Material Management is a functional module that belongs to SAP AG that is used for Procurement Handling and Inventory Management. SAP MM is one the largest functional module in SAP. This module mainly deals with the Procurement Process, Master Data (Material & Vendor Master), Inventory Management, Valuation of Material & Account Determination, Material Requirement Planning, Invoice Verification etc.
SAP Materials management is integrated with other modules such as Sales and Distribution, Production Planning and Quality Management. Materials management is used for procurement and inventory management. The SAP MM module has two important master data – material and vendor. Broadly, the various levels that can be defined for a SAP MM implementation are: Client, Company Code, Plant, Storage Location and Purchase Organization. The SAP MM module covers all tasks within the supply chain, including consumption-based planning, planning,
vendor evaluation and invoice verification. It also includes inventory and warehouse management to manage stock until usage dictates the cycle should begin again. Electronic Kanban/Just-in-Time delivery is supported.
It can be divided into five major components. They are:
– Materials Management,
– Plant Maintenance,
– Quality Management,
– Production Planning and Control,
– Project Management System.
Each is divided into number of sub-components.
SAP MM module is a part of logistics and it helps in managing end to end procurement and logistics business process.
The main features you can find in the MM module are requisitions, purchase orders, goods receipt, accounts payable,
inventory management, BOM’s and master raw material, finished goods etc. Requisitions in SAP MM module is a document created for purchase of goods or services, it is sent to procurement office for the issuance of purchase orders. Requisitions exceeding certain amount need vendor verification in SAP MM module. There are two ways of placing requisition either through SAPGUI or SAP web. Purchase orders are the legal document issued as commitment to the vendor to supply mentioned material in the specified quantity along with shipping details and specification. The authorized vendors list is displayed while creating purchase order as per material and plant of the organization.