Streamlined Stock Transfer Process

with SAP Implementation for an India

based Refrigerator Manufacturing

Company

Business Challenge

As one of the leading manufacturers of commercial refrigeration equipment, our client faced

severe challenges to manage stock transfer from the manufacturing plant to the depot, as the

margin of stock was mishandled by depot users.

Process flow of Stock Transfer Order (STO) Process before configuration

VL02N

Freight

Sales and Distribution

Material Management

Goods

receipt

Create Purchase order

Create

outbound

delivery

Create post goods

issue

Create Pro forma

invoice

- Basic Price

- + Freight

- + Margin

- (condition to be maintained in

MM)

- Basic Price

- + Freight

- + Margin

- (condition to be maintained in Sales

and Distribution)

ME21N

VL10B VF01 MIGO

Execute

Purchase

Order

Add Picking

Quantity

Project Details

Customer Size: Large Private sector

Country: India

Domain: Manufacturing

Solution Provided:

o SAP Solution: SAP ECC 6.0

o Modules: SD, MM, FI, ABAP

Client Profile

Our client is one of the largest manufacturers of

commercial refrigeration equipment in India.

They started as a trading company with supply

of air-conditioning and refrigeration parts in

1972. Owing to their expertise and success, they

forayed into setting up cooling plants, and then

ventured into the manufacturing of horizontal

coolers and freezers. Over the years, they have

expanded their business and now have

operations spread across 16 locations in India.

Being a leading manufacturer, our client has a

cumulative capacity of exporting 3,50,000+ units

per annum across 45 countries.

The solution used by the client to manage the freight and margin for the goods required a lot

of human intervention which resulted in data duplication. This hampered the company’s efforts

to achieve goals and objectives resulted in business disruption due to the misleading balance

sheet numbers from the standpoint of Material Management, Sales and Distribution.

In order to fill the gaps and rectify the existing processes, they required a solution developed

using SAP to automate and streamline the processes and eliminate human intervention.

Cygnet’s Solution

Process flow of Stock Transfer Order (STO) Process post configuration

After understanding and analyzing the client’s requirements, industry challenges, and the

expected outcome from the proposed implementation, the Cygnet SAP team helped the client

implement the processes and enable an automated and streamlined stock transfer order process.

Based on its in-depth expertise in SAP module implementations, the Cygnet team implemented

different modules such as Materials Management, Sales and Distribution, Finance, and Advanced

Business Application Programming to render a simplified stock transfer process. Cygnet was able

Material Management

Create

Purchase order

Create Outbound

delivery

Create Post goods

issue

Create

pro forma

invoice

Goods

Receipt

ME21N VL10B VL02N

VF01 MIGO

(Basic Price, Freight & Margin values directly come from

PO to Pro Forma invoice by Enhancement)

Legend:

: Process

flow indicator

Execute Purchase Order Add Picking Quantity

to understand the client’s challenges and provide a customized solution. The major

improvements accruing from the solution included:

Data Management from a single location: The client used to enter and manage the data from

two locations including material management and the sales and distribution site which was a

time-consuming process and brought forth challenges. Based on the analysis of the existing

workflows, the Cygnet team designed a solution in which they provided a process that

maintained all the data at one location, which not only saved time and effort, but also eliminated

the possibility of data duplication.

Streamlined the stock transfer process: Cygnet provided a stock transfer process in which the

end user enters the data only once at the manufacturing site including creating a purchase order,

and other outbound delivery data as well as post goods issues. After loading the goods, the user

generates invoices and once the goods have reached the depot, the goods receipts are

produced.

Enabled automation: To avoid any errors and duplication in generating invoices, Cygnet

provided an automated process in which the original data of Purchase Order (PO) value is directly

fetched including the basic price of the product, freight, and margin value while maintaining the

Pro -forma invoice.

Benefits to the Client

Auto determined freight and other expenses at the time of billing that helped reduce

human intervention by 80%

Effective process implementation resulted in faster data management

The simplification of the complex process was delivered in the brief span of 1 month

Accurate data and faster reporting