Benefits of implementing Central Contracts in SRM 7.

[former_member524065]

Dear Experts,

Picture the following:

- Classic Scenario.

- One ECC 6 EHP 4 Back end.

I'm currently exploring the benefits of implementing Central Contracts against using only Purchasing Contracts in ECC and replicating them to SRM for use in the Shopping Carts.

So my question is why would you implement central contracts in SRM instead of just replicating these contracts from ECC? What benefits would you get out of having central contracts in place against having only Purchasing Contracts in ECC?

Thanks for your input.

[Former Member · Accepted solution]

Hi

On SRM7.0 central contracts you have following which will be beneficial for business;

1. Central Contract hierarchy: contract hierarchy can be maintianed and any discounts based on relase qty. will be beneficial.

2. Alerts for contract expiry can be activated based on time frame, contract value...

3. If SRM system has been connected to different ECC backend then contract can be created, maintained and distributed centrally from SRM system.

4. in calssic scenario the central contracts can be reffered as source of supply for both SRM and ECC side.

with regards

Manjunath

[former_member183819]

adding to Manju one point .

- Procurement department(PURCHASER) can use web interface to create / manage contracts rather GUI interface and quick contract creation / maintenance

- Approval mechanism simplified with less efforts.

- Different ways to create a contract from SRM

Copy an existing contract

Use an existing template

Upload an external file

Upload a contract from the catalog

Muthuraman

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1.You can use this business process to access SAP SRM contract features, such as contract hierarchies, discount across contract hierarchies, and grouping logic, when determining source of supply in SAP ERP.

2.You can create a central contract in SAP SRM, and it can then be used as source of supply in both SAP SRM and SAP ERP. Relevant data is sent to SAP ERP for a source of supply determination, and a specific type of contract or scheduling agreement can be created there.

3.While determining a source of supply, you can access central contracts directly.

4.The price is determined in SAP SRM before the SAP ERP purchase order (PO) is sent to the supplier.

5.You can create and change central contracts and renegotiate existing contracts directly with a supplier, or through the creation of an RFx. You can automatically assign a contract as a source of supply, or it can be listed as one of numerous potential source of supply contracts. A strategic purchaser can create a contract whenever they anticipate a long-term relationship with a supplier.

6.Contract management enables purchasers from various parts of the company at different locations to take advantage of the terms of globally-negotiated contracts for specific product categories. You can provide users with specific levels of authorization to contracts, and you can categorize documents as confidential.

6.You can distribute central contracts to release-authorized purchasing organizations, and these organizations can then use them as source of supply in the appropriate SAP ERP system. Hierarchies can be used to organize, structure, display, and search for contracts.

7.If you use SAP NetWeaver Business Intelligence (SAP BI), you can view various consolidated reports of contract management. For example, you can view aggregated value released against all contracts in a contract hierarchy.