MRP Views in Material Master SAP
The MRP 1 view is the first of 4 MRP views on the material master. The MRP 1 View is a place holder for defining the Planning methods and lot sizing procedures of a give material at a plant/storage location level. MRP stands for “material requirements planning”, which aims to guarantee material availability. MRP is necessary to procure or produce quantities of material for internal purposes or external sales.
The four MRP views contain many fields relevant to planning and production, but only a few are of importance to product costing. The MRP 1 view consists of general data, MRP procedures, and lot size data (Figure 3.2).
Figure 3.2: Material Master MRP 1 view
PD – Relevant for Material Requirement Planning
ND – No Planning in SAP
VB – Manual reorder point planning (Consumption based planning)
VM- Automatic reorder point planning (Consumption based planning)
VV – Forecast based Planning
X0 – External Planning i.e., APO or BAAN or I2 or MES or any other external planning system.
MRP types can also be configured to the requirements, but most of the times, standard MRP types are used.
Plant-specific material status
Plant-specific material status is a field that affects whether a material is costed or an error or warning is issued during purchasing or production. The plant-specific material status restricts the usability of the material for the plant concerned, that is, it defines whether a warning or error message is displayed if you include the material in a particular function. Plant-specific material status differs from the cross-plant material status on the basic data 1 view because the status is maintained for each plant. This allows flexibility if a material becomes discontinued or obsolete in one plant, but not others.
Indicates whether, for a specific plant, the material may be used in the following areas:
- Materials management (for example, in purchasing and in inventory management)
- Production planning and control
- Plant maintenance
- Warehouse management
- Costing with a quantity structure
Typically, the plant-specific material status is set when a material is discontinued or obsolete. A discontinued material may need to be costed, but should no longer be purchased, because it will be replaced. An obsolete material will likely not need to be costed again since the inventory will be sold or scrapped. The valid from field can be used to specify when the plant-specific material status became valid.
The configuration for plant-specific material status can be accessed through transaction OMS4 or through the IMG menu pathCONTROLLING • PRODUCT COST CONTROLLING • PRODUCT COST PLANNING • MATERIAL COST ESTIMATE WITH QUANTITY STRUCTURE • SETTINGS FOR QUANTITY STRUCTURE CONTROL • MATERIAL DATA • CHECK MATERIAL STATUS.
Assembly scrap percentage
Non-conforming material that cannot be reworked or used and has no value except for its material content.
The following are the various scraps that are maintained
1. Assembly Scrap
2. Component Scrap
3. Operation Scrap
Assembly scrap percentage
- Percentage scrap that occurs during production of the material if the material is an assembly.
- Takes into account all faults that occur when the individual components of an assembly are assembled (in production).
- Maintained in the Material Master – MRP 1 View as a percentage
- Assembly scrap is used in materials planning to calculate the lot size of the assembly. The system increases the quantity to be produced by the scrap quantity calculated.
- indicates the expected scrap from a material during production. This scrap rate is relevant to product costing because additional components are required to offset the amount of scrap.
The MRP 2 view consists of procurement and scheduling fields as well as details around net requirements calculation (see Figure 3.3).
Figure 3.3: Material master MRP 2 view
The procurement type field is a key integration point between logistics and product costing because the entry in this field determines how you will cost a material. When the system determines the procurement element, it first asks whether procurement should take place via in-house production or external procurement.
E: In-house production
F: External procurement
X: Both procurement types
If a material has procurement type E, produced in-house, SAP will look for a BOM and routing when costing this material. If no BOM or routing is found, the system will produce an error message.
If a material has procurement type F, external procurement, the system will look for a price using the configuration strategy in the valuation variant. There are a variety of options for selecting a price for a procured material. You could use the purchase information record, which is the master record containing the price from the vendor. You could also use a planned price field, tax or commercial price field, or a current or future price.
Finally, if a material has procurement type X, both procurement types, the system will first search for a BOM and routing. If the system cannot find a BOM or routing, it will continue to search for a price using the same strategy in the valuation variant used for procurement type F, externally procured, materials.
Note that the system does not produce a hard error if a BOM is found, but a routing is missing. There are situations where a material is produced purely with materials and no routing activities are required. The system will produce a warning message that can be ignored, or configured not to appear.
Special procurement type keys
The special procurement type is used to precisely define how in-house production and external procurement is to be carried out.
You cannot configure additional procurement types, but you can use special procurement keys to alter how the system treats materials with different procurement types.
Special procurement key
The special procurement key, or special procurement type, can be used to further distinguish the procurement type. For example, a material may have procurement type F indicating that it is procured externally, but the special procurement key can be used to indicate that it is subcontracted, or that it is produced at an alternate plant.
When costing a material, the system will look at the special procurement key on the MRP 2 view unless a special procurement key for costing is indicated on the costing 1 view.
Special Procurement Keys:
20: External procurement
40: Stock transfer (procurement from alternate plant)
45: Stock transfer from plant to MRP area
50: Phantom assembly
52: Direct production / collective order
60: Phantom in planning
70: Withdrawal from alternative plant
80: Production in alternative plant
The configuration for special procurement type can be accessed through transaction OMD9 or through the IMG menu pathPRODUCTION • MATERIAL REQUIREMENTS PLANNING • MASTER DATA • DEFINE SPECIAL PROCUREMENT TYPE.
Backflush refers to the automatic issue of component materials during a production confirmation. Materials can either be backflushed, or can be directly issued to confirm on an order. Backflushing saves the manual work of direct issuing materials to an order. The backflush checkbox in the material master can be selected in order to default the backflush indicator in production orders.
1: Always backflush
2: Work center decides whether or not to backflush
Materials that are expensed at a work center and do not require a cost estimate can be indicated with the bulk material checkbox. Since their cost is expensed to a cost center, they can be included in an overhead rate in order to account for the cost in a finished material. A bulk indicator can also be selected directly in the BOM item detail.
The MRP 4 view consists of several fields that indicate how a BOM is exploded, discontinued, and repetitive manufacturing settings (see Figure 3.4).
Figure 3.4: Material master MRP 4 view
Methods are used in object determination and inactivation. Methods are procedures for selecting objects or for defining a condition for activation.
The Selection field determines which Alternative Bill of Material the system selects during the MRP run. It is a Standard SAP Pre-configured selection.
With Selection only by production version, the system chooses the alternative BOM defined in the valid production version. The lot size range and area of validity of the production version apply. If no production version is found, no production orders or process orders can be created.
You can indicate a selection method to determine how an alternative BOM is selected based on MRP and costing purposes. A production version is an option for selecting BOMs. A production version is a unique combination of a BOM and Routing.
<blank> : Selection by order quantity
Selection by explosion date
Selection by production version
Selection only by production version
Selection by order quantity (<blank>) means the system will choose an alternative BOM according to a lot size range that matches the order quantity. The system will choose a BOM with a lot size for costing that matches the costing lot size.
If you select ‘Selection by explosion date’ (1), the system will choose an alternative BOM based on configured validity dates. The configuration for this selection can be accessed in transaction OS32 or through the IMG menu pat
CONTROLLING • PRODUCT COST CONTROLLING • PRODUCT COST PLANNING • MATERIAL COST
ESTIMATE WITH QUANTITY STRUCTURE • SETTINGS FOR QUANTITY STRUCTURE CONTROL • BOM
SELECTION • CHECK ALTERNATIVE SELECTION FOR MULTIPLE BOM.
Selection by production version (2) will result in the alternative BOM based on the lot size range and validity range of a valid production version. Similar to selection by order quantity, the system will choose a production version with a lot size for costing that matches the costing lot size.
Selection only by production version (3) will act the same as option 2, but if no production version is found, no production orders or cost estimate can be created.
The production version button can be clicked to display all production versions for a material. This button is helpful when researching material data and determining if a production version exists.
The production version is the link between a product BOM (Bill of Material) and the process Routing. It determines which alternative BOM is used together with which routing to produce a material or plan a material.
There may be different production versions based on the lot sizes and validity dates.