MM configuration process:-
1. Enterprise Structure Configuration
Enterprise structure defines how an organization is represented in SAP.
1.1 Define Company:-
SPRO Path:
Enterprise Structure → Definition → Financial Accounting → Define Company
Enter Company ID, Name, Address, Currency, Language.
This is the top-level organizational unit.
1.2 Define Company Code:-
SPRO Path:
Enterprise Structure → Definition → Financial Accounting → Define, Copy, Edit
Company Code
Company code represents an independent legal entity.
Assign country, currency, language, chart of accounts.
1.3 Define Plant:-
SPRO Path:
Enterprise Structure → Definition → Logistics - General → Define, Copy, Delete,
Check Plant
A plant is where production/procurement/storage happens.
Plant is central to MM, SD, and PP modules.
1.4 Define Storage Location:-
SPRO Path:
Enterprise Structure → Definition → Materials Management → Maintain Storage
Location
Storage location is where stock is physically stored within a plant.
Assign to a plant.
1.5 Define Purchasing Organization
SPRO Path:
Enterprise Structure → Definition → Materials Management → Maintain Purchasing
Organization
Handles procurement activities for one or more plants.
1.6 Define Purchasing Group:-
SPRO Path:
Enterprise Structure → Definition → Materials Management → Maintain Purchasing
Group
A person or group responsible for procurement activities.
1.7 Assignment Steps:-
Assign Plant to Company Code
Enterprise Structure → Assignment → Logistics - General → Assign Plant to Company
Code
Assign Purchasing Org to Company Code
Assignment → Materials Management → Assign Purchasing Org to Company Code
Assign Purchasing Org to Plant
Assignment → Materials Management → Assign Purchasing Org to Plant
Assign Purchasing Group to Purchasing Org (Optional)
2. Material Master Configuration:-
SPRO Path:
Logistics - General → Material Master → Basic Settings
Key Activities:
Define Material Types (ROH, HALB, FERT, HAWA)
Define Industry Sectors
Configure Number Ranges
Define Field Selection Groups
Define Field References and Field Selection for each material type
👉 Purpose:
Controls what views and fields are available when creating materials.
3. Vendor Master Configuration
SPRO Path:
Logistics - General → Business Partner → Vendors → Control → Define Account Groups
Key Activities:
Define Vendor Account Groups
Assign Number Ranges
Set Field Status for each account group
👉 Purpose:
Account groups control the fields (mandatory/optional) and number assignment during
vendor creation.
4. Purchasing Configuration
SPRO Path:
Materials Management → Purchasing
Key Settings:
Define Document Types (PR, PO, Contract, RFQ)
Set Number Ranges
Set Allowed Item Categories
Assign Screen Layouts
Define Release Procedures
For PR, PO, Contract
Set Release Strategy based on criteria (e.g., value)
Maintain Purchase Order Default Values
Maintain Conditions and Pricing Procedures
Materials Management → Purchasing → Conditions → Define Price Determination Process
👉 Purpose:
Customizes how purchasing documents behave, how they’re numbered, and how approvals
and prices are handled.
5. Inventory Management Configuration
SPRO Path:
Materials Management → Inventory Management and Physical Inventory
Key Activities:
Define Movement Types (e.g., 101 = GR, 201 = GI to cost center)
Configure Reason Codes for Movements
Define Automatic Account Posting
Define Tolerance Limits
Define Goods Receipt Settings
Configure Physical Inventory Procedures
👉 Purpose:
Controls how goods are moved in SAP and how they impact stock and finance.
6. Valuation and Account Assignment
SPRO Path:
Materials Management → Valuation and Account Assignment
Key Activities:
Define Valuation Areas (Plant/Company Code level)
Assign Valuation Classes to Material Types
Configure Account Category Reference
Define Automatic Account Determination (T-code: OBYC)
Set G/L Account Assignments based on:
Valuation Class
Movement Type
Account Grouping
👉 Purpose:
Ensures correct financial entries are made automatically for MM transactions.
7. Invoice Verification Configuration
SPRO Path:
Materials Management → Logistics Invoice Verification
Key Activities:
Define Tolerance Limits (Price/Quantity Variance)
Define Blocked Invoice Reasons
Maintain Number Ranges for Invoice Documents
👉 Purpose:
Manages how supplier invoices are checked against POs and GRs.
8. Output Determination (Optional)
SPRO Path:
Materials Management → Purchasing → Messages
Key Activities:
Define Output Types (NEU for PO)
Assign Forms (SAPscript, SmartForm, Adobe Form)
Set Access Sequences
Configure Output Condition Records
👉 Purpose:
Used to send POs to vendors via print/email/fax.
