Sales Processing using Third Party (w. Shipping Notification)

1. Sales Processing using Third Party (w. Shipping Notification) SAP Best Practices

2. Purpose, Benefits, and Key Process Steps • Purpose • In third-party order processing, your company does not deliver the items requested by a customer. Instead, you pass the order along to a third-party vendor who then ships the goods directly to the customer and bills you. The standard sales order automatically creates a purchase requisition for the materials to be delivered by the third-party vendor. • Benefits • Reducing stock and cost, increasing efficiency • Handover of customer’s requirements directly to external supplier • Invoice from trader to customer bases on quantities from supplier invoice • Fulfillment of customer’s requirements despite material shortage • Key Process Steps • Third Party Sales Order • Convert Purchase Requisitions to Purchase Order • Approval of Purchase Orders • Post Statistical Goods Receipt • Invoice verification • Billing

3. Required SAP Applications and Company Roles • Required SAP Applications • Enhancement package 5 for SAP ERP 6.0 • Company Roles • Sales Administrator • Warehouse Clerk • Accounts Receivable Accountant • Purchaser • Purchasing Manager • Billing Administrator • Accounts Payable Accountant

4. Detailed Process Description • Sales Processing using Third Party (w. Shipping Notification) • In this scenario, the vendor sends a shipping notification. After that a statistical goods receipt is posted. The incoming invoice from the vendor updates the billing quantity, so that the customer-billing document can only be created after entering the invoice from the vendor.

5. Process Flow Diagram Sales Processing using Third Party (w. Shipping Notification) Vendor Drop Ship Product to 3rd Party Send Shipping Notification/ Confirmation Incoming Vendor Invoice Customer Customer Request for Material Order Confirmation Billing Document Sales Administrator Create Sales Order (Optional) Change Order Quantity Auto-generates a Requisition Purchasing Manager / Purchaser Display List of Purchase Requisitions to Be Assigned Convert Assigned Requisitions to Purchase Orders Approval of Purchase Orders Ware- house Clerk Post Statistical Goods Receipt Billing Administrator Billing Accounts Payable / Receivable Accountant AP–OutgoingPayment (158) COGS Vendor Invoice Receipt AR–IncomingPayment (157) Sales: Period End Closing Operations (203) AP = Accounts Payable, COGS = Cost of Goods Sold, GR = Goods Receipt

6. Diagram Connection Legend <Function> Hardcopy / Document External to SAP Financial Actuals Business Activity / Event Budget Planning Unit Process Manual Process Process Reference Existing Version / Data Sub-Process Reference Process Decision System Pass/Fail Decision