Engineering Horizons



February 27
16:49 2015



Enterprise Resource Planning (ERP) software solution is a single software program that integrates all departments and functions across a company onto a single computer system that can serve various needs of a particular department. This runs on a single database to facilitate information- sharing and communication among departments.

Most ERP software is flexible enough to install some modules without buying the whole package. SAP offers an opportunity to replace independent systems of any organization with one tightly knit application. It was the first to integrate corporation functions into a single module system. SAP R/3 which is for client / server is distributed open system, was introduced in 1992. SAP materials management module consists of complete procurement cycle.

Determination of Requirement

In SAP MRP (Material Requirement Planning) feature use for the materials in the material master, the system automatically generates purchase requisitions for those materials which reaches to re-order point.

Determination of Source of Supply

SAP system helps the buyer to determine possible sources of supply. You can determine source of supply to create Request for Quotation (RFQs) and then enter quotations.

Vendor Selection

The system simplifies the selection of vendor by making price comparison between the various quotations. It automatically sends rejection letters.

Purchase Order Processing

The system facilitates data entry by providing entry aids when you are entering P/O.

Purchase Order Monitoring

The buyer can monitor the processing status of the purchase order online at any time and can determine

whether goods or an invoice have been received for this relevant P/O.

Goods Receipt

The system compares the goods receipt quantity with the P/O quantity.

Invoice Verification

Vendor invoices are checked for accounting of price and contents.

Payment Processing

Financial accounting normally deals with vendor payment.

Master Data in Material Master.

There are three inputs of master data.

  1. Material Master
  2. Vendor Master
  3. Info Record.


Material Master

The master data of a material contains its name, material group, unit of measurement its location in specific plant/storage location or the warehouse/storage bin, available stock and per unit cost of item.

Vendor Master

The vendor master consist of vendor address, bank address and details, Purchase order currency, incoterms and vendor’s tax data.

Purchasing Info Record.

You can store data for a particular material (for example delivery time and purchase price) on a vendor basis in info records.





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Engineering Horizons

Engineering Horizons

“Engineering Horizons” is the first & leading technical magazine of Pakistan covering Process, Mechanical, Metallurgical, Mining, Electrical & Electronics field under a single cover. We also feel pleasure in saying that this is the only magazine of its own kind & style, which is widely circulated in all Engineering Sectors of Pakistan.

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