Transit warehousing with embedded TM and EWM in SAP S/4HANA 1709 release

This blog highlights the ‘Transit warehousing’ scenario with embedded TM and EWM in S/4HANA 1709 release.

There is a requirement in one of my greenfield S/4HANA projects that the individual departments will raise the Purchase order directly to the vendor and the box (containing the ordered material) from the vendor is received through the Central warehouse as depicted in the below image. Central warehouse just registers the box (not the content of the box) at the Goods receipt zone and passes it directly to the Goods issue zone in the trolley for the individual department i.e there is neither any placement of box to the regular bins in the warehouse nor any update of the inventory on goods receipt.

I was looking for the standard SAP solution options for this requirement. ‘Merchandise cross docking’ was not a feasible option as it needs ‘Retail’ set up (Business functions) as of S/4HANA 1709. Then explored the ‘Transit warehousing’ solution which seems to be the best fit for the requirement.

Prototyped the ‘Transit warehousing’ in S/4HANA 1709 with embedded TM and EWM. Process flow is depicted in below image. Note that the process starts with a ‘Forwarding order’ which is mostly relevant for LSPs’ (Logistic service provider).

TM in S/4HANA 1709 is considered to be a ‘Shipper’ release i.e not for LSP scenarios, however ‘Transit warehousing’ scenario is very much possible with S/4HANA 1709 release. Settlements of Forwarding orders do not work well with 1709 release which is now expected to be possible with 1809 release.

As per the standard SAP process for ‘Transit Warehousing’, a Forwarding order is created for the transport of Box from Source (Vendor) to the destination (Department) with the Central warehouse as the ‘Transit warehouse’. Two Freight orders are created in TM (embedded)

1. Inbound for transport from Vendor to Central warehouse
2. Outbound for transport Central warehouse to the department

Subsequently, two Freight orders are created in EWM (embedded)

1. Inbound from ‘Unloading instruction’ from TM Inbound freight order
2. Outbound from ‘Loading instruction’ from TM outbound freight order

Document flow of the Forwarding order shows the Freight orders in embedded TM and EWM as in below image.

EWM Inbound freight order shows the relevant TU and HU as below. TU is docked at door after Arrival at Checkpoint.

HU is unloaded at Goods receipt zone and subsequently placed (Putaway) directly at Goods issue zone as shown in below image. Putaway to the Goods issue zone can be done through RFUI.

A new TU is created with the same HU in EWM Outbound freight order as shown in below image for the transfer of HU from Goods issue zone to the department.

Functionality of ‘Transit warehousing’ was released in EWM 9.3 & TM 9.3 and this functionality can also work in S/4HANA 1709 with the Direct integration between embedded TM and EWM as explained in my blog https://blogs.sap.com/2018/03/14/direct-integration-between-embedded-ewm-tm-in-s4hana-improving-overall-efficiency-of-suply-chain/

Also note that as per SAP documentation , this ‘Transit warehousing’ needs ‘Advanced ‘ EWM license along with ‘Advanced’ TM license with S/4HANA 1709 release.

This ‘Transit warehousing’ is very useful for LSPs’ as well as for Shippers . It helps to reduce warehouse cost , delivery / lead time and improve the overall efficiency of Supply chain.