SAP Business One Purchasing Process
Does your company purchase items for resale? If so, then you will maintain a minimum inventory level for some of the items. When the amount of stock you have for those items is low, you most likely reorder the items using a procurement process with 4 steps: purchase orders, goods receipt POs, Accounts Payable (A/P) invoices, and outgoing payments to the vendor. In SAP Business One (often referred to as Business One or SAP B1), the tasks related to purchase orders, goods receipt POs, Accounts Payable (A/P) invoices, and outgoing payments to the vendor is automated and streamlined for you so that it saves you and your staff time and money.
Simple Procurement Process
You purchase items from external vendors and typically use the full procurement process. The order is sometimes submitted by phone and the items are delivered immediately by the vendor. For example, a minimum number of inventory items is needed to fulfill regular customer orders quickly. When the stock dips too low, purchase orders are used to begin the purchasing process. When the vendor delivers the items that were ordered, a goods receipt PO is created. After the items are inspected, an A/P invoice can be created. The A/P invoice triggers an outgoing payment to the vendor.
The Purchase Order Document in Business One
A purchase order is a commercial document issued by a buyer to a seller. The purchase order defines the items or services that the seller will provide the buyer. The purchase order includes the agreed-to quantities and price for the products listed. How is the information stored in the purchase order used? Normally, when goods are received, purchase orders are matched with packing slips and vendor invoices. After the purchase orders are put together with the packing slips, the invoices are paid.
Matching the Purchase Orders With Packing Slips and Vendor Invoices Process is Automated
In SAP Business One, you never have to enter data twice.„ This process is automated: the purchase order can be linked to the goods receipt PO, which shows information from the packing slip. This can then be linked to the A/P invoice which contains the information from the vendor’s invoice. This automation allows information to be consistent and the integrity of the documents to be retained throughout the process. When a purchase order is added in SAP B1, no value-based accounting changes occur. However, the order quantities are listed in inventory management. If you’d like to see the items and quantities on order, you can quickly and easily view them in various reports and windows, such as the inventory status report and the Item Master Data window. Obviously, having such real-time access to this information can play a key role in optimizing a company’s purchasing and inventory management business processes. The automation of manual financial procurement and purchasing transactions can save your business an inordinate amount of usable employee time.
Items Related to Purchasing
- Link to purchasing analysis
- Unit of measure
- Item dimensions
- Manufacturer catalog number
- Preferred vendors
- Customs group for imported items
- Tax information
Purchasing Item Categories
- Inventory item
- Sales item
- Purchased item
Quick Purchasing Module Review
The basic steps of the process are: the goods receipt PO, the purchase order, the outgoing payment and the A/P invoice. The two types of information involved in purchasing are item master data and vendor master data. The only required document is the A/P invoice in a streamlined purchasing process. The A/P invoice is made to increase inventory when a goods receipt PO is not referenced as a base document in the invoice.
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