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How are POs and Contracts are related?

We are ABAP4 developers and pretty new at MM module. We would be appreciated if some MM experts here can tell us the relationship between Contracts/RFQs and POs!

Thanks and we will give you points!

Former Member
Former Member replied

Yes you are right. Contract is like a Outline purchasing agreement and against which we can release any number of purchase orders till the contract terms and conditions are met in a overall time frame. These purchase orders are also called as a contract release orders

Basically Contracts are in two forms

Value contract and quantity contract

in this terminalogy release means release of purchase order against contract

Hope this helps



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