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1 A Step by Step Guide to the SAP MM Inventory Management and Physical Inventory Configurations @ Page 1 of 80 SAP Version Table of Contents 3 IMG Menu The Starting 4 Start of the SAP MM Inventory Management 5 The Basic Material Master Configuration : Units of 5 Where does the user maintain the UOM?.. 7 Industry Type for Material 8 Delete or Add in Storage Location for the new 11 General Plant Settings in Inventory 11 Define the Attributes of System 13 Start of the Number Range 15 Define Number Assignment for Accounting 15 Define Number Assignment for Material and Phys.

2 Inv. 18 Define Number Assignment for 19 Start of the Individual Fields IMG 20 Field Selection for Goods Movements Initial/Header 20 Field Selection for 21 Field Selection per Mvt 21 Define Screen Layout for Movement 22 Settings for Transactions and Reference 24 Create Storage Location 26 Set Manual Account Assignment for Movement 27 Maintain Copy Rules for Reference 28 Set Up Dynamic Availability 29 Generate Physical Inventory Documents for Goods 32 Allow Negative 33 Set Missing Part 34 Default the Delivery Completed 35 For GR-Based IV, Reversal of GR Despite 36 Record Reason for Goods 37 How to Define, Copy or Change a Movement Types?

3 38 Default Print Control for Material 41 Define Stock List Display for 47 Define Valuation 49 Configure Automatic Postings to G/L 51 Storage Location Indicator to allowed/disallowed Physical Inventory 58 Configuration for Vendor 59 Business Process Flow for Vendor 60 The Initial Inventory during 63 Static versus dynamic data 66 A Sample note on Inventory Balance 66 Appendix A: The Inventory Goods Movement Configuration Links 67 Appendix B: Restrict the Storage Location from any Goods 68 Appendix C: Allows/Disallowed Goods Movement Posting to Previous 70 Appendix D: How to Archive the Materials Documents?

4 71 Appendix E: Configure the Cycle Count in 76 A Step by Step Guide to the SAP MM Inventory Management and Physical Inventory Configurations @ Page 2 of 80 SAP Version Copyright 2004 All rights reserved. makes no warranties or representations with respect to the content hereof and specifically disclaims any implied warranties of merchantability or fitness for any particular purpose. assumes no responsibility for any errors that may appear in this document. The information contained in this document is subject to change without notice.

5 Reserves the right to make any such changes without obligation to notify any person of such revision or changes. makes no commitment to keep the information contained herein up to date. Trademarks ABAP/4 is a registered trademark of SAP AG. SAP, R/2, R/3, SAPoffice, Smart Forms, SAPscript, SAP EarlyWatch, and SAP Business Workflow are registered trademark of SAP AG. All other products mentioned in this documentation are registered or unregistered trademarks of their respective companies. A Step by Step Guide to the SAP MM Inventory Management and Physical Inventory Configurations @ Page 3 of 80 SAP Version Objective The objective of this paper is to provide the SAP MM consultant with a step-by-step guides at configuring the SAP MM Inventory Management module.

6 It is structure in the form of how-to-do configurations method. When you do the SAP configuration, sequence is not really important as long as all the MM Inventory Management modules Features that need to be used have been configured. Notes: Initial IMG Action : Required (this are dynamic data which are unique to the company) Initial IMG Action : Usually Not required (it depends on the customer requirement) Initial IMG Action : Not required (normally this kind of configuration is quite static, most of the customer will accept the SAP default and may request for changes after going live for a period of time) A Step by Step Guide to the SAP MM Inventory Management and Physical Inventory Configurations @ Page 4 of 80 SAP Version IMG Menu The Starting Point Before doing any SAP Configuration (or IMG), all SAP consultants MUST be aware of the transaction SPRO.

7 This transaction code is the heart of the whole SAP configuration. Click the button and you will be shown all the configuration tree for the various SAP modules like SD, PP, FI, CO etc. Transaction SPRO The SAP IMG configuration tree for all the modules A Step by Step Guide to the SAP MM Inventory Management and Physical Inventory Configurations @ Page 5 of 80 SAP Version Start of the SAP MM Inventory Management Configurations Now, you will go through each of the SAP Inventory Management Configurations to get your SAP Inventory transaction functioning.

8 After all the configurations are completed, Appendix A: (The Inventory Goods Movement Configuration Links Explain) will link all the related configurations for you so that you can understand the relationship. The Basic Material Master Configuration : Units of measurement Initial IMG Action : Usually Not Required As a rule of thumb, always RECOMMEND the user to set the base unit of measure for a material to the smallest unit that can be used. That is, don't set it as FT (foot), but set it as IN (inch). Never set EA as base unit for something that can be divided and consumed in smaller quantities.

9 Please take note that you CANNOT change your Base Unit of Measure once there are any OPEN TRANSACTIONAL POSTING done by the user. For Available Stocks, Open Purchase Order, Open Production Order, Dependent Reservations already exists, Open Sales Order etc. If you try to change, a SAP message will appear asking you to click the button. It will list all the OPEN DOCUMENTS to you. Tip: Determine the lowest UOM as the Base Unit of Measure Transaction : CUNI Menu Path : IMG General Settings Currencies Check units of measurement Click the button Units of measurement to see the UOM settings.

10 A Step by Step Guide to the SAP MM Inventory Management and Physical Inventory Configurations @ Page 6 of 80 SAP Version Double click on the Unit to see the individual UOM settings. Create the New button to create a new UOM. A sample of a UOM settings. You can ignore the ALE/EDI sections if your company is not using any EDI. A Step by Step Guide to the SAP MM Inventory Management and Physical Inventory Configurations @ Page 7 of 80 SAP Version Where does the user maintain the UOM?