What is multi-level contract in SAP IS-AFS-MM - Materials Management?

SAP Term: multi-level contract

• Component: IS-AFS-MM

• Component Name: Materials Management

• Description: A structure in purchasing with several interdependent contracts based on an AFS contract. In order to block capacities at a vendor early on, an AFS contract for diverse materials of one material group is created in an early planning phase. With reference to this AFS contract, further value and quantity contracts can be created at a later time, which contain detailed information at material level or SKU level.

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• Key Concepts: 
  A multi-level contract in SAP Materials Management (MM) is a type of purchasing agreement that allows for multiple levels of pricing and discounts. It is used to define the terms and conditions of a purchase agreement between a buyer and a vendor. The agreement can include multiple levels of discounts, such as volume discounts, early payment discounts, and other types of discounts. The agreement also defines the payment terms, delivery terms, and other conditions of the purchase. 
  
  How to use it: 
  In SAP MM, multi-level contracts are created in the Purchasing Info Record (PIR) transaction. The PIR contains all the information about the vendor, including contact information, payment terms, delivery terms, and other conditions. Once the PIR is created, it can be used to create a multi-level contract. The contract will contain all the information from the PIR as well as any additional discounts or conditions that have been negotiated between the buyer and vendor. 
  
  Tips & Tricks: 
  When creating a multi-level contract in SAP MM, it is important to ensure that all the details are correct. This includes making sure that all discounts are correctly applied and that all payment and delivery terms are accurate. It is also important to ensure that all relevant documents are attached to the contract so that they can be easily accessed when needed. 
  
  Related Information: 
  For more information on multi-level contracts in SAP MM, please refer to the official SAP documentation on Purchasing Info Records (PIRs). Additionally, there are many online resources available that provide detailed tutorials on how to create and manage multi-level contracts in SAP MM.