Rate Contract and Work Contract

[Former Member]

Dear All,

We have a requirement of Rate Contract and Work Contract in SAP.

Request you all to please share your experience to map the process in system.

Thanks,

[ravi_jadhav · Accepted solution]

Hi

Create a Value Contract:-

Enter target value & validity

Hope thois helps

Regards,

Ravi

[ravi_jadhav · Accepted solution]

For scenario 2: create service PO with item category D

[Prasoon]

Hi,

   The rate contract is defined as value contract in SAP. The same can be created in ME31K with document type WK.

   For work contract, you may go for service PO with item category D or value contract with item category D.

Regards,

AKPT

[former_member183155]

Hi all ,

I think that there is not a material master. For this reason , standart behaviour halps us with WK Value contract with item catagory M or W .

Item catagory W is used only for value contract. For example ; you do not have material master , you can manage your contract with material group. You can create contract with item catagory W , Sap will benefit from price of material group, also you can change material text.

Regards.

M.Ozgur Unal

[former_member183424]

What do you mean by rate contract and work contract ?

SAP provided two types of contract

1. Quantity Contract

2. Value Contract

Can you explain your business process for rate contract and work contract.

[Former Member]

Thanks for your reply.

Following are two exmple :

1. Computer Annual Maint. Contract. where rate is fixed for one year or for next 2-3 years. We are relasing payment every 3 months or 6 months or yearly depending on Terms.

2. Civil work : For constructing compound wall. We are giving contract to Vendor with material. As per the condition with the Vendor, he will raise the bill for Material or/and Labor Charges etc. after complition of say 10% or 20% of work or any other terms depending on work.

Thanks

[Prasoon]

Hi,

   In case of case 1, you may create a service PO with item category D and invoicing plan, which will be useful for periodic invoicing. Please check the help doc: Invoicing Plan (SAP Library - Purchasing (MM-PUR)) You may enter the validity period in PO and create new service PO once the rate changed.

   Case 2 would be a normal service PO where you can create service entry sheet and raise the invoice whenever required.

Regards,

AKPT

[former_member183424]

What is most prior in both situation??

Value or quantity ?

I think value will be most prior for 1st option.. Then use value contract..

Second, you said your are using Vendor with material.. Does it means you have to maintain Quantity ?

I suggest please read about contract..Contract (SAP Library - Purchasing (MM-PUR))

[Former Member]

Is there any standard reports to track contract which shows complete transaction flow.

i.e. Contract Value, PO Value, Invoice Value etc.

[Prasoon]

Hi,

  You may check ME3M, ME3L, ME3N transactions with document types MK or WK (or the contract document type used).

Regards,

AKPT

[former_member183424]

You can check the release documentation for contract...

Read the sap help Displaying Release Documentation for Contract (SAP Library - Purchasing (MM-PUR))