What is external procurement relationship in SAP (SCM-APO-MD - Master Data)?

SAP Term: external procurement relationship

• Component: SCM-APO-MD

• Component Name: Master Data

• Description: Master data in SAP Advanced Planning and Optimization SAP APO. An external procurement relationship represents purchasing info records, contracts, and scheduling agreements from your OLTP system for example, an ERP system in your APO system and provides all the necessary data for planning material procurement activities. It links the transportation lane with information from your OLTP system as follows: The transportation lane represents the business relationship between a source location such as a supplier and a destination location such as a plant. The external procurement relationship enhances the transportation lane information by establishing a link to a specific contract that exists in your OLTP system for the source and target locations, for example.

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• Key Concepts: 
  External procurement relationship is a term used in SAP Supply Chain Management (SCM) Advanced Planner and Optimizer (APO) Master Data. It is a type of relationship between a company and its external suppliers. This relationship is used to manage the procurement process, from the initial request for quotation to the delivery of goods and services. 
  
  How to use it: 
  External procurement relationships are created in the SAP system by entering the supplier's details, such as name, address, contact information, and payment terms. The system then stores this information and can be used to generate purchase orders, track deliveries, and manage payments. The system also allows for the tracking of supplier performance, such as on-time delivery and quality of goods or services. 
  
  Tips & Tricks: 
  When creating an external procurement relationship in SAP SCM-APO-MD Master Data, it is important to ensure that all relevant information is entered accurately. This will ensure that the system can accurately track supplier performance and generate accurate purchase orders. 
  
  Related Information: 
  External procurement relationships are just one part of the overall supply chain management process. Other components include inventory management, demand forecasting, and production planning. All of these components must be managed effectively in order to ensure a successful supply chain.