What is a purchasing organization in SAP MM?
A purchasing organization in SAP MM represents a physical entity, a team of persons, that is responsible to purchase some materials and services. Typically, a company has several purchasing organizations, each of them responsible of one or more specific geographical localizations, providers, or types of materials.
For example, in a multinational, one purchasing organisation is responsible of buying all metal from providers for the whole company, while an other purchasing org is responsible for procurement of perishable materials for one country, and another one for the other company locations.
In the SAP system, each purchasing organisation in the company is represented by a unique four characters identifier and a description.
An incorrect assignment of purchasing organization can lead to different SAP system errors, that can all easily be solved with some customization: Purchasing organization not responsible for plant, Vendor has not been created for purchasing organization.
See also how to Assign purchasing organization to company code to complete the list of assignments after purchasing organization creation.
- Plant specific or local purchase organization,
- Cross plant purchase organization,
- Cross company code purchase organization,
- Central purchase organization at company code level,
- Reference Purchase organization,
- Standard purchase organization.
How to create a purchasing organization in SAP?
To create purchasing organization in SAP, start by going to the customization transaction SPRO.
There, navigate to the enterprise structure management, to definition of basic entities, and then to materials management, where the maintain purchasing organization will be accessible.
Create purchasing organization in SAP: In SPRO > Enterprise structure > Definition > Materials management > Maintain purchasing organization
Then, the list of available purchasing organization will be displayed. The description can be updated, but not the purchasing organizations identifier.
Click on the new entries button to create a new one.
In the new entries screen, enter as many four characters identifiers and descriptions as necessary, for each SAP purchasing organization to create.
After that, a customization request will be necessary to save the customization changes.
The purchasing organization should now have been created, and must be available for use in the SAP system.
Assign purchasing organization to company code
One of the first assignments to perform is to Assign purchasing organization to company code after the creation of a new purchasing organization.
This very important step will then allow to extend vendor to purchasing org.
Assign purchasing organization to company code: in SPRO > Enterprise Structure > Assignment > Materials Management > Assign Purchasing Organization to Company Code
The company code and purchase org assignment table in SAP is table
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How to extend vendor to purchasing org in SAP?
To extend a vendor to purchase organization in SAP HANA, open the new business partner transaction BP.
From there, assign vendor to purchasing organization by opening the business partner in role FLVN01 supplier. After, to find how to add purchasing organization to vendor in SAP, start by opening the purchasing view available under the more menu in the top right corner.
From there, extend vendor to purchasing organization in SAP by opening the right purchasing organization.
SAP extend vendor to purchase org: transaction BP > open vendor > BP role supplier > more > purchasing > purchasing organizations
You have to extend vendor to purchase org in SAP to solve following error: vendor has not been created for purch. organization, or Vendor has not been created for purchasing organization.
The vendor master purchasing organization data table in SAP is the table LFM1 – vendor master record purchasing organization data. You can extract data from SAP to Excel from table LFM1 using the table viewer transaction SAP SE16 export to Excel function.
Vendor master purchasing organization data table in SAP: LFM1 vendor master record purchasing organization data
How to assign purchasing organization to plant?
In order to assign a purchasing organization to a plant in SAP, go to the customization transaction SPRO, and find the view “assign purchasing organization to plant”, in which you can create an entry linking purchasing organizations to plants.
Assign purchasing organization to plant: transaction SPRO > Enterprise Structure > Assignment > Materials Management > Assign purchasing organisation to plant
After that, the purchasing organization will be available for given plant, thus solving the issue “purchasing organization not responsible for plant”.
The plant and purchase org table in SAP are stored in table T024W – Valid Purchasing Organizations for Plant. You can extract data from SAP to Excel from table T024W using the table viewer transaction SAP SE16 export to Excel function.
Plant to purchase org table in SAP: T024W Valid Purchasing Organizations for Plant
Assign purchasing group to purchasing organization
There is no way to Assign purchasing group to purchasing organization as they are different entities.
There is also no common purchasing group and purchasing organization SAP table, they are totally separate: purchasing group SAP table is T024, and purchasing organization SAP table is T024E.
SAP purchase organization table
Several purchase organization table in SAP are used to store the different types of purchasing org in SAP and their corresponding assignments.
The most important purchase org table in SAP are:
- LFM1 Vendor master record purchasing organization data,
- T024E Purchasing Organizations,
- EINE Purchasing Info Record: purchasing organization Data,
- T024W Valid purchasing organizations for Plant.