Consignment and Pipeline Settlement 

Use

Consignment material is stored at your company premises but belongs to a vendor. The vendor supplies these goods so that they are available to you at any time, but does not initially invoice you for the goods. Only when you have withdrawn stock does payment become due for the quantities used.

Pipeline material flows directly into the production process. This could be from a pipeline, for example, oil, from a pipe, for example, water, or from a cable, for example, electricity. Payment is due after each withdrawal.

The use of consignment and pipeline settlement reduces the cost of stockholding in the company by:

And, for a modest capital tie-up, increased security of supply is guaranteed with minimal inventory levels and short lead times.

Features

You do not expect an invoice from the vendor for goods withdrawals from consignment stocks or a pipeline. Instead you settle posted withdrawals and return deliveries yourself and send the vendor a statement of the settlement. You can perform this settlement periodically in the background. The following documents can be involved:

Consignment settlement is connected to message determination. As a result, you can define a form in Customizing. A message record is created during each settlement. This message record completes the form. Depending on the system settings, you can send this form to the vendor immediately on posting or at a later time.

See also:

Consignment

Pipeline Handling