Assignment of incoterm locations in SAP TM
Dear friends of SAP TM,
Incoterms and incoterm locations play an important role during transportation planning. In an integration scenario with SAP TM and SD, MM or LE, the incoterms and incoterm locations are defined i.e. in the sales order or purchase order. In SAP TM, those might then be considered during freight unit building by adding an additional stop at the requested location, if required.
But there’s one issue…the locations used in SAP TM are not known in SD, MM and LE. So, in the sales order/purchase order/.. you can only maintain your incoterm locations as free text and afterwards some mapping to a ‘TM-location’ needs to be in place.
With the following example, we will take a look at this in detail.
At first, we maintain the relation between the ‘free text location’ and the ‘TM-location’ (transaction /SCMTMS/INCLOC_MAP):
Hereby, the location ZMHA_HUB has been created upfront in the location master:
Now, let’s create a regular sales order:
Here, incoterm EXW is maintained with the incoterm location ‘My Hub’. In other words…the goods to be transported are to be picked up at location ‘My Hub’.
Usually, this information is maintained at the business partner and then automatically taken over:
When we now integrate this sales order with SAP TM, the following freight unit is created:
You see, the incoterm and incoterm location have been taken over to the freight unit as maintained in the sales order
But furthermore, one additional stage has been created with a stop at the incoterm location:
For our example, this makes perfect sense, because the goods to be transported have at first to be carried from the shipping point ‘SP_TM84.’ to the hub ‘ZMHA_HUB’. And from there, it can be picked up and transported to the customer ‘TM84_BP_DUE’, just as the incoterm EXW implies.
It’s important to mention, that the consideration of incoterm locations in freight unit stage building is dependent on some settings in customizing. So, dependent on those settings, the stage building for this example might well look different. This is surely worth another blog post.
Finally, here are some additional remarks:
- As the incoterm location in SD, MM and LE is free text, be careful to maintain it correctly when assigning the location, i.e. regarding spaces etc.
- For some incoterms, no additional stage is necessary. So when you miss a stop in the freight unit, check at first, if it’s really required. And of course the mentioned settings in customizing are important.
I hope you enjoyed reading this. Please feel free to comment!
Thanks for the blog entry. We were wondering if it would be possible in upcoming versions to add in the SD, MM, LE Incoterm location entry a matchcode linked to the Incoterm Locations (the TM locations) maintained the transaction /SCMTMS/INCLOC_MAP. We find that the free text sometimes is not populated with the correct text, hence the integration fails.
Thanks for your comment!
Your point is very relevant and we know that this is certainly a point with potential for optimization, making the integration with TM a bit more smoothly. But I kindly ask for your understanding that I can't comment on functionality in any future release not being published yet, no matter if there are such plans for optimization or if there aren't.
I understand your point and thank you for your prompt reply.
could we add a capacity constraint to the SD location? for example the restrain of 10 ton of a bulk material could be stored in it for FOB and 12 ton for CIF?
also how will you direct the truck to pick up either from location A or location B inside the yard from the gate in such case?
tbis should be somehow mentioned in sales order since delivery will be created after freight order - am I correct ?
For the capacity constraint, I would rather go for making two items out of them.
And for the picking up of the truck, there are various possibilities i.e. depending whether an EWM is used.
But I'm not the expert for those topics and this surely needs to be analyzed deeper.
You have mentioned two items - do you mean 2 product codes?
We are in continious manufacturing, i.e. Cement, so thsi is the same product code in 2 silos (interexchangeable )
WM will be may be overkill and the Yard Management too.
I assumed if there is some simple solution, e.g. Store Room, etc, which will be included in Product Allocation, and the transport trucks, etc.
What is teh integration between Bin and Freight Unit
Thanks for post,
I was checking the following question and found your post, What functionality is achieved by using a handover location from SAP ERP document in SAP TM?
A) To Override incoterm location from SAP ERP Document.
B) To split freight unit stages in an order-based transportation requirement
C)To determine planning relevance of stages in a freight Unit
D)To Split freight unit stages in a delivery-based transportation requirement.
If i got your example right, the Good options will be A and B, since the Incoterm location is the same as Handover location on Sales Order and if i change it, then the FU Incoterm location must be Override and the B due to the split of the stages.
Do you've any inputs on this question?
Thanks for your comment!
First of all to clarify...with SAP TM, are you referring to the TM embedded version in S/4? That's what my blog post focuses at.
In TM embedded in S/4, we don't consider handover locations of documents from SD/LE/MM anymore. We just consider their incoterm locations. And that, we do in the way described above.
Thank you for this blog post!
As per below comments in your blog:
"It’s important to mention, that the consideration of incoterm locations in freight unit stage building is dependent on some settings in customizing."
Do you mean, the Incoterm location stage building rule - when referring to the settings?
Thanks for your comment!
Yes, that's right, this setting with the incoterm location stage building rule is surely the main setting being relevant.
Quite frankly speaking I'm not the super expert in freight unit building so there might be some other settings becoming relevant, that's just why I left it open.
Is there any way we can maintain multiple entries (200+) at once in this screen (/SCMTMS/INCLOC_MAP)?
when we try the normal paste option in the new entries screen, it doesn't let us paste more than 19 entries.
Unfortunately I don't know any other way of maintaining a bigger amount of entries. A standard dialog is used here which has no mass upload functionality or sth. like that.