SAP MM Procurement Lifecycle: From Purchase Requisition to Invoice Verification

SAP MM Procurement Lifecycle: From Purchase Requisition to Invoice Verification – In this SAP MM Procurement Lifecycle: From Purchase Requisition to Invoice Verification blog, you will find many elements of the SAP MM Module, like its functionalities and operations, as well as several elements and subcomponents including purchasing, billing, human resource management, master data, and inventory management. We will start this SAP MM blog by understanding the SAP MM Module. SAP MM Module is a basic part of the SAP ERP Software. Various companies use SAP Material Management to manage their purchasing and transactional data as it is affordable and time-efficient.

SAP Material Management belongs to the logistic function which aids the sector from procurement to delivery of products. SAP MM Module is made up of different units to manage material procurement and vendors, examine the material condition and quality, as well as pay the vendors. SAP Business Process is an important part of the SAP MM Module. It manages the Manufacturing, Distribution, sales, Unit Maintenance, Planning, and Warehouse Management of an organization. It aids in handling the Inventory and Human Resources of the organization.

What Is SAP Material Management (MM)?

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SAP MM (Material Management) is a module that aids businesses with inventory management, production schedules, supply chain management, procurement processing, and customer material management for production. To guarantee that suitable materials are available when required, it speeds up the procurement process and covers everything from inventory to last invoice receipt and verification. SAP MM plays the main role in handling inventory, including operations such as –

Ensuring materials are accessible in the perfect quantities at the right time and place.
Managing high inventory levels by reducing variation between planned and genuine product amounts and results.
Handling materials and total supply chain successfully and cost-effectively
Observing warehouse management, material storage, material management, and consumption-based planning processes
Use complete applications to handle service management, physical inventory, material valuation, and invoice verification.

Features and Advantages of SAP MM Module

Some of the main features and advantages of the SAP MM Module are as follows:

It works with Inventory Management and Material Management.
It is a method that keeps in check the lack or violation in the Supply Chain of an organization.
It handles Procurement activities.
To quicken productivity and cut expenses, it handles the Material (products or services) and resources of the organization.
It manages Master Data, Valuation of Material, Material requirements, Invoice Verification, and much more.
It reduces the expenses of operations.
It minimizes inventory losses by eliminating unimportant or obsolete material.
Automatic Material Management and procurement activities lead to a seamless well effective process.

SAP MM Move in SAP using Procurement Cycle

Every business company needs materials or services to satisfy its business necessities. The process of getting materials and amenities is called Procurement. Many steps are used to get materials as well as facilities that form an MM Circulation in the sap procurement cycle. The stages of MM circulation in SAP are here. Let us look at every step of the procurement lifecycle in detail –

Deciding the requirement

It is the main step in the Procurement Lifecycle. An organization recognizes the number of materials or amenities required. After deciding on the requirement, a list of products is made that is taken by the senior power to procure.

Purchase Requisition

A company gathers all its needs, and after that, a list of necessities is created that is offered to the purchasing company to get the products listed in the list.

Making the purchase order

After the approval, a purchase order is made which is sent to the seller to get the required material. A purchase order holds information related to the vendor’s name, address, and date of delivery.

Making goods receipt

When the vendor processes the purchase order and provides it to the involved party, the method is called a goods receipt. Then, the authority confirms the quality and condition of the delivered products. After authentication of the material, the receipt of the products is posted.

Making the invoice

The invoice is sent by the vendor to the organization. After getting the invoice, it is confirmed by the company. Now, to make payment to the vendors an account determination in SAP MM is confirmation that makes the system automatically create the G/L Account of the vendor that needs to be paid.

Conclusion

In this technology-based world, the SAP MM module remains in notable demand as all businesses need the SAP MM module to manage their material in a good and trusted manner. SAP MM module aids companies in staying updated and running successfully.

FAQs

What is SAP MM’s main procurement procedure?

Making a Purchase Requisition (PR), issuing a Purchase Order (PO) based on the PR, getting products from the vendor, and then verifying and paying the vendor invoice included in SAP MM’s basic procurement process.

Which are the main procurement-related elements of the SAP MM module?

The main elements are made up of –

Material Master – Holds all of a material’s related data.
Vendor Master – Offers supplier information.
Purchasing (MM-PUR) – Supervise purchase order preparation and processing.
Inventory management (MM-IM) – Observes stock levels and the receipt of goods.
Invoice verification – The procedure of seeing and approving vendor bills is called invoice verification, or MIRO.

What details are mainly included in a purchase request?

The material required, plant, amount, storage location, account assignment, date of delivery, and vendor is mainly included in a purchase request.