An enterprise that operates with a central purchasing organization covering several plants can often negotiate better conditions at a central level. The enterprise has the option of creating contracts that relate not to just one particular plant but to the purchasing organization.
The plant is not specified until the contract release order is created. All plants assigned to the purchasing organization can be released against a centrally agreed contract. For items with a material master record, the material must be created for each plant for which you are issuing a release.
In plant-specific contracts, a release order can only be created for the relevant plant. In a centrally agreed contract, however, you can store different conditions or partners for individual plants.
A centrally agreed contract can also be created from a central purchasing organization. When creating a contract item, the system does not check whether the purchasing organization that creates the contract is responsible for a particular plant. This check only occurs in the contract release order. If the release order is performed from another purchasing organization, the central purchasing organization of the releasing purchasing organization must be assigned as the reference purchasing organization.
With centrally agreed contracts, you can specify separate conditions for each receiving plant. These could be the result of different transportation costs for different distances. Plant conditions are not supplementary conditions for the central conditions; they are independent conditions for a specific plant.