Processing Contracts 

Use

As a strategic purchaser, you can create purchase contracts in SAP Enterprise Buyer. Enterprise Buyer, as the central purchasing system, saves the contract data and uses it for local purchase orders, purchase orders of the extended classic scenario, and purchase orders of the direct material scenario. Purchase contracts are used for sourcing and pricing in the Shop and Process Purchase Orders applications. You can use the purchasing contract for:

·         Indirect materials (Consumables (MRO))

·         Direct materials (production related stock materials)

You can distribute direct material items from a contract to a linked SAP-APO system. See Reports

Integration

Sourcing

·        You can use SAP Enterprise Buyer as a Sourcing Hub (for example, within the strategic sourcing scenario) and create contracts locally or in the backend system. See the Prerequisites section

·        With the Business Add-In Find and Check Sources of Supply, you can define your own rules for sourcing. You determine which contract items the system transfers to the sourcing table (BBPD_PD_INDEX). You can use, customer fields (for example, delivery priority) or you can restrict the results of the standard search.

For more information, see the Supplier Relationship Management Implementation Guide (IMG): SRM Server ® Business Add-Ins for Enterprise Buyer (BAdIs) ® Sourcing  ®  Find and Check Sources of Supply

SAP Bidding Engine

·         You can create a contract using the SRM component SAP Bidding Engine (the document attains the status Held) and then complete the contract in Enterprise Buyer using the Process Contracts application.

·         You can createa bid invitation from a contract. Enterprise Buyer transfers the relevant contract data to SAP Bidding Engine. The system transfers the contract vendor to the bidder for the bid invitation and saves the document with the status held. At header level, you have to supplement the submission deadline for the items in the bid invitation. The system also takes changeable documents from the contract to the bid invitation.

Product Category Items

·         You cannot create bid invitations for product category items because SAP Bidding Engine does not yet support this process. If you attempt to convert contracts with product category items into bid invitations, the system does not transfer these items and issues a message to this effect.

For more information, see SAP Bidding Engine.

·         If, following a bid invitation, you create a contract from a bid that contains items with description and product categories, the system transfers these items with the item category Normal. Subsequently, in the contract, you can change the item category to Product category.

Global Outline Agreements

In the SRM System you can create a global outline agreement and distribute it to linked backend systems.

For more information, see Global Outline Agreement Processing.

SAP Business Information Warehouse (SAP BW)

If you are integrating SAP BW, you have numerous evaluations at your disposal for purchase contracts from SAP Enterprise Buyer and SAP R/3. These evaluations enable a search via product/group, purchasing organization, purchasing group, vendor, and date. The system transfers only the responsible purchasing organization to SAP BW, not the release-authorized purchasing organization.

You can use SAP BW alerts for target quantities, target values, or validity period excess for the contract. SAP delivers related exceptions that trigger workflows.

You can integrate your own evaluations.

See the path in the IMG: SRM Server  ® Cross-Application Basic Settings ® Define Logical Systems and Template Names for BW Reports

Pricing

For more information, see Pricing.

Delivery Time

·        If you do not specify a delivery date in the purchase order, the system takes the delivery time from the contract.

·        In the purchase order, the system takes delivery time details at item level with first priority and the delivery time at header level with second priority. The system only uses a header delivery time if the item contains no value for this.

·        If a shopping cart has a preferred delivery date that cannot be met because of the delivery time in the contract, then the system issues a warning message.

Incoterms

In the purchase order the system takes Incoterms at item level with first priority and then, with second priority, the Incoterms from the contract header. The system only uses header Incoterms if the contract item contains no value for these.

For more information, see Incoterms.

Prerequisites

·        If you wish to evaluate alerts with SAP BW, for example, you have a BW System connected.

·        In order to use the contract preview, you must have installed an application on your PC that can display pdf files.

·        If you wish to set a different date for the display currency than the current date, you must have filled your system’s currency table accordingly.

Customizing Settings

Very little Customizing is required for contracts. Partner schema, partner functions, and the transaction type (PCTR) have already been specified. You can create your own transaction types, for example, to distinguish between contract types.

In Customizing you have defined the following:

·        The number ranges for purchase contracts

See the path in the IMG: SRM Server ® Cross-Application Basic Settings ®  Number Ranges  ®  Define Number Ranges for Purchase Contracts

·        The output of contracts

See the path in the IMG: SRM Server ® Cross-Application Basic Settings ® Set Output Actions and Output Format ® Define Actions for Purchase Order Output

You can use the action profile BBP_PD_CTR for the application BBP_PD.

·        Workflows

For more information, see SAP Business Workflow

You can use the following:

¡        Approval workflows

When releasing contracts and changing released contracts.

For more information, see Processing of Change Versions

¡        Contract alarm workflows

To facilitate SAP BW alerts, you make sure that event coupling is activated for the contract alarm workflow (WS10400022) and that the task (characteristics) is defined as General or that individual processors are assigned. For a general task, the entire purchasing group can process workitems. If you only want to authorize certain individual colleagues in a purchasing group as processors, you have set the characteristic General Forwarding Allowed and have specified the processor in task-specific Customizing under EBP-WFL for the relevant task (TS10407926 Check Contract, for example).

See the path in the IMG: SRM Server  ® Cross-Application Basic Settings ® SAP Business Workflow ® Perform Task-Specific Customizing

·        SAP BW evaluations including

¡        Vendor evaluation for contracts

See the path in the SAP IMG under Integration with Other mySAP Components ®  Settings for Application-Specific DataSources (SRM)  ®  Define Events for Vendor Evaluation in SRM

¡        Maverick evaluation

See the path in the Supplier Relationship Management IMG: SRM Server  ® Cross-Application Basic Settings ® Define Logical Systems and Template Names for BW Reports

·        Backend System

This setting is only required if you are using backend contracts, for example, as part of the strategic sourcing scenario. In the standard, Enterprise Buyer creates the contract locally.

If the contract is to be created in the backend system, you control this using a Business Add-In.

See the path in the IMG: SRM Server  ® Business Add-Ins for Enterprise Buyer (BAdIs)  ®  Shopping Carts and Requirement Items  ® Determine Backend System/Company Code

·        Search results list on the initial screen

This setting is only necessary if you wish to restrict the search results display on the initial screen.

See the path in the IMG: SRM Server  ® Business Add-Ins for Enterprise Buyer (BAdIs)  ®    Display Worklists and Search Results Lists

Features

Search, Display

You can use numerous search criteria with the simple search or the extended search, for example, you can search for the contracts you (as the logged on user) are responsible for using My Contracts. The search results are sorted in the standard in descending order of contract number and they also display the document status.

Create, Change, Delete

You can create and change header data and items. You can delete a contract from the change mode as long as no releases exist. In the standard, you create the contracts locally in SAP Enterprise Buyer without reference to contracts in the R/3 backend system. See the Prerequisites section

Copy

You can copy the contract. This way you transfer, for example, the data of an expiring contract into a new contract. When copying, the system automatically assigns a contract number.

Check

You can check newly created and changed contracts. Enterprise Buyer outputs messages on the check results on the lower part of the screen.

Hold

You can hold contracts for processing at a later date.

Release

You can release complete (error-free) contracts. It can then, in turn, be used as a source of supply and in pricing.

Close, Lock

See Status Management in Purchase Contracts

Output Preview, Output Contracts

You can display a preview of the contract output. You can output contracts that have the status Complete. According to the settings made in Customizing, you can do this directly or via a report. Enterprise Buyer uses the output medium in the vendor master. See also:

¡        See the path in the IMG: SRM Server  ® Cross-Application Basic Settings ® Define Actions for Purchase Order Output.

¡        Purchasing Document Output

Download File

You can download contracts in CSV format (comma-separated values) to a local PC. The system transfers all header and item data including conditions, however, no release data and no attachments.

Approval

You can use approval workflows for releasing contracts and changing released contracts. See also Processing of Change Versions

Create Bid Invitations

You can create a bid invitation for an expiring contract in order to determine new vendors and to possibly negotiate improved conditions.

Header Data

·        Basic Data

You can display or process the following Basic data:
Contract type	For example, purchase contract
Status	Shows whether a contract is currently created, held, released, or deleted.
Currency	When a vendor is entered in the partner overview, Enterprise Buyer suggests the currency (order currency of the vendor) that can be changed, and copies it into the item and the associated condition. You can display a contract in a different currency from that with which it was created. The default setting shows the contract currency at the current rate of exchange.
Valid from [...] to	Enterprise Buyer suggests the current date as period start date as well as an end date that can be changed.
Responsible Purchasing Organization, Responsible Purchasing Group	During creation, Enterprise Buyer suggests the data in changeable form (from the user attributes).
Delivery Time	At header and item level, you can enter a delivery time in days. You can use different delivery times, for example, 10 days in the header and 14 days for item X.
Incoterm	At header and item level, you can enter Incoterms (different Incoterms in each case, if necessary). The input help contains the values defined in Customizing. See the path in the IMG: SRM Server  ® Cross-Application Basic Settings ® Create Incoterms
Terms of payment	You can enter terms of payment for each contract. Enterprise Buyer suggests the value from the vendor master, if available. The input help contains the values defined in Customizing. See the path in the IMG: SRM Server  ® Cross-Application Basic Settings ® Create Payment Conditions
Created on	Displays the creation date and who created the contract.
Changed on	This is only available following the status held. Displays the date of the last change and the name of the person who made the change.

·        Change documents

A list shows the data that has been changed in the contract, with the exception of the price.

·        Partner overview

You can display/edit the following business partner data for a contract:
Function	·        Vendor (number) Required entry ·        Employee responsible (number) Required entry; the system suggests the current user. You can change this entry. ·        Release-authorized purchasing organization (number) Enterprise Buyer suggests the responsible purchasing organization of the purchaser. You can specify additional purchasing organizations to have release authorization for each contract. For the contract to be available as source of supply for a shopping cart item, the purchasing group that is responsible for the item must be assigned to a purchasing organization with contract release order authorization. See also Maintaining User Attributes If you do not specify a particular purchasing organization as having authorization, the contract is available for all purchasing organizations.
Number	You can enter the business partner number or select it via input help.
Name	The name of the business partner

·        Documents

At header level, you can enter a vendor text and an internal note, and also append multiple attachments. If a contract has been created in SAP Bidding Engine, the system displays any documents relating to it in a Collaboration.

·        Conditions

At header level, you can enter discounts or surcharges. At item level, you can choose from further conditions.

For more information, see Conditions in the Purchase Contract.

·        Output Logs

You can check if and when a contract was output and with which medium.

·        Status

For more information, see Status Management in the Purchase Contract.

·        Approval Preview

Displays the name of the approver

·        Analyses

You can use the following evaluations:

¡        Vendor evaluation in SRM

¡        Maverick evaluation

For more information, see Strategic Reports.

·        Versions

You can display and compare document versions. For more information, see Versions of Purchasing Documents

Item Data

·        Add Catalog Items

You can transfer items from a catalog and also use an integrated catalog.

·        Item Overview

Using the following checkboxes, you can extend or restrict the display with the following fields; as default these fields are not displayed:

¡        Display Release Quantity and Release Value

Controls the display of quantities and values that have been ordered with reference to the contract.

¡        Display Documents

Controls the display of whether documents exist for the item (internal notes, vendor texts, or attachments).

¡        Display Status for Sourcing

Controls the display of the Status. Depending on whether the item is available for sourcing or not, the field contains the value activeor inactive.

In the standard all items are active. In the item details you can set an item as inactive for sourcing. This status is not displayed on the header tab Status.

The following functions and fields are available:
Find Item	You can use criteria to search for items. The system goes through the list of available items until it comes to the item that matches the criteria.
Item Category	Possible item categories: ·         Normal A normal item must have a product category and, in addition, it can contain a product ·         Product category A product category item can only contain a product category. For these items, you create a target value (instead of a target quantity). ·        You cannot restrict a product category item to a single catalog. The item always refers to all connected catalogs. ·        With reference to a product category item (for example, for services) you cannot enter a limit in the Shop application.
Product	You can enter products or select them using the search help. If the product is transferred from the search help, the system automatically updates the display with data from the product master. If you enter products manually, you have to Update manually.
Description	You can use a short text to describe items (for example, from a catalog) for which no master data exists
Product category	Required entry
Target Quantity; Target Value	You can enter a target quantity and/or a target value. As soon as a contract release order takes place, Enterprise Buyer updates the contract release order value and the contract release order quantity. ·        The target value and target quantity fields are only available on item level. ·        You can set up a workflow via a BW alert that is triggered as soon as a particular situation is reached regarding the contract release. For example, as soon as 90% of the target value or quantity is reached. See the Prerequisites section
Unit of Measure	During creation of an item, the system proposes the data in changeable form provided that product master data exists. In the case of items with product, you can select an alternative quantity unit in the item details.
Price	You can also specify a price. Enterprise Buyer displays the price in the item overview only when a unique price exists. A unique price can be changed here as well as in the item detail (under Basic data and Conditions). Otherwise you can branch to the conditions using a link.
Price Unit	You can also specify a price unit.
Add New Items	Extends the item overview providing further lines for entry.
Deactivate All Items for Sourcing	All items in the contract are not available for sourcing.
Activate All Items for Sourcing	All items in the contract are available for sourcing (as long as the contract has been released).
(Delete Items)	Under Action you can delete an item as long as it has not been involved in a release order.
(Conditions)	You can branch to conditions processing.
(Details)	In the details data, you can branch to the item either by using a link in the item column or by choosing Action.

Item Details

Here you can find the following tabs and functions:

·        Basic Data

Item	Item number
Status for Sourcing	As standard, all existing items are active for sourcing. By deselecting the indicator Status for Sourcing, you can deactivate the item. Inactive items are no longer available for sourcing.
Item Category	Item category display
Product	Product number
Description	Can only be changed for items with no product
Vendor Product Number	Vendor product number, this can be changed
Product Category	This cannot be changed ·        for product items ·        if a contract release order exists
Product Type	Proposed by the system for items with products from the product master, for example, the product type Material for normal items
Delivery Time	You can enter a delivery time in days.
Incoterm	International Commercial Terms
Price	A unique price can be changed here.
Target Quantity	Target quantity, this can be changed
Release Quantity	Release quantity display
Target Value	Target value, this can be changed
Release Value	Release value display

·        Conditions

You can create and process Conditions:

For more information, see Conditions in the Purchase Contract.

·        Locations

If an item is only authorized for release for specific locations, for example, plants, you can assign the number of the location here.

If you do not assign any location, the item is available for release for all plants.

You have the following options:

¡        Transfer Location into all Product Items

¡        Delete Location from all Product Items

·        Documents

You can enter vendor texts, internal notes, or attachments at item level.

·        Releases

A list shows the release orders for the item within a certain time frame (for example, in the last seven days). The list can contain release orders from purchase orders, confirmations, or invoices.

Activities

See Creating Contracts

See also:

·        Contract Determination in Sourcing

·        Purchaser

·        Sourcing of Requirements