An outline agreement is a longer-term arrangement with a supplier for the supply of materials or provision of services based on predefined terms and conditions. This arrangement is valid for a certain period and for a predetermined total purchase quantity or value. You can distinguish between two types of outline purchase agreement:
Contract
Scheduling agreement
In the next section, we take a closer look at the contract.
The structure of a contract (or of an outline agreement in general) corresponds to that of other purchasing documents. A distinction is made between the document header and the document items.
The document header contains information relating to the entire agreement (such as vendor data, agreement validity period, agreement type, and header conditions).
A document item contains specific data to the goods or services to be procured (such as material, agreed total purchase quantity, price, and texts). However, there is no specification of the quantity to be delivered on a specific delivery date.
Contract items can relate to an individual plant or to all the plants of a purchasing organization. A contract without plant information on the item level is called an (ERP) central contract.
You can create a contract item manually without referencing another document, or by referencing a quotation or purchase requisition item. You can also reference an existing contract.
Contract Types
To inform the vendor which quantities you need on which dates, you enter purchase orders referencing the contract. Such POs are known as contract release orders or contract releases. These contract release orders are recorded in the release documentation for the relevant contract item.
You can enter a contract item as a source of supply in a purchase requisition item. This ensures that the outline agreement is referenced when the purchase requisition item is converted into a purchase order item. The resulting PO is a contract release order.
Contract Release Documentation
The release documentation belongs to the statistical data on a contract item. To display the release documentation, select the desired contract item and choose Item → Statistics → Release Documentation.