The main advantage of using blanket purchase orders is the reduction in order processing costs. These are significantly lower because of the following:
The blanket purchase order is valid for a longer period.
There is no goods receipt or service entry.
It is not necessary to create purchase order items for individual procurement transactions.
You generally use collective invoices (for example, monthly invoices).
Blanket Purchase Order
For a limit item, you must enter the following data:
- Item category E (Enhanced Limit) or B (Blanket Item)
- Short Text
- Material Group
- Plant
Account Assignment Category
In contrast to normal material items, you can use the account assignment category U (Unknown) in a limit item. If you use account assignment category U, you only specify the account assignment at the time of invoice entry. Note that no commitments can be created in Controlling for the account assignment category U (Unknown).
Overall Limit and Expected Value
The overall limit represents the maximum value for which you can post invoices referencing the purchase order item. If the overall limit is exceeded when you post an invoice, the system issues a warning or error message, depending on the settings in Customizing. The expected value is the order value with the supplier. If you work with the release procedure for purchasing documents, this value serves as the basis for a release strategy. Controlling uses this value to create the purchase order commitment. If the expected value is exceeded when you post an invoice with reference to a blanket purchase order, the system does not issue a notification unless the overall limit is exceeded.
In a limit item, you cannot enter a material number, a purchase order quantity, or a net price. As soon as you enter the expected value when you create the limit item, it is automatically adopted as the net price.
In SAP S/4HANA, there are two ways to create a limit item in a purchase order:
With the Manage Purchase Orders app:
You use NB (Standard PO) as the purchase order document type. You create the limit item on the Limit Items tab page. This automatically determines the item category E (Enhanced Limit) for the item.
You enter the validity period of the item in the item details under the Schedule Lines in the Start of Performance Period and End of Performance Period fields.
With the Create Purchase Order – Advanced app:
You use FO (Framework Order) as the purchase order document type. You create the limit item with item category B (Blanket Item) in the item overview.
You enter the validity period in the header data of the purchase order.
Note
Note that with the Create Purchase Order – Advanced app, you can also create a blanket purchase order with item category E.