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ECR Compliant Procurement Processes SAP Best Practices for Retail (US)

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Presentation on theme: "ECR Compliant Procurement Processes SAP Best Practices for Retail (US)"— Presentation transcript:

1 ECR Compliant Procurement Processes SAP Best Practices for Retail (US)

2 Scenario Overview - 1 Purpose and Benefits: Purpose Benefits
Version 1 - Buyer-Managed Inventory Purpose and Benefits: Purpose The scenarios presented in SAP Best Practices for Retail deal with the retailer`s procurement processes, which include buyer-managed inventory and vendor-managed inventory. Benefits efficient merchandise control which fulfills the requirements of ECR-compliant procurement processes more efficient communication between retailer and manufacturer/vendor Key process flows covered Process purchase order in the retailer system Process sales order in the vendor system Check purchase order confirmation in the retailer system Process delivery in the vendor system Perform goods receipt with reference to shipping notice in the retailer system Create billing document in the vendor system Carry out invoice verification in the retailer system

3 Scenario Overview - 2 Purpose and Benefits: Purpose Benefits
Version 2 - Vendor-Managed Inventory Purpose and Benefits: Purpose The scenarios presented in SAP Best Practices for Retail deal with the retailer`s procurement processes, which include buyer-managed inventory and vendor-managed inventory. Benefits efficient merchandise control which fulfills the requirements of ECR-compliant procurement processes more efficient communication between retailer and manufacturer/vendor Key process flows covered Transfer the stock data of the retailer to the manufacturer Carry out replenishment planning with resulting sales order in the manufacturer system Generate the purchase order automatically in the retailer system with a report to the manufacturer

4 Scenario Overview - 2 SAP Applications Required: Required
Version 1 and Version 2 SAP Applications Required: Required SAP EHP3 for SAP ERP 6.0 Company roles involved in process flows Retail Purchaser Manufacturer

5 Process Flow Diagram Version 1 - Buyer-Managed Inventory
Retail Purchaser Create Purchase Order Generation of Purchase Perform Goods Receipt with Reference of Shipping Notice Display Billing Document DESADV IDoc ORDERS Manufacturer IDoc ORDERSP INVOIC Create Sales Order Create Delivery Picking and Posting of the Goods Issue Create Invoice

6 Process Flow Diagram Version 2 - Vendor-Managed Inventory
Retail Purchaser Display IDoc ORDCHG Display Sales Order Transfer the stock data of the Retailer to the manufacturer Manufacturer Display IDoc PROACT Display received stock Execute Replenishment Display IDoc ORDSP

7 ECR Compliant Procurement Processes Introduction
Between Retailers and Manufacturer of the German textile and apparel industry, cooperatively concepts within the framework of procurement, marketing and using of information and communication technology are developed. Collaboration concepts, like Efficient Consumer Response (ECR), earn on importance. The new technologies open small and middle comanies the possibility to accomplish the structure change and also to reinforce  their competitive strength. SAP offers a software solution within the framework of the SAP Best Practices Version, which reflects the new requirements of ECR conformable procurement processes.

8 ECR Compliant Procurement Processes Introduction
With SAP software you have the possibility to build up the manufacturer and also the retailer side. We will show you here the procurement processes on the retailer side. The ECR conformable procurement processes embrace the price catalog, the buyer managed inventory and also the vendor managed inventory.

9 Price catalog: PRICAT PRICAT Is an EANCOM standard message type
Area of master data Enables pricing and catalog-related data for goods and services to be transferred from a vendor to a buyer Complete listing of all products Notification of changes Information relevant for all customers Customer-specific information Data supplied to a central article database

10 Price catalog: Supply of a data pool
Vendor Retailer Sender Recipient Data Pool f. e. Sinfos Generate of PriceCatalogue Idocs XI XI Inbound processing of PriceCatalogue Idoc Master Data BAPI/ALE

11 Price catalog inbound: process flow
Simulation of IDoc Inbound processing Display Header Data (catalog) List of article Adopt Profile Process Price catalog manual / automatical Process not existing article data in the Customer system (EAN‘s) / Creating article Process available article data in the customer system (EAN‘s) / Update of article

12 Price catalog inbound: catalog creation
The catalog is stored on the database as a separate business object PriceCatalogue EANCOM fields that do not correspond to R/3 fields are transferred to the system It is possible to select articles to be updated Transfer can be controlled at field level If an EAN exists uniquely in the system, article assignment is carried out If errors occur, an application log containing all messages is created (transaction PRICATLOG)

13 Price catalog inbound: preparation
Preparation before catalog transfer Assignment of ILN to SAP vendor, purchasing group Assignment of merchandise categories to SAP merchandise categories (for each ILN) Assignment of SAP merchandise categories to purchasing groups Workflow preparation Assignment of buyers (SAP users) to organizational units, to which the relevant purchasing groups are assigned (transaction PFOM)

14 Price catalog inbound: accessing catalog maintenance
Header data Set catalog status After processing, the catalog status is automatically set to 'processed' Catalog status can be manually set to 'closed' Set test indicator If you want to process the catalog you have to enter always the purchasing group Price catalog could be processed manually or automatically

15 Price catalog inbound: accessing catalog maintenance
List of article In the list of article you will find now the article (items) of the new price catalog Items are distributed among several views according to their status New items have no entra in the field ‚article‘ and you can find this items in tabstrip ‚to be processed‘, ‚to be processed (article can not be assigned)‘ and ‚all entries‘

16 Price catalog inbound: assignment of EAN to an article
The assignment of EAN to an article occurs automatically when a catalog is created (unique EAN) Manually in catalog maintenance Assigned article is stored in price catalog Can be entered at a later date If the EAN is not unique, all possible EANs are displayed For assignment, articles are also displayed with the vendor article number from the catalog New articles need template articles (proposed from the merchandise category)

17 Price catalog inbound: transferring catalog data to article data
Adopt profile The transfer of catalog data to article data could be done with an adopt profile The adopt profile enables the simultaneous display of catalog data and article data (or in the case of new data, the template article) Required data must be explicitly transferred from the catalog to the article side, either manually or by using a transfer profile Adopt profiles could be stored and used again The article fields can be edited

18 Price catalog inbound: assignment of EAN to unit of measure
Automatically By mapping the EANCOM packaging type to alternative unit of measure in the converter During R/3-R/3 data interchange Manually in catalog maintenance Can be changed at a later date New units of measure must be explicitly transferred It is possible to transfer all units of measure from the catalog

19 Price catalog inbound: updating to article
What can be updated: Basic data Texts BOMs (new) What cannot be updated: Characteristics Generic article/prepack BOM changes Conditions Material

20 Buyer managed inventory (BMI)
For the more efficient communication between the retailer and the vendor, documents like purchase orders, order confirmations, delivery notifications and invoices are relayed electronically. SAP ERP offers for communication the possibility of the generation of so called IDoc’s. An IDoc is an electronic document in SAP standard format. SAP offers furthermore the possibility, with help of XI (open integration technology of SAP) to process all notification formats (like SEDAS, UN, EDIFACT, XML …).

21 Scenario BMI: process flow

22 Scenario BMI: process flow

23 BMI: process flow Retailer Manufacturer Lieferant 1. Purchase order
Filiale Verteilzentrum 2. PO confirmation 3. Shipping notif. 4. Invoice Store DC

24 BMI: purchase order handling
Retailer Manufacturer Generation of IDoc Create Purchase Order Create Sales Order ORDERS Check PO confirmation Generate PO confirmation ORDRSP

25 BMI: goods processing Retailer Manufacturer EDI-Interface DESADV
Shipping notification Create Deliveries DESADV Post goods receipt Articles to Retailer

26 BMI: payment transactions
Retailer Manufacturer Generation of IDoc Verify and post invoice Invoicing INVOIC

27 BMI: conclusion

28 Vendor managed inventory (VMI)
Vendor managed inventory means, that the manufacturer will make the disposition of his products (as a service for the retailer), which are represented in the stores of the retailer This requires, that the manufacturer knows the actual stock and sales data of his products in the retailer stores. The manufacturer could then make a prognosis of the sales data of his products and also an effectives replenishment would be possible.

29 VMI: process flow

30 VMI: transfer of stock data
Manufacturer Maintains stock data of his products at the retailer site Tracks sales history Retailer Sends stock and sales data at a regular basis to the manufacturer

31 VMI: transfer of stock and sales data
Retailer Manufacturer Generation of IDoc Actual Sales data will be updated in the information structure S130 Sending of stock and sales data PROACT Stock data will be written in the table WRPT

32 VMI: sending stock and sales data to the manufacturer
Done by report for selected supplier and stores interactiv or in batch processing Generation of IDoc PROACT Article and data selection is controlled by profiles in the vendor master stock and on-order quantity sales history

33 VMI: planning of replenishement
Order Response Manufacturer calculates replenishment requirements generates sales order

34 VMI: planning of replenishment
Retailer Manufacturer Generation of IDoc Via replenishmentPlanning a customer order will be created Purchase order will be created ORDRSP

35 VMI: Planning of replenishment
Order changes Manufacturer updates sales order with PO number from retailer system

36 VMI: planning of replenishment
Retailer Manufacturer Generation of IDoc Purchase order number from the retailer will be insert into the customer order Purchase order change notice will be created ORDCHG

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