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Third party drop ship free items scenario confusion...?

Former Member
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Hi all,

  So I'm pondering about a situation where a sales order is created with milestone material and a bill has been generated with the appropriate billing plan. The customer has been invoiced for, let's say 500,000 dollars. The material is of service type so with Item Category DIEN. Now during the process, the company let's say, X, needs to order materials from a vendor and have them delivered to the customer directly. The customer is not charged for those materials and delivery, as in, those charges are already included in the 500,000 milestone plan. So how can I make this situation work? The cost associated with the third party materials still has to be sent to the Project System, and mentioned in the invoice and included in the plan, but is not charged separately.

  I hope this is not too confusing. . Please let me know if you have any further questions. I would appreciate any input or advice. Thanks.

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Answers (2)

Answers (2)

former_member182378
Active Contributor
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Robin,

As you do not want to charge the customer, do the entire 3rd party sale process AS IS.

The amount you have charged the customer for the material and delivery, create a credit memo for the same amount. Thereby you have finally given those goods for free (first charged money for it, then given the money back).

Former Member
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Hi T W,

Thanks much for your response. I'm not sure if that's the way that is applicable to our business process. It makes sense though, but we can't use it. We just can't seem to figure out a way to get around this issue. I think we might be overthinking it a bit. I don't know if I made it clear that the third party sales order has to be on the same order as the milestone order by adding it as the second line item in that original sales order. The cost has to be recorded by the Project System. We can't create a separate sales order because everything points to a WBS element and we can't have 2 sales order pointing to the same element, since the third party material falls under milestone order. My head is spinning as I'm writing this btw. 

abhinav_sharma05
Active Participant
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Dear Robin,

You can raise a PO with ship to party as your customer and bill to & payer as your company. this bill can be settled against the amount you already get from the customer.

Thanks,

Former Member
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Hey Abhinav,

  Thanks for your reply. I will try out your suggestion and get back to you as soon as possible. A quick question though, the item category has to be TAS obivously, right?