SAP MM Reference Purchase Organization

SAP MM Reference Purchase Organization

 

A>Reference purchase organization does not have Plants assigned to it, not assigned to any company code either.

B>It is basically a purchase organization that is referenced by other purchasing orgs. This way, the enterprise can leverage the benefits of centralized purchasing.

C>It is a purchasing organization that can be set up as a strategic purchasing department

D>It is reference for all the other existing Purchase organization. It is not assigned to either to plant or comp code. The contracts, terms and conditions can be utilized by other purchase organizations.

E>Reference purchase Organization is used when there is no centralized purchase organization. You have to define one purchase organization as reference purchase organization and link other purchase organizations to this reference purchase organization. When you create a contract using this purchase organization and this contract can be used by other purchase organizations which are linked to this ref. purchase organization. 

Reference purchase organization is basically used for better negotiation.     

For example - You are having 2 plants (A & B) of 2 different company code(A & B).

1. Purchase organization A is assigned to company code A & plant A

2. Purchase organization B is assigned to company code B & plant B.

3. Reference purchase organization C is created and linked to purchase organization A and B.

Scenario -

Vendor A can supply Material A 1000 qty at price 100 whereas more than 1000 qty at price 90.

But your requirement for Plant A is 800 qty and Plant B is 700 qty.

If you create a contract on plant basis to the Vendor A then you have to pay price 100.

But if you create a contract with reference purchase organization C for total requirement of qty 1500 without plant basis then rate will be only price 90.

Then this contract can referred by both the plant and can be converted to P.O at price 90.

 

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