Attribute that subdivides materials with the same properties into groups.
To enable different materials to be managed consistently in accordance with company requirements, materials with the same properties are divided into groups and assigned to a material type. Examples of such groups:
Raw materials (ROH)
Semifinished products (HALB)
Finished products (FERT)
Materials procured externally (FREMD)
Process materials (PROC)
Trading goods
Operating supplies
Each material is assigned to a material type to designate it as a raw material, semifinished product, finished product, and so on. This assignment automatically defines various control parameters for processing the material.
For costing, the material type controls:
Whether a costing view can be created in the material master record for a material of that material type
Whether a material of that material type is normally costed in a cost estimate with a quantity structure (that is, using BOMs and routings), or without a quantity structure (manually, using unit costing)
Whether the value and quantity for the material for the relevant plant is shown in the material master record
How the material is assigned to the stock and consumption accounts in Financial Accounting
You specify which control parameters are linked to the material type in Customizing for Logistics General .
Note
A costing view can only be created by the system if the Costing indicator is set for a material type. If no costing view exists in the material master record, the system creates a costing view when you cost the material.
You can use the material type to specify that the With quantity structure indicator is set as a default when you create a material master with this material type. The With quantity structure indicator specifies that materials of this material type will generally be costed using material costing. If the indicator is not set, the system looks for an existing material cost estimate without quantity structure. If no cost estimate without quantity structure exists, the material is costed as a raw material.
In the standard system, the material types for raw materials, semifinished products, and finished products are defined in such a way that materials with these material types can be costed with material costing.
You can reset the With quantity structure indicator manually in the costing view of the material master record.