PGI after Invoicing process

[Former Member]

Dear All,

We have a scenario wherein due to lack of space in Factory, the goods is moved to an external warehouse and from there it is being dispatched to the Customer as soon as they get the clearance approval. The Excise Invoice and pre-shipment Invoice are raised when the goods move out of factory without the PGI . The PGI is done later when the goods move out of the external warehouse to the Ship-to- location. Subsequently the Commercial Invoice is created.

For this we had mapped external warehouse as Storage location and the scenario is working fine.

Now there is a case arised where the business wants to move the goods from the external warehouse to a C&F location in the region of the Ship-to-party so that there is no delay in the dispatch.

So the cycle will be Plant--> External warehouse> C&F location--> Ship-to-Party.

I would like to know the best way to map this scenario considering the process and the documentation.

Regards,

Karthik.

[Lakshmipathi · Accepted solution]

The simplest way is to have one more storage location for C&F so that the stock transfer will happen from External warehouse storage location to this C&F storage location. From there, once goods are moved, you can do PGI.

The other option is to go for consignment sales from C&F assuming that the ship to party is your end customer. Otherwise, this is not possible. Of course, for the scenario what you had narrated, the first one above would be most appropriate one.

G. Lakshmipathi

[jpfriends079]

Hello

Try Consignment business process for your requirement.

Regards

JP

[Former Member]

Hi as these are excisable goods whenever you make the goods movement you need supporting document its not something like you create as a Storage location,consignment ..... C&F loaction needs to be created as a Depot and process them as this will give you proper documentation whenever you make goods movment.

I want to ask the experts how they can produce Delivery note when they create C&F as Sorage Location ??????

[Former Member]

Hi JP,

Could you guide how the Consignment process can be used for this scenario.

The Outbound delivery is already made on the Ship-to-Party (final customer) from the Sloc i.e. External Warehouse. So how will the movement from External Warehouse to the C&F and then to the final customer will be mapped by Consignment process.

Thanks & Regards,

Karthik.

[Lakshmipathi]

You have to treat the C&F location as your ship to party and ship to party as sold to party if you would like to go with consignment process.

This means, once stock transfer is made from parent plant to external warehouse, the consignment process starts but I am not sure whether the scenario is a domestic or exports. If it is a domestic process, then tax and ED will come into picture in which case, you have to explain in detail as to how currently it is addressed.

G. Lakshmipathi

[Former Member]

Dear Lakshmipathi,

This is a domestic scenario from an EOU plant. The process is as I had mentioned earlier :

The Sales order is raised on the Sold to Party which is one and there are multiple Ship-to-party across India.

The goods needs to be dispacthed to the particular ship-to-party when a clearance is received from the them.

So when the outbound delivery is created the particular SLoc created as external warehouse is selected. The Invoice is raised based on which Excise I nvoice is generated.

The goods are moved to the External warehouse which is in near by location where they are stored till the clearance is recieved. Once the clearance is recieved PGI is done immediately and the Commercial Invoice is printed.

If it is this scenario it is not an issue since we have control on the stocks considering the Intransit Insurance etc. But when the goods are moved from External warehouse to the C&F which is in another state we cannot just map it as SLOC to SLOC transfer posting though logically it will serve the purpose.

Moreover the Outbound delivery is already created for the actual ship-to-party. So if we do the consignment stock transfer then how will the system get the stock when PGI is being done.

I hope the process is clear and you understand the requirement now.

Thanks & Regards,

Karthik.

[Lakshmipathi]

Let me correct if my understanding is wrong on the current process being followed.

a) Material is being sold to some X1 customer for which, a sale order is raised and that end customer is treated as a sold to party.

b) Once stock is made ready in parent plant, it would be moved to external warehouse which is treated as another storage location and you create a delivery, do PGI & Billing on X1 with Y1 as ship to party who are in another state for which the necessary tax and ED are levied in the billing document.

c) Though goods are invoiced, one more physical activity is being carried out that is it is being transhipped at C&F location and from there with the documents generated at second stage stated above, the goods are delivered to X1 customer.

I would also like to add that I am stil not clear on what clearance your client has got from statutory authorities to have a transhipment at c&f location. May be if you can explain this from legal point of view, to some extent, suitable proposal can be given.

Definitely, in this process, consignment sale wont work due to the fact that in consignment sale, you create a fill up on X1 as sold to party and B1 as ship to party. I am just giving an example from my explanation. This means, you can transfer the goods from parent plant to ship to party Y1 directly whereas in your case, external warehouse and C&F are coming into picture which cannot be addressed in SAP via consignment process.

G. Lakshmipathi

[Lakshmipathi]

In fact, if you configure Transportation, I think, your requirement can be achieved where you can treat the C&F location as transporter hub for which, two shipment document can be created for the same delivery.

G. Lakshmipathi

[Former Member]

Dear Lakshmipathi,

a) Material is being sold to some X1 customer for which, a sale order is raised and that end customer is treated as a sold to party.- Correct

b) Once stock is made ready in parent plant, it would be moved to external warehouse which is treated as another storage location and you create a delivery, do PGI & Billing on X1 with Y1 as ship to party who are in another state for which the necessary tax and ED are levied in the billing document.- Correct

c) Though goods are invoiced, one more physical activity is being carried out that is it is being transhipped at C&F location and from there with the documents generated at second stage stated above, the goods are delivered to X1 customer.- This is the new requirement which needs to be mapped.

I would also like to add that I am stil not clear on what clearance your client has got from statutory authorities to have a transhipment at c&f location. May be if you can explain this from legal point of view, to some extent, suitable proposal can be given.- Basically the sold to party i.e. the customer decides to which location the dispatch of the goods to happen.So based on that the dispatch is being done from the External warehouse. But the quantity which needs to be delivered to the Ship-to-party is known well in advance and hence the Outbound delivery is made but PGI is not done until the goods is actually shipped to the customer. The Trans-shipment from External Warehouse to the C&F location is being planned to avoid the delay in transit after the Customer gives the Dispatch clearance. Unless the clearance is given we cannot do the PGI as till that time it is the liability of the company.

Hope the scenario is clearer now.

Regards,

Karthik.

[Former Member]

Hi,

You can map C&F Location as a Non-Excisable depot and process.

Hope this helps.

Regards,

Sharan