center/order), services, and…
- Purchase Requisition: an internal request to buy.
- Purchase Order: the formal order to a vendor.
- Watch out: Skipping the three-way match control.
The procure-to-pay cycle
- Purchase Requisition: an internal request to buy.
- Purchase Order: the formal order to a vendor.
- Goods Receipt: receiving the goods (updates stock and GR/IR).
- Invoice Verification: matching the invoice to PO and receipt.
- Payment: paying the vendor (FI-AP).
Types of procurement
Procurement covers stock materials (into inventory), consumables (directly to a cost center/order), services, and subcontracting/special procurement. The process and account determination differ by type, so understanding which applies is important.
Integration and control
Procurement integrates with inventory (stock updates), FI (liabilities and inventory value), and CO (consumables to cost objects). Controls like release strategies (approval workflows) and the three-way match (PO, receipt, invoice) ensure spend is authorised and correct.
Common pitfalls
- Skipping the three-way match control.
- Wrong procurement type, incorrect postings.
- No release strategy on high-value POs.