Skip to Content
avatar image
Former Member

Third Party

Dear Experts,

Can anybody please give me the steps of Third Party. Thanx in Advance


Add comment
10|10000 characters needed characters exceeded

  • Follow
  • Get RSS Feed

4 Answers

  • Best Answer
    avatar image
    Former Member
    Sep 20, 2007 at 08:28 AM


    Customize the third party sales in summary:

    1. Create Vendor XK01

    2. Create Material – Material Type as "Trading Goods". Item category group as "BANS".

    3. Assign Item Category TAS to Order type that you are going to use.

    4. A sale order is created and when saved a PR is generated at the background

    5. With reference to SO a PO is created (ME21N). The company raises PO to the vendor.

    6. Vendor delivers the goods and raises bill to company. MM receives the invoice MIRO

    7. Goods receipt MIGO

    8. Goods issue

    9. The item cat TAS or Schedule line cat CS is not relevant for delivery which is evident from the config and, therefore, there is no delivery process attached in the whole process of Third party sales.

    10. Billing *-- Seema Dhar

    SD - 3rd party sales order Create Sales Order


    Order Type

    Sales org, distr chnl, div


    Sold to

    PO #





    SD - 3rd party sales order View the PR that is created with a third party sales order


    Order Number

    Goto Item Overview

    Item ->Schedule Item

    SD - 3rd party sales order View the PR that is created


    Key in the PR number


    SD - 3rd party sales order Assign the PR to the vendor and create PO


    Key in the PR number

    Toggle the "Assigned Purchase Requisition"


    Check the box next to the material

    Assign Automatically button

    Click on "Assignments" button

    Click on "Process assignment"

    The "Process Assignment Create PO" box , enter

    Drag the PR and drop in the shopping basket


    SD - 3rd party sales order Receive Goods


    PO Number

    DN Number

    Batch tab , click on classification

    Serial Numbers tab

    Date of Production

    Flag Item OK

    Check, just in case



    SD - 3rd party sales order Create Invoice


    Invoice Date

    Look for the PO , state the vendor and the Material

    Check the box

    Clilck on "Copy"

    Purchase Order Number (bottom half of the screen)


    State the baseline date

    Simulate & Post

    Invoice Number

    *Invoice blocked due to date variance

    SD - 3rd party sales order Create a delivery order


    In the order screen , go to the menu Sales Document , select "Deliver"

    Go to "picking" tab

    State the qty and save

    SD - 3rd party sales order Create a billing document


    Ensure that the delivery document is correct in the


    Go to edit -> Log


    Add comment
    10|10000 characters needed characters exceeded

  • Sep 20, 2007 at 08:04 AM


    Third party order processing is as follows:

    Assume three companies X, Y and Z

    X - The company,

    y - The customer

    Z - Vendor

    When ever X gets a PO from Y to supply some goods, X has an option of either manufacturing those goods or procuring those goods.

    If he is procuring the goods, there are two methods that are generally followed:

    Method 1) After receiving the PO from Y, X creates a sales order against Y.

    Now at the same time he also creates a PO to a vendor Z to produce the goods

    Z produces the goods and supplies to X

    X receives the goods from Z

    Then X delivers the same goods to Y.

    After that X invoices Y and Z invoices X.

    Note : Here there is no direct/ Indirect relation between Z and Y.

    This process is known as Trading Process. and the Material here is created with Material type HAWA.

    The other method is a Third party order processing method:

    Here the glaring difference is that instead of Z supplying the material to X and X in turn supplying the same material to Y.

    X authorizes Z to supply the material to Y on his behalf and notify him once the delivery is complete.

    Now Z supplies the material to Y and acknowledges the same to X.

    Z will send a copy of delivery acknowledgement and invoice to X.

    After receiving the delivery confirmation and invoice from Z, X has to verify the invoice and this process is known as invoice verification and is done in SAP through Tcode MIRO.

    The next step for X is to create an invoice and submit to Y

    Only after the invoice verification document is posted then only X can create an invoice for Y.

    This is the business flow that is followed for third party order configuration.

    There are few steps that have to be configured to enable the system to function as mentioned above.


    If you are always followwing a third party process for a material then you have to create the material using item category group BANS.

    The procument type should be marked as External procurement (F) in MRP 2 view of the material master record.

    if you are not always allowing third party order processing then u can create a material master record with item category group as NORM and the procurement type should be marked as ( X) meaning both types of procurment ( in house manufacturing and external procurement).

    step 2)

    the item category in the order should be manually changed as TAS.

    For that you need to confugure the item category determination

    ord type + item cat grp + usge + Hiv level = Item cat + Manual item cat

    OR + NORM + + = TAN . + TAS

    OR + BANS + + = TAS

    Step 3)

    make sure that during the item category configuration for TAS you need to mark relevnat for billing indicator as F

    step 4)

    The schedule line cateogry for this type should be CS.

    make sure that you mark subsequent type as NB - purchase requisition in this schedule line category as this will trigger the purchase requision order immediately after the creation of the sales order and the PO to vendor is created against this purchase requiesion.




    Add comment
    10|10000 characters needed characters exceeded

  • avatar image
    Former Member
    Sep 20, 2007 at 08:04 AM

    Hi Deepak,

    Mail sent to ur mail id.

    Reward if helpful,


    Add comment
    10|10000 characters needed characters exceeded

  • avatar image
    Former Member
    Sep 22, 2007 at 10:54 AM

    Thanx to all

    Add comment
    10|10000 characters needed characters exceeded