What is the Procurement Process and procedure in the SAP

 

SAP MM - Procurement Process

The process of buying materials and obtaining services from vendors or dealers is called procurement.It is subdivided into following parts −

• Basic Procurement
• Special Procurement
• 
  

• Basic procurement is a process of acquiring goods or services in the right quantity, at the right price, and at the right time. However it is critical to maintain a right balance between quantity, price, and time

Structure of the Procurement Type:-

Sr.No.	Procurement Activities & Description
1	Determination of requirement It is the logical subdivision where it is determined what material or services are required, and which supplier can fulfill the requirements.
2	Creating Purchase Requisition It is the phase in which the purchasing department is informed about the requirement of items or services. A requisition is an internal document.
3	Creating Purchase Order It is the phase when an order is created from requisition and it is approved and assigned to a supplier.
4	Goods receipt/ Invoice Received It is the phase in which the material is received by the company and its condition and quality are being inspected. In this phase, an invoice is received from the vendor (seller).
5	Invoice verification/ Vendor Payment It is the phase in which the vendor (seller) is paid from the company and reconciliation of the invoice and PO is accomplished.