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Scrapping / Write Off in SAP - Inventory Management - SAP Implementatino

Scrapping / Write Off In the standard SAP definition, postings for Scrapping/ Write-off in inventory management are made, if a mater... thumbnail 1 summary

Scrapping / Write Off


In the standard SAP definition, postings for Scrapping/ Write-off in inventory management are made, if a material can no longer be used.  Scrapping / write-off may be due to when:

·         The quality has been reduced due to prolong storage.

·         Inventory has become out of date

·         The material was damaged

·         Product discontinuation

·         Change in specification


At MyCompany, the SAP scrapping or write-off function is used to write-off loss in transit and for obsolete or scrapped stocks.



Scenarios
Remarks

Write-off rejected, obsolete or damaged stock
Periodic clearing of ‘old’ or damaged stocks from the stores
Write-off transit loss

This is applicable for the materials that are lost in transit

 

SAP Recommended Process: Scrapping / Write Off

Upon identification of the rejected, obsolete stocks, they are transferred to the Rejected Warehouse through transfer posting within the plant.

A standard listing of the to-be-scrapped materials at the Rejected Warehouse, will be printed for stock to be written off. Approval on the listing is obtained from the concerned authorities.

Once the approval is obtained, the scrapping process will be carried in the system using relevant movement type, at the Rejected Area. A service order will be created if the scrapping services are to be obtained from a vendor, against which the service charges will be recorded.

Note: When goods are scrapped they are not reflected in the system as part of the inventory. The scrapped material will be physically moved from the Rejected Area to the Vendor Scrap Area (not defined in the system). QC can destroy the scrap material when needed.

1 comment

3PL Warehousing said...

Definitely, supply chain mangagement is difficult task to perform and keep the records updates with all products , especially when you are running a big 3PL warehousing .I agree with your points, you have mentioned.