Inbound and Outbound Deliveries in SAP Software

Man working in delivery warehouse using SAP Software

Shannon Fagan/Getty Images

For most companies, the inbound and outbound delivery process is vital to the logistics operation. The procurement of materials needs to happen at the facility on their delivery due date so that they are available for the production of finished goods.

The delivery of finished goods to customers is equally as important to ensure that the customer has the highest level of customer service possible. In the SAP software system, the inbound logistics functionality incorporates inbound deliveries, inbound shipments, and goods receipts. The outbound logistics functionality covers the picking and packing of materials as well as the outbound delivery and goods issue.

SAP Software Inbound Logistics

It is important for companies to have total visibility of their inbound logistics function. If the logistics management can see which inbound deliveries are arriving they can schedule the correct resources to be available at the correct times so that materials are unloaded in a timely fashion without causing a bottleneck at the receiving dock. The inbound logistics process in SAP starts when purchase orders are processed at the vendor and an advanced shipping notification (ASN) is sent back.

When an ASN is received, this can trigger an inbound delivery to be created in SAP. The delivery will contain information on the vendor, the items, quantities to be expected, and the delivery details.

The delivery monitor is used to display and process open and completed deliveries. It is a single list that is easily reviewed. It shows deliveries that are due for picking or putaway and creation of transfer orders, deliveries for which picked quantities or putaway stocks need to be confirmed, and process deliveries that are due for goods receipt.

Goods receipts are used to record the items that are received from a vendor which have been sent using the information from a purchase order. The goods receipt is important as it moves the items into stock, updating the stock levels and allowing the items to be used in the production process. If an item is received into stock, the value of the item is posted to the company accounts. The goods receipt process can be triggered from the inbound delivery document already in the system or a manually created goods receipt document if no inbound delivery exists.

SAP Software Outbound Logistics

The outbound logistics gives visibility to the outgoing deliveries, allowing for detailed planning for packing and shipping. When customers order items from a company, sales orders are created and the outbound delivery document is generated to facilitate the picking, packing, and ultimate goods issue of the items as they are delivered to the customer. When the outbound delivery document is created, it can be viewed using the delivery monitor.

The picking process involves moving items from a storage bin in a warehouse and staging the quantity in a picking area where the items will be packed and then shipped to a customer. The picking of items can be an automated part of the outbound delivery process or it can be performed manually as required. When the warehouse staff complete picking and have taken it to the staging area, they can update the outbound delivery document to show that the picking has been completed. The shipment can be sent to the customer using a logistics company, such as FedEx or UPS, or by using company-owned vehicles. As soon as the items have left the facility, the shipping process is complete and the goods issue can then be posted.

The goods issue process triggers a number of events to take place in the SAP system. Initially, the inventory stock is reduced by the shipped quantity, and the financial details are posted to the balance sheet accounts.