Procurement Type
Procurement Type
Definition
Classification of a product that determines if it is produced in-house or procured externally or both.
Use
For each procurement type, there are specific source of supply types for in-house production (for example, production process models), and for external procurement (for example, transportation lanes). The procurement type has a control function for source determination: It defines which source of supply types the system takes into consideration when determining sources – for example, sources of supply for in-house production and external procurement or only sources of supply for external procurement.
You define the procurement type that should be used to procure a product in the location product master. The following procurement types are available:
The product is procured by in-house production.
The product is procured externally.
Both in-house production and external procurement are possible for the location product. This is the standard setting.
You do not plan location products with this procurement type in SAP APO but in an OLTP system.
In general, source determination uses the procurement type from the location product master. In the case of products that can be both procured externally and produced in-house according to the location product master, the application that calls up source determination can define that either only sources of supply for external procurement or only sources of supply for in-house production are taken into consideration. This is relevant to deployment, for example, that you use to distribute stocks for a product produced in-house over transportation lanes to various locations; in this case, only sources of supply for external procurement are relevant for source determination.