SAP MM - About Procurement Process

Companies' procurement procedures have a lot of room for improvement. Purchasing should be efficient; however there are a slew of inefficient procedures in procurement administration. Paper-based procedures in several locations — the procurement process is already obscured by a lack of transparency, and many other phenomena, such as maverick buying, are the outcome. Enroll yourself in the SAP MM Online Training to gain the detailed knowledge about the platform.

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Procurement in Materials Management:

To meet its commercial needs, every company obtains materials or services. Procurement is the process of purchasing items and services from suppliers or dealers. Procurement should be carried out in such a way that materials are ordered in the correct amount, at the correct price, and at the correct time.

  • Purpose-

The MM System's external procurement revolves on a broad cycle of operations.

  • Process Flow-

The following are the stages of a typical service or material procurement cycle:

1.Requirements Determination

Materials requirements are determined in user departments or through materials planning and management. Purchase requisitions can be manually entered or automatically produced by the materials planning and control system.

2.Identifying the Source

Based on previous orders and existing longer-term purchase agreements, the Purchasing component assists you in identifying possible sources of supply. This shortens the time it takes to create quote requests (RFQs), which may then be forwarded to suppliers electronically via SAP EDI if desired.

3.Selection of Vendors and Quotation Comparison

The technology is capable of simulating price scenarios and allows you to compare many quotes. Letters of rejection can be sent out automatically.

4.Processing of Purchase Orders

To assist you in creating a purchase order, the purchasing system uses information from the request and the quotation. You may produce Pos manually or have the system do it for you, much like buy requisitions. Vendor scheduling agreements and contracts (forms of longer-term purchasing agreements in the SAP System) are also supported.

5.Follow-up on Purchase Orders

The system monitors the reminder intervals you've set and, if required, produces reminders or expediters at the intervals you've set. It also keeps track of the progress of all purchasing requisitions, quotes, and purchase orders for you.

6.Receiving of goods and inventory management

Goods receiving workers may simply input the PO number to confirm the receipt of goods. Buyers can limit over- and under delivery of ordered items by defining allowed tolerances.

7.Verification of Invoices

The technology allows you to examine and match invoices. Because the system has access to PO and goods receipt data, the accounts payable clerk is alerted of quantity and price variations. This shortens the time it takes to audit and clear invoices for payment.


To complete its business needs, any company obtains materials or services. Procurement is the process of acquiring commodities and services from suppliers or dealers. The procurement technique must be carried out in such a way that it is ordered in the correct quantity, at the correct price, and at the correct time. You can enroll yourself in the SAP MM Training in Noida to learn everything there is to know about the SAP MM module.