Applying Value-Added Services

Objectives

After completing this lesson, you will be able to:

Execute value-added services.
Execute a kit-to-order process.

Value-Added Services

Examples of value-added services (VAS) include the following tasks:

Assembling products
Packing products
Labeling products
Oiling products

You can use process-oriented storage control to execute interim steps before final putaway or before staging in the goods issue area. In these interim steps, the VAS order defines the product processing that must be performed - for example, by warehouse employees in the work centers.

A VAS order can also be used in the goods issue process to assemble kits for your customers and to pack them on a customer-specific basis.

Warehouse management workflow: goods arrive, are logged into inventory, stored, picked for orders, processed, and shipped out to customers.

Purposes of a VAS Order

The VAS order is the central SAP EWM document that controls the VAS process.

From a technical point-of-view, the VAS order is a packaging specification with a specific characteristic value.

The VAS order is the instruction to perform a value-added service on one or more products with reference to a delivery item. A VAS order links delivery items to a packing instruction and it contains details from the delivery and packaging specification. You can use a VAS order to:

Inform warehouse employees about the tasks they must perform on certain products
Track work that is performed

A value-added Service Order is created with a packaging specification for the work center.

VAS Order Details

A VAS order is created with reference to an inbound delivery or an outbound delivery order and the required packaging specification. The packaging specification uses packaging specification levels to inform the VAS order regarding VAS activities the warehouse employees need to perform in the warehouse. Information in the delivery provides the VAS order with the exact amount of work to be performed.

The VAS order contains the following:

Order header
List of VAS activities
Items
Auxiliary products

A VAS order can be created manually or automatically. Automatic VAS order generation can be configured to create the VAS order in the following situations:

When the warehouse request document is created
For an inbound process, when the goods receipt posting is made

VAS Data

The VAS data from the VAS order can be viewed or printed for employees in a VAS work center. VAS data can also be viewed in the warehouse management monitor.

You can record the auxiliary products and the quantities used for the value-added services performed at work centers. Examples of auxiliary products used in VAS processing are products such as packaging materials, strapping, shrink wrap, hangers, labels, and miscellaneous supplies.

Consumption can be recorded for all auxiliary products in the system if:

Consumption has been set for auxiliary products required for value-added services
A storage bin has been assigned in the VAS work center for the auxiliary products

Options in a Putaway or Picking Process with Value-Added Service

Depending on how you use storage control, there are different options available in the goods receipt process or the goods issue process for performing value-added services using a VAS order.

Value-Added Services with Process-Oriented Storage Control

If you are using process-oriented storage control, the system uses handling unit warehouse tasks for the movements in the warehouse. It requires that you work with HUs, but additional process steps are possible before or after the VAS activity (like unloading / loading).

A warehouse process flow for value-added services (VAS), showing goods receipt, packaging, handling units, and organized storage based on specifications.

Value-Added Service with Process Step

If you have only defined the individual process steps, and are not using process-oriented storage control, physical movements are done with products warehouse tasks. HUs are not required, but therefore of course no other process steps are possible. It is possible to have more then one work center for value added service steps, but the creation of the warehouse task has to be triggered from the work center. For this you do not complete the process step assigned the HU, but use the function Create VAS Warehouse Task.

Illustration of a goods receipt process integrating packaging specifications without process-oriented storage control.

Value-Added Service without Process

If you are not using process-oriented storage control, and you have not defined any process steps, you print out the VAS order and the warehouse employees undertake the VAS activities at the work centers manually. When the VAS activities are completed, you can enter a confirmation in the system, but this is independent of the movement with warehouse tasks.

Kits and Kitting

A kit is a list of products that are always delivered together. Examples of kits include the following entities:

Groups of materials used to repair a piece of machinery
Groups of materials used for assembly tasks
Add-on products for other products
Displays or assortments of products to sell in a retail store

SAP Extended Warehouse Management does not save kits as master data. Instead, it receives information about the structure of a kit in the form of outbound delivery items from the SAP ERP system. The structure containing the kit in the outbound delivery along with a packaging specification, is used as a basis for assembling or producing a kit in SAP EWM.

A kit can consist of the following levels:

Kit header, which represents the finished kit
Kit component, which represents a product in the kit

SAP EWM does not support "nested kits" (which are kits within kits).

"Kitting" is the process of building or assembling kits. SAP EWM supports kit-to-order and kit-to-stock processes.

In the kit-to-order process, each kit is assembled based on a customer order. This is similar to a make-to-order manufacturing process. To support sales of pre-assembled kits, SAP EWM also provides a kit-to-stock process in which kits are pre-assembled and placed into stock.

A computer system receives input for processing, illustrating data flow and interaction between components.

Kitting Process

Although SAP EWM supports the kitting processes, there is no master data such as a bill-of-material (BOM) stored in SAP EWM. The kit is represented as a hierarchy of items of an outbound delivery order. In kit-to-stock, SAP EWM can reference a BOM stored in the ERP system.

The following rules apply to kits:

A kit is always delivered in full to a customer.
The kit header and kit components are always scheduled for the same date.
All components for the kit must come from the same warehouse.
Kit prices are always calculated at the header level.
A kit header and the kit components have a quantity ratio to each other. This is defined by the kit structure.

Kit-to-Order Process Steps

The kit-to-order process, in its simplest form, consists of the following steps:

A sales order is created for the kit header in SAP CRM or in SAP ERP.
SAP EWM creates a warehouse request (outbound delivery order). This process triggers the kit-to-order process.
The kit components are picked and assembled into the finished kits.
The system confirms the delivery and the goods issue is posted for the kits.
The sales order is updated and the billing is triggered for the order.

Kit-to-order processing can be performed using a VAS Order and a corresponding work center, or it can be performed as part of the picking process.

A visual representation of a kit-to-order process, showing components being selected from inventory, assembled by workers, and shipped based on customer specifications.

Kit-to-Stock Process

The process of creating kits and then transferring them to stock is executed and documented in the warehouse. You can either trigger kit creation manually in the ERP system based on a production order or in the SAP EWM system directly, using a VAS order.

You can also perform reverse kitting, which splits a kit back into its components.

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