Basic Questions about the Goods Issue

[Former Member]

Hello guys,

I'm actually quite new to SAP. I'm still learning from the basics and I've been exposed to SAP only from reading, so if you can help answer these question, that'd be great:

1. This is how I understand the flow of sales:

Sales Orders are made according to sales requests. Delivery Order form is made to send the products to customers (Move inventory to in transit). When materials are accepted by the customers, we can post Goods Issue form to record this.

Is this correct?

2. Is Goods Issue a separate and different form from Delivery Order?

3. Is Goods Issue a separate and different form from Goods Receipt?

4. What if you send 10 of product A to customer XYZ, but they only accept 8 pcs and 2 pcs are returned to our warehouse.

What form do I use to record these 2 pcs that are returned ? Do I use Goods Issue form or Goods Receipt form?

thanks a lot!

[Former Member]

Hi,

Normal Sales Cycle based on the confirmed Sales Order we initiate Delivery Order.But the ownership of the goods has to be transferred from our account to customer account.

So We do PGI which is stated as Post Goods issue.Here the integration with MM and FI happens where our inventory stock as well as Value gets reduced from our books of account and updates In COGS account.COGS-Ie cost of Goods Sold.

Now if the customer returns the goods creates a return PO and sent the goods to our premises where we do a return order(Order type "RE) and after inspection takes the goods back to our return storage location so here again our inventory stock as well as value has to come in our owbnership for that we do PGRie Post Goods Receipt where COGS gets reduced and inventory adds on.

Regards,

Saju.S

[Former Member]

Hi,

Post Goods Issur (PGI) is the last step of sales. The PGI will be made with referene to the delivery.

Incase there are two items sent back once the PGI is complete you will need to create a returns order and do a Good Receipt for those two items.

Please take a look at:

http://help.sap.com/saphelp_crm40/helpdata/en/dd/560ac1545a11d1a7020000e829fd11/content.htm

http://help.sap.com/saphelp_45b/helpdata/en/c6/f84a474afa11d182b90000e829fbfe/content.htm

Plus ther eis a lot of content available on the forum.

[Former Member]

Hello, thanks for the reply and the useful links

If I understand you correctly, Goods Issue is a different form from Delivery Order? and is used to indicate that the products had indeed been delivered and received by customer?

"Incase there are two items sent back once the PGI is complete you will need to create a returns order and do a Good Receipt for those two items."

If I undertsand you correctly, do you mean the vendor has to create a return PO, return the item to us and then wait for our credit note? Can you please elaborate ?

What if the customer refuses to accept 10 pcs, but only accept 8 pcs at time of delivery ?

thanks a lot guys 😃

[former_member209761]

Dear Surfol,

1)Goods Issue is a different form from Delivery Order?

YES, we can do delivery first and then do a PGI.

Or we can directly do the PGI,which means that delivery will also be created.

If we do delivery alone, no material/accounting entries are created.

I.e the stock will not be reduced.

our inventory account will not be hit.

If we do PGI, it means stock has left out plant/premises.

Stock will be reduced.

Material document will be created/accounting entries will be posted.

and is used to indicate that the products had indeed been delivered and received by customer?

NOT EXACTLY.

When we do PGI, it only means that the stock has left our plant. It does not mean that the customer has received it.

For that we use Proof of delivery (you can search of POD/proof of delivery + sap in the forums)

2)"Incase there are two items sent back once the PGI is complete you will need to create a returns order and do a Good Receipt for those two items."

If we have not billed the customer, then we can reverse the PGI and then the stock will be back in our stock.

But as your case explains, if we have invoiced for a total of 10 and the customer returns 2, we create a return order with refernance to the invoice , and then we do a return delivery.

3)If I undertsand you correctly, do you mean the vendor has to create a return PO, return the item to us and then wait for our credit note? Can you please elaborate ?

I did not understand this.

4)What if the customer refuses to accept 10 pcs, but only accept 8 pcs at time of delivery?

If we have created an order for 10, and before the delivery is made, customer says he needs only 8.

In that case we make a delivery for 8 and do the PGI for 8

we can later come back to the sales order and reduce the order qty from 10 to 8

Now if we had already done a PGI and the goods reached the customer and in transit 2 pieces where damaged and the customer refuses to take those 2, we will be creating a return order for those 2 qty.

Hope its clear for you.

Thanks & Regards,

Hegal K Charles

Edited by: Hegal . K . Charles on Jul 16, 2011 4:02 PM

[Former Member]

yes the goods issue is carriedo ut when the delivery is created & the goods actually leave your premises. The available stock is deducted & the an entry is made to accounts.

For confirmation of products reached the cusomer the POD (Proof of Delivery) can be used

If the PGI is complete and the billing document created you will have to create a returns order and go a PGR, if no returns order is created you can reverse the PGI for 2 items. In case they items are rejected we should created a Returns Order.

We create the returns order with reference to other the Billign document or the Sales Order

If the customer does not accept 2 items, this is similarto point 2, you might want to record the reason for the rejection & a returns order should be created.