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Former Member

PP Related question

Hi one and all

If using SAP PP,Where are all the factories?

How does the valuation (prices) of material differ between all these places?

Thanq in advance

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2 Answers

  • Aug 21, 2007 at 10:32 AM

    Hi Anudeep,

    Based on the customer requirement a company can have any number of factories or plants in the same or different geographical location.

    But the inventory valuation will be done at plant level only.

    This is because the procurement, production cost vary form plant to plant.

    Example :

    Plant1 is located near Delhi & procuring an item from another company in Delhi

    If Plant 2 which is located in Bangalore procures the same item form the same source then the landed cost will me more..This results in price difference & hence the valuation has to be done at plant level



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    Former Member
    Aug 21, 2007 at 10:41 AM


    If you have the SAP PP module in your company the SAP itself will recommends you to maintain the valuation at the Plant level.

    Because valuation will be different based on the multiple plants/factories.

    The tax structure, frieght cost all the indirect cost will come into picture here, so your Costing will differ in each plant based on geographical location.

    Thats why the valuation will differ in all these plants.This is the best practice if you define the valuation level at plant level if you have SAP PP and Controlling module.



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