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Hi,

I am continuing my  previous document (Different freight scenarios and copy freight condition from delivery to billing document.) in which I had shared some freight scenarios and explained the most simplest one. In this document I’ll be explaining the scenarios which are similar to each other and settings are also same except some specific points which I’ll explain. This document is related to SD/MM/LE so it is not possible for me to post it in different spaces. Users from Sales and DistributionLogistics Execution and Materials Management can also take advantage of this document.

Scenario 2

Freight is being paid to vendor and you have transportation module implemented. You calculate freight automatically and post it to FI. Company pays this freight and bears the expense.

I am not going into detailed configuration steps of transportation management because that is available in many links. I also assume that you have basic knowledge of Sales order processing, transportation management and purchase order process. We will post freight charges through a freight service PO and I will explain determination of this PO.

From Sales order point of view document flow would be like this.

Activity Transaction Code
Create sale order VA01
Create delivery order VL01N/VL10A
Create Shipment Document VT01N
Create shipment cost document VI01
Post vendor payment invoice MIRO

In this process you can create billing document with VF01 anytime after creating delivery order. You can change the settings for billing document as per your requirement.

From STO point of view you will create STO with ME21N and create delivery with VL10B. Rest of the process would be same.

Lets take an example and view this process in screens.

I have created a sale order, delivery and shipment document. Now creating shipment cost document. Settings for shipment type, shipment cost document type and item category type has also been shown here.

Shipment Type

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Shipment cost item category type

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Important Note:    In this above screen you can see that I am not generating PO automatically here. We can use it with both ways. Generte PO automatically or determine it using some specific fields which I’ll explain later. You can maintain here A B or C and if you dont want to create PO automatically leave this field blank.

Shipment Cost document type and assignment of item category.

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Now I am creating shipment cost document w.r.t shipment document.

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You can see that net value is calculated based on condition record maintained for departure zone, destination zone, vendor and country etc. There is transfer button which means if you mark this and save document system will post this freight charges to FI. There can be two possibilities here.

Create PO Automatically

As I have mentioned above that we can create PO automatically for one day one week or one month. This automatically created PO will have service entry sheet as well based on your configuration for account assignment category of PO. There will be no release strategy for this automatically created PO. At end of the period you can post one single invoice for vendor for all shipment documents.

Determine PO

If you want to use some release strategy for freight service PO then you don’t need to create PO automatically. You can create PO manually with ME21N. There are some specific fields which must have similar/specific values in freight service PO and shipment cost document. These fields are as follows.

Purchase Order Header

Company code

Purchasing organization

Purchasing group

Document currency

Vendor

Invoicing party

Validity start/end

Purchase Order Item

Plant

Purchase order item category

Account assignment category

Delivery date

Final invoice indicator

Block indicator

Value limit

For more information on these fields you can view SAP document which you will get in Message no. VY033 when you mark transfer button and press enter system will give you this following message.

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Once you create a valid freight service PO system wont give you this message and will post freight charges in that freight service PO. Let me show you in below screen.

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I created this PO with identical fields in shipment cost document. Then I marked the transfer field in VI02 and saved. System posted this in this freight service PO with following accounting entry.

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After this what you have to do is just post vendor payment through MIRO. System will credit the vendor and debit the GR/IR account. Following would be accounting entry and purchase order history view.

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Scenario 2 is completed here. Though this is very lengthy process and there can be a lot of screens but as I said earlier I have just shared important screens and assuming that you know rest of the process. If you still have any confusion related to this scenario, you can ask me.

Scenario 3

Freight is being paid to vendor and you have transportation module implemented. You calculate freight automatically and post it to FI. Comapny doens’t pay this freight but charges to customers.

This scenario is same as scenario 2 but with one additional settings which is to copy freight from shipment cost document to SD billing document in VF01. For this we have certain controls in copy control of billing document, pricing procedure of shipment cost document and pricing procedure of billing document.

All the settings would be same as in scenario 2 except following which I am explaining in detail. We can also say that following are the prerequisites for copying freight from shipment cost document to billing document.

Condition type for Customer Freight

In shipment cost document you calculate freight automatically. Now it is upto you that whether you want to bill the same amount to customer which you have paid to vendor or you want to add some margin in it. If you want to bill the same then you don’t need to create any separate condition in shipment document pricing procedure. If you want to add some margin then you need to create new condition and add margin using automatic calculation or you may also enter this condition manually. In case of separate condition you need to mark it as static so that it doesn’t influence the freight charges which we have to transfer to FI using freight service PO. In my case I am taking 100% of freight charges which we are paying to vendor. This is just a test case and there is no rule for taking 100%.

Condition type for customer freight in Transportation IMG node

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Add this condition type in shipment cost document pricing procedure

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Condition Type for Billing Document

You must create condition type with same name as it is in shipment cost document pricing procedure. Add this condition type in billing document pricing procedure and assign account key. You also need to mark this condition as manual so that it can copy freight value from shipment cost document.

Condition type

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Add this condition type in billing pricing procedure. Here you also need to mark Transaction-specific pricing procedure in V/08 for billing document pricing procedure. This will make sure that static tick mark for this condition is redetermined. Check the F1 help of this field for further details.

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After this you need to make sure two more aspects. Number one is that you have maintained F in copy control from delivery to billing document in VTFL. Check for the item category you are using.

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In shipment document status for Overall status of calculation of shipment costs for shipment VTTK-FBGST must be Completed. In my case I am using stage level shipment so header level is not relevant for calculation but stage level is calculated so the status is complete.

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If all these settings have been made in your system then you can add customer freight condition in shipment cost document. If you are using same conditinon for customer and transporter/vendor freight then you just need to check that whether it is calculated or not. In my case I have made ZMZM condition in shipment cost document and in billing document.

Shipment cost document condition tab and its payment to transporter/vendor.

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Billing Document of customer and its accounting document.

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In this document you can see that sales value is 105.04 and freight which we are charging to customer is 100. Both revenues are posted in separate general leedgers and customer has been debited with 204.60. This is my test case and you can make settings as per your own requirement.

Scenario 4

Company has it’s own transportation vehicles and it doesn’t pay freight to any vendor but calculates and charges this separately to customer.

In this case settings are same as in scenario 3. You only need to do is one thing is that don’t create a service PO and don’t trasnfer it to FI. All other settings would be same.

Scenario 5

Company pays freight to vendor and charge this freight to material price in plant to plant transfer under same company code. This freight is calculated in shipment cost document automatically.

This scenario only works for the materials which have pricing price control V Moving average price in material master data. For price control S you have to implement material ledger and freight cost would be charged to material price when you run closing cycyle in material ledger. For further information yo can view a thread I raised for this in my this link.

For configuring this scenario you need to take care of following things.

Activate pricing for STO and add freight value condition with no value in STO. For this you can follow the below path.

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In condition type of STO pricing procedure which you will enter with no value, activate the copy shipment cost by checking this below field.

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Condition FRB1 with no value in PO

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When you create STO > Outbound Delivery you must not PGI it before you create shipment cost document. If you PGI it before shipment cost document, system won’t charge the price to material. Create STO > Outbount delivery > Shipment Document > Shipment Cost Document and after that PGI. In this shipment cost document you won’t see the transfer action box which we use to transfer cost in FI. Reason behind this is that cost would be charged to material and GR/IR account will also be posted with credit value when you do PGI.

Shipment Cost Document without transfer action box.

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Accounting Document when you PGI. You can see the debit and credit entries difference and also GR/IR credit entry.

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Below is the accounting document which is created at the time of MIRO when you pay the freight value to transporter.

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These are few scenarios which comes in my mind. There could be many others but if you know all of these I think you can configure the system the way you want. With little tweakings all other scenarios could be covered.

If I have missed something or you have something to add in this document please write me in comments. I would be happy to see positive/negative feedbacks because I always learn from it.

I have spent enough time to learn and test all these scenarios on my own but I would like to thank Jürgen L and Lakshmipathi G because I got guidance from these two SAP Masters.

Thank$

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44 Comments

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  1. G Lakshmipathi

    Comprehensive blog and keep it up ‘ MoazzaM ‘.   Just to add my observations, you have explained various process only related to Individual Shipment and Direct Leg.  But as you are aware there are also other scenarios with different Process Control and different Leg indicators.  May be you can add these scenarios also in your next blog as I have seen lot of threads discussing lot of issues related to these two fields and it will be very helpful to those who are in similar project

    G. Lakshmipathi

    (1) 
    1. ' MoazzaM ' Post author

      Thank you sir for appreciating this little effort and giving me new idea to work on. I’ll try my best to test multiple shipment documents scenario and multiple legs as well. This document was to cover only freight scenarios. Shipment chains and multiple legs are something that I need to learn first. Thanks again for guiding me and for being kind.

      Thank$

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      1. G Lakshmipathi

        This document was to cover only freight scenarios

        Freight is applicable to even for rest of the scenarios which I have highlighted 😉

        G. Lakshmipathi

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        1. ' MoazzaM ' Post author

          😀

          Let me rephrase it sir. This document was for simple freight scenarios and the idea you gave me is for complex freight scenarios 😉 and I will start exploring that now 🙂

          Thank$

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  2. Joao Sousa

    Hello. Very nice blog.

    It would like to add that there is a variation of the Scenario 4. Even if the transport is made by an internal carrier, you may have to make CO posting between cost centers. For example if you want to have a controlling model where the fleet cost center charges commercial cost center for the transport, you need to post FI/CO documents.

    Another variant is if you want to make posting directly to CO-PA since it’s a critical factor in your gross margin. Instead of posting to CC you post to CO-PA.

    This complicates things, and it’s a bit FI/CO centric, but I’ve seen that model used in several companies (and I have implemented it).

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    1. ' MoazzaM ' Post author

      Hi Jaoa Sousa

      I was also thinking about it but since I am not expert in FICO so I couldn’t sort it out and left this area for CO guy. If you can share a little more I’ll test it and add in this document the missing area of scenario 4.

      Thank$

      (0) 
      1. Joao Sousa

        Hi,

        I did say it was a bit CO centric, and I didn’t mean to say the full explanation should be included in this blog, since this is already for 3 spaces. It was more of a “You may have to do this, call your CO guy if you do”.

        In a way it is similar to the external vendor, but you use secondary cost classes (since you are not handling “real” costs), and don’t use clearance accounts (since you don’t have a vendor).

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  3. Suhaib Bin Aziz

    Dear Moazzam,

    Very Comprehensive and Informative Blog! Well explained and let me tell you that you have a very good sense of explanation! 🙂

    Regards,

    Suhaib Bin Aziz

    (0) 
      1. ' MoazzaM ' Post author

        Hi

        Thank you Mehmet Ozgur Unal. These are value addition links for this document. Though I’ve gone through this note and document but didn’t share the links beause this document is for inbound deliveries and I was testing for outbounds.Though logic and functionality is almost similar but still thanks for remebring this 🙂

        Thank$

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  4. Kunalesh Roy Choudhury

    Hi MoazzaM

    I must say…its one of the best and simple to understand document I have seen on freight.

    The document is very much comprehensive and depict scenarios nicely.

    I appreciate your effort & thank you for sharing.

    Warm Regards

    Kunalesh

    (0) 
  5. Lee Rivera

    Upon transfer of the Shipment Cost Document, I configured my system to create PO automatically. It then creates the entry in SES and the entry is automatically accepted.

    Is there a way for the PO to be automatically created but the service entry created wouldn’t be automatically created?

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    1. ' MoazzaM ' Post author

      Yes there is a way which I have discussed in my thread which I guess I have shared in this blog as well. You have to take care of field Goods Receipt, Non-Valuated in account assignment category settings.

      Thank$

      (0) 
      1. Shiva Vasireddy

        Hi Moazzam,

        This is a very Good Blog

        we do have requirement like two deliveries are created in two different company codes and one shipment document created with two deliveries and shipment cost created

        The requirement is to split the shipment cost to respective company codes as per the deliveries

        pleaase suggest

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  6. Antonio Carrere Garcia

    Hello MoazzM,

    Great explanations! However, I am missing a scenario that I am facing right now. It is a bit similar to what you explained about the STO but it does not create the PO for the transport, meaning that when processing the shipment document, the system will create a GR for the goods and with planned delivery cost in it. The flow would be the following:

    The STO creates an Outbound Delivery, then I create the shipment document, then I create the shipment cost document, then I go again to the shipment document and i finish it, the system posts the goods issue of that outbound delivery and a goods receipt, both in the same STO. The post of the Goods Receipt should come with planned delivery costs related to the shipment cost document.

    I have seen a similar stuff when buying from an external vendor by managing Inbound Deliveries, but I have not been able to customize the system for the scenario described with Outbound Delivery and STO.

    Any help from you or from any other SAP guru is welcome.

    Cheers,

    Antonio

    (0) 
    1. ' MoazzaM ' Post author

      Hi Antonio

      Can you please explain this with some example and accounting entries? For such requirements I can understand better with some example and your current and required accounting entries.

      Since this is a new requirement so it would be better if you open a new thread by referencing this document.

      Thank$

      (0) 
    1. Ganapathi Raman P

      Hi MoazzaM,

      That’s very nice explanation. I have one problem,

      1. How you process multiple vendors with one shipment cost document,

      Is possible with multiple item category in shipment cost document. Please explain with configuration part also,

      Rgds,

      Ganapathi Raman P

      (0) 
      1. ' MoazzaM ' Post author

        Hi

        Yes this is possible with multiple shipment cost item categories. Rest you have to explore. I can’t explain step by step here.

        Thank$

        (0) 
  7. Pankaj Khatoniar

    Hi MoazzaM


    I read your blog with great attention and I must say it has really helped me in understanding the various freight processes. I am new to LE and therefore, indebted to this great piece of information.


    As I write this, I am involved in creating a blueprint for a client. I have a few doubts my friend and I hope you will answer them. I don’t need detailed explanation but a brief idea will be fine.


    So here comes my questions:


    1. In scenario 3, for the Access Sequence ZMIM, what fields have you used?


    2. If I want to bill the same amount to the customer, shall I use the Standard Condition type FB00 and create one similar to that in SD Pricing and assign it to my SD Pricing Procedure?


    3. With reference to Q2 above, should the condition type in question be assigned to my standard pricing procedure, say RVAA01 or a new one has to be created?


    4. Last but not the least, the accounting key that you assigned, is that ERL or a different one to be assigned in consultation with FI Guys?


    I look forward to hearing from you.


    Regards

    Pankaj

    (0) 
    1. ' MoazzaM ' Post author

      Hi Pankaj Khatoniar

      I am sorry brother for replying you after so long. I hope you doubts would have been cleared now as you must have been testing this in your system. For you question let me try to answer.

      1. I don’t remember and don’t have access to that system where I tested this. You can use any fields you want. Access sequence is not any issue.
      2. You are right. It is better to create your Z conditions with same name.
      3. You have to assign this condition to your pricing procedure which you are using for billing document. If this is RVAA01 then yes.
      4. Which account key? I think it is ZRL in my screen shot but honestly I didn’t ask any FI consultant. This was my own testing and I created my own account key and GL for testing 😉

      Thank$

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  8. Ratana Pouy

    Hi MaozzaM,

    Could you explain the process of Scenario 3? Once you Billing is posted, shipment cost automatically created or do you have any step to create shipment cost?

    I tried as same as your step, but i don’t know how to create shipment cost and billing is done.

    Thanks,

    Ratana

    (0) 
  9. Vamsee Mopuru

    Hello MaozzaM, That’s some nice work you put in which requires a lot of effort to create the scenarios and most importantly sharing your findings. Not many share….

    Also have you come across integrating with FEDEX/UPS for tracking/freight directly and not via 3rd party tools like processweaver etc.

    Regards,

    [V]

     

    (0) 
  10. Tasnee Functional Consultant

    Dear Moazzam,

    Thanks for your significant document i really appreciate your efforts.

    I would like to ask 1 more point in existing scenarios you covered.

    Shipment Cost document flow to COPA -value fields…
    In our case Freight cost flowing from Shipment cost doc- and COPA also to be flowed from here.
    I found the Note: 733981 – Info: Update shipment costs into CO-PA.
    Its an humble request if you have an brief idea on this you have proceed in our projects, really appreciate you.

    Regards,
    Mansoor Khan

    (0) 
  11. ' MoazzaM ' Post author

    Hi

     

    I didn’t check this neither I had this requirement. Did you check and tested this in your testing client? Try to configure this and update what is your findings.

     

    Thank$

    (0) 
  12. Juan Carlos Consiglieri D'Angelo

    Hi MoazzaM,

    great document.

    Regarding the last Scenario 5: Transfer of the shipment cost to the material as delivery cost, could you please confirm if when posting the freight invoice via MIRO the option “Transportion Service Agent” is available for a selection i.e. by Shipment document.

    I know that in the case of tranport documents with setllement to GL-Accounts that is possible, but I’d like to know if in the case of Scenario 5 it works as well.

    Looking forward to hearing from you

    BR

    (0) 
    1. ' MoazzaM ' Post author

      Hi there

       

      Thank you for your concern. I am not sure about your requirement as this was tested by me years ago. Now I am in new company with new system and all that. I’ll have to build all the scenario from scratch for testing this. I’d suggest that you test this by yourself in your test system.

       

      Thank$

      (0) 
  13. Santosh Panda

    Hi Moazzam,

     

    Great Document.

    But In my client there are both the scenarios where :

    1. Shipment cost calculated and the same charges to the customer
    2. Shipment cost not calculated

    So As you described scenario 3 I made all the configuration and it is working fine but when shipment cost not calculated system doesn’t allow to bill the invoice.

    Can you please guide how to solve this issue.

    The error is showing shipment cost determination not completed while billing.

    (0) 
  14. ' MoazzaM ' Post author

    Hi Santosh

     

    When there is no shipment cost calculation then how could system allow to bill it? Why would you even need to create shipment cost document when you don’t need to calculate the cost. Only shipment document is enough for this scenario.

     

    Thank$

    (0) 

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