From a supply chain perspective, there are notable similarities between cross-company and intra-company stock transfer processes.
In both cases, the transfer of stock from one plant to another is monitored using a purchase order document.
Shipping data is automatically determined and stored in the purchase order item. This data enables the creation of an outbound delivery in the delivering plant.
Additionally, purchase requisition items can be used in both scenarios. These requisitions may be created manually or automatically through an MRP (Material Requirements Planning) run. Both purchase requisitions and purchase orders are visible and relevant for planning and scheduling in both the supplying and receiving plants, supporting coordinated logistics and inventory management.
The main difference between an intercompany and an intracompany stock transfer process is the involvement of billing. In an intercompany transfer, the supplying and receiving plants belong to different company codes, which requires the creation of an intercompany invoice. This billing step reflects the financial transaction between the two legal entities and is not present in intracompany transfers, where both plants belong to the same company code.
For stock transfers between company codes, two scenarios are available: the basic intercompany stock transfer and the advanced intercompany stock transfer. Our consultant, Julia, will briefly describe both options and highlight the key differences between them. Following her overview, we will demonstrate the advanced process in detail within the system.
Intercompany Stock Transfer (1P9) Scenario (Basic Option)
The figure below outlines the key steps involved in the basic intercompany stock transfer process.
You create a standard purchase order (document type Standard PO (NB)) in the receiving company. A standard purchase order requires specifying a supplier.
To enable the system to recognize the order as an intercompany purchase order, a business partner master record (supplier) must exist for the supplying plant in the supplying company. This setup ensures that the system correctly interprets the relationship between the two entities.
The supplier specified in this purchase order represents a plant belonging to the supplying company code.
To trigger the necessary shipping activities, the delivering company creates an outbound delivery - also known as a replenishment delivery.
The goods issue is posted in the supplying company with reference to the outbound delivery, initiating the transfer of stock and updating inventory records accordingly.
For intercompany billing, an intercompany customer invoice is created in the supplying company for the goods delivered to the receiving company.
Upon arrival of the goods at the receiving plant, the goods receipt is posted with reference to the intercompany purchase order.
Note
The goods issue in the supplying company results in the transfer of material quantity from the unrestricted-use physical stock of the supplying plant to the cross-company code stock in transit of the receiving plant.
Subsequently, the goods receipt in the receiving company leads to a stock transfer from the cross-company stock in transit to the physical stock of the receiving plant.
- The intercompany invoice is posted as an incoming invoice (supplier invoice) in the receiving company, completing the financial side of the intercompany stock transfer process.
Advanced Intercompany Stock Transfer (5HP) Scenario
The figure below outlines the key steps involved in the advanced intercompany stock transfer process.
The process begins with the creation of an intercompany purchase order by the purchasing organization in the receiving company code.
The supplier specified in this purchase order represents a plant belonging to the supplying company code.
In the background, the system automatically generates an intercompany sales order in the supplying company, ensuring seamless integration between the two entities.
When the intercompany purchase order is due for shipment, an outbound delivery is created in the delivering company—either manually by a shipping clerk or automatically via a background job.
This outbound delivery controls the physical flow of goods from the supplying plant.
The goods issue is then posted in the supplying plant, based on the outbound delivery.
As a result, the material quantity is transferred from the unrestricted-use physical stock to the stock in transit of the supplying plant, documenting that the goods have physically left the plant.
An inbound delivery is automatically created in the background in the receiving company. It is used to control the physical receipt of goods into the receiving plant.
Based on a transfer of ownership date included in the outbound delivery, a background job automatically posts the transfer of ownership, ensuring accurate and timely financial posting.
As a result of the posting, the material is transferred from stock in transit at the supplying plant to stock in transit at the receiving plant.
Once the materials have arrived, the goods receipt is posted in the receiving plant with reference to the inbound delivery.
With the posting of the goods receipt, the material is transferred from stock in transit to the physical stock of the receiving plant.
The intercompany customer invoice can be created after the goods issue (step 3) or at a later point. Creating the intercompany customer invoice automatically triggers the creation of an intercompany supplier invoice in the receiving company.
The benefits of the advanced process compared to the basic one are as follows:
Automated Intercompany Sales Order Creation
The system automatically generates an intercompany sales order in the supplying company in the background.
Automated Inbound Delivery Creation
An inbound delivery is created in the receiving plant of the receiving company without manual intervention.
Valuated Stock in Transit
Both the delivering and receiving plants maintain valuated stock in transit, improving inventory visibility and financial accuracy.
Control Transfer Posting
A control transfer of goods is posted, ensuring accurate tracking and compliance.
End-to-End Process Monitoring
All process steps can be tracked using the Monitor Value Chains app, providing transparency and control.