ORACLE PURCHASING

AUTHOR:SHIVMOHAN PUROHIT

Overview
Oracle Purchasing is a comprehensive procurement solution designed to help purchasing professionals to manage the procurement process at Right Price and in Right time and to develop strategic supplier relationships. Development of strategic supplier relationships requisitions,
Auto Create Purchase Requisition A u t o C r e a t e Request for Quotation (RFQ) Quotation

Supplier

Purchase Order

Receipts

Returns

Payments

Content
Unit I : Supply Base Management
Supplier Information Supplier List Sourcing Rule Approved Supplier List Automatic Sourcing Supplier Item Catalog

Unit II : Requisitions
Requisition Templates Purchase Requisitions. Internal Requisitions Managing Buyer Workload

Unit III : Request For Quotation and Quotation

Entering RFQs Auto create Entering Quotations Quote Analysis

Content
Unit IV : Purchase Orders
Standard Purchase Orders Planned Purchase Orders and Planned Releases Blanket Purchase Agreements and Blanket Releases Contract Purchase Orders Auto Create Purchase Orders and Releases Automatic Release Generation

Unit V : Receiving
Advance Shipment Notices (ASNs) Managing Receipts:Direct, Standard and Inspection Unordered,Cascade and Express Receipts Receiving Transactions Returns Corrections

Unit I : Supply Base Management

Key Features
Create and rank approved supplier lists by item or commodity Associate supplier item numbers with internal parts Prevent purchases from unapproved suppliers Compare actual volume to target volume by supplier Assess supplier price, service, and quality performance Create request for quotations (RFQ) automatically from on-line requisitions Create Purchase Orders automatically from on-line requisitions Define custom supplier quotation lists for RFQs Create supplier quotations automatically from RFQs, or enter them directly Analyze quotations and decide which should be available to reference on requisitions and purchase orders (POs) Access and reference your catalog/quotation information on-line while creating documents

Unit I : Supply Base Management

Supplier information is a vital part of Oracle Purchasing and is used in all components of procurement, beginning with the requisition request through to the payment for goods or services received. User need to define a supplier before performing any activities within Oracle Purchasing.

Purchase Requisition

Request for Quotation (RFQ)

Quotation

Supplier Information

Purchase Order

Receipts

Returns

Payments

Unit I : Supply Base Management

Supplier sites and Contacts:
User can identify multiple business sites for each supplier and enter specific purchasing details for each site. In addition, user can identify an unlimited number of contacts for each site. User can decide to which site or sites the invoices and purchase orders are sent. In addition , user can designate a site to receive only requests for quotation, until user certify the supplier as a purchasing site.

Supplier

Site-A

Site-B

Site-C

Contact 1

Contact 2

Contact 3

Contact 4

Contact 5

Contact 6

Navigation : Supply Base-> Suppliers Navigation: Supplier Base -> Supplier

Unit I : Supply Base Management

Site- Specific Information :
User has the ability to identify terms and conditions, purchase details and payment information for each supplier site. Terms and conditions Payment methods

Site-A

Supplier

Site-B

Terms and conditions

Payment methods

Site-C

Terms and conditions

Payment methods

Supplier Item Catalogue:

The Supplier Item Catalog provides a simple mechanism for locating items and their source information for the purpose of creating purchase order and requisition lines. User can open the catalog from an existing requisition or purchase order and add lines to that document. Alternatively, user can open the catalog from the Navigator and search for item information from there. The Supplier Item Catalog does not support Outside Processing.

Unit I : Supply Base Management

Supplier List :
Supplier Lists window will be used to enter and edit supplier lists. User can copy suppliers from the supplier lists onto the RFQ supplier list while creating Request For Quotation (RFQ).

Sourcing Rule:
User can define sourcing rules that specify how to replenish items in an organization, such as purchased items in plants. Sourcing rules can also specify how to replenish all organizations, as when the entire enterprise gets a subassembly from a particular organization. Refer to Profile option MRP: Default Sourcing Assignment Set This profile option indicates which sourcing rules assignment set will be used in Purchasing and Supplier Scheduling. Therefore, the Assignment Set name user choose for this profile option is the Assignment Set name should specify when user assign sourcing rules in the Sourcing Rule/Bill of Distribution Assignments window. This profile option must be set if you are using sourcing rules in Purchasing. Refer to Profile option MRP: Sourcing Rule Category Set If sourcing rule is used in Purchasing, this profile needs to be set to the name of the default category set used by Purchasing.

Approved Supplier List:

This repository includes information about all suppliers with business statuses including Approved, Debarred, or New. Use the Approved Supplier List and Supplier Item Attributes windows to specify blanket purchase agreements or quotations as source documents for a particular item and supplier or particular item category (commodity) and supplier. Purchasing automatically defaults this source document information,

Unit I : Supply Base Management

Automatic Sourcing: Automatic sourcing automatically defaults sourcing information onto the requisitions, blanket purchase orders, or quotations you create. User can easily assign any item with an item number to a specific blanket purchase agreement or quotation created. Purchasing automatically assigns the name of the supplier for the blanket purchase order and quotation to any requisition for this item.

Unit I : Supply Base Management

Refre to Profile Option - Po:Automatic Document Sourcing , Yes means that Purchasing automatically defaults source document and pricing information for an item from the most recently created blanket purchase agreement or quotation. No means that this source document information comes from the Approved Supplier List window, where you must specify which source documents to use.

Supplier Item Catalog: The Supplier Item Catalog provides a simple mechanism for locating items
and their source information for the purpose of creating purchase order and requisition lines. You can open the catalog from an existing requisition or purchase order and add lines to that document. Alternatively, you can open the catalog from the Navigator and search for item information from there. Navigation: Requisition/Purchase Orders Windows->click on Catalog button-> click on find button-> select the appropriate tabbed region (Negotiated sources, Prior Purchases, Sourcing Rule and Requisition Template.)->Select the down arrow to place the line on to order pad-> Select Select the Select button to add the order pad lines to the requisition or purchase order from which you accessed the catalog. Refer to profile option PO: Default Supplier Item Catalog Option, determines which of these tabbed regions is the default when the catalog opens from the menu. Attention: The supplier Name and Site, if you specify one, must match the sourcing rule Supplier and Site to default the supplier information or source document information successfully.

Unit I : Supply Base Management

Overview:
Sourcing Rule

Bye from Supplier A

Bye from Supplier B 50% of the time Rank 2

50% of the time Rank 1

Refer to Profile option MRP: Default Sourcing Assignment Set

Define Sourcing Rule for the Supplier

Create Assignment set

Assign sourcing Rule to Item and then to Assignment set

Navigation: Supplier Base -> Sourcing Rule

Unit I : Supply Base Management

Approved Supplier List:

Define ASL for each item, eneter Supplier name with business rule as direct and status as new/ approved/ Debar against each item and select

Enter source document (Quotation/Blanket Order) details Against each item in the attribute Window, to enable to default The source information while creating Purchasing documents

Unit II : Requisitions
Key Features Create, edit, and review requisition information on line. User should also be able to enter suggested supplier information,delivery instructions, multiple accounting distributions, and notes to buyers, approvers, and receivers. Review the current status and action history of requisitions.User should always know who approves requisitions and whether they are in the approval, purchasing, receiving, or delivery stage. Perform on line funds checking before creating requisitions. User should always know how planned expenses compare to budget. Access supplier/item catalogs to create documents Distribute expenses across multiple cost centers, projects, or departments Use multiple currencies Build account distributions automatically Use requisition templates for frequently requested items Import requisitions from other systems such as material or distributions requirement planning applications. Create internal requisitions that are sourced from your inventory by means of an internal sales order.

Unit II : Requisitions
Purchase Requisitions
With on-line requisitions, user can easily centralize the purchasing department, source the requisitions with the best suppliers. user can use Oracle Master Scheduling/MRP and Oracle Inventory to generate on-line requisitions automatically based on replenishment requirements. user can use Oracle Work in Process to generate on-line requisitions for outside processing requirements.

Internal Requisitions
Internal requisitions provide the mechanism for requesting and transferring material from inventory to other inventory or expense locations. Oracle Purchasing, Oracle Order Entry, and Oracle Inventory combine to give a flexible solution for inter-organization and intra-organization requests.

Requisition Template : Templates automate requisitioning of commonly ordered items like office supplies.
To create a template, user can specify the items individually or they can reference an existing requisition or purchase order. If user reference an existing document, Purchasing adds all lines on the document to the template. You can reference multiple documents to add all their lines to the same template. After user define a template, user can reference the template in the Supplier Item Catalog. When user do so, Purchasing displays all template lines that are valid for the destination organization.

Unit II : Requisitions
Requisition Import:
Using Requisition Import, user can import requisitions from other Oracle Applications or from non Oracle systems. Requisition Import lets user integrate Purchasing with new or existing applications. Master Scheduling/MRP, Work In Process, Order Management, and Inventory all provide requisition information to the requisition interface table from which Requisition Import creates requisitions.

Unit II : Requisitions
Oracle Modules MRP WIP Demand INV OM

Oracle Purchasing
Open Requisition Interface Table (1) Manually (3) Requisition Import Create Requisition Create Requisition (2) Use Catalog as source Requisition Approval

Navigation: (1) Requisitions-> . Requisitions (2) Requisitions -> . Requisitions->Catalog -> . Refer to slide no 9 for . further detail (3) Requests -> Select . Requisition Import -> . Select Source

Requisition Pool

Unit III: RFQ & Quotations

Request For Quotation and Quotation :
Purchasing provides user with request for quotation (RFQ), and quotation features to handle sourcing needs. User can create an RFQ from requisitions, match supplier quotations to user RFQ, and automatically copy quotation information to purchase orders. Purchasing provides complete reporting to control your requests for quotations and evaluate supplier responses. Identify requisitions that require supplier quotations and automatically create a request for quotation.

Quotation :
Use the Quotations window to: Enter and edit quotations, Review and edit quotations you copied from RFQs.

Quote Analysis: Use this window to approve the quotation.

Request For Quotation

Manually create RFQ
Supplier from Supplier List Navigation: RFQs and Quotations->RFQs Supplier A

R F Q

Enter RFQ

Supplier B

Supplier C

Autocreating RFQ

Navigation: Auto Create-> find-> Select document type as RFQ Auto creation

R F Q

Requisition Line Pool

Query existing lines

Choose lines from query results

Manual creation

Quotation

Manually enter quotation

Quotation analysis for approval / un approval

Copy document from RFQ window to create quotation

Navigation: RFQs and Quotations->Quotations RFQs and Quotations->Quotation analysis

Unit IV: Purchase Orders

Key Features:
Auto Create POs from on-line requisitions. Consolidate and centralize purchase requirements from multiple warehouses, plants, or locations. Create POs in any currency. Create standard purchase orders and blanket purchase agreements from both on-line and paper requisitions. Source a single requisition line from two or more suppliers Define purchasing contracts and reference them on Pos. Check funds availability while creating purchase orders so user always know how their planned expenses compare with budget Build account distributions automatically. Create POs for different types of items including services and one-time purchases. Provide multiple shipment schedules per PO line. Access sourcing and inventory information on-line while building Pos. Review the status and history of purchase orders at any time for all the information user need. Freeze, cancel, or final close POs to control future transactions. Record supplier acceptances.

Unit IV: Purchase Orders

Standard Purchase Orders:
User can create standard purchase orders for one-time purchases of items or services from a supplier. Each standard purchase order can have multiple lines. Each purchase order line can have multiple shipments distributed across multiple accounts. User can reference contract purchase agreement numbers on the lines of standard purchase order.

Planned Purchase Orders:

User can create planned purchase orders manually. A planned purchase order is a combination of a standard purchase order and a blanket purchase agreement. It includes tentative delivery information and accounting distributions for goods or services that user want to buy over a period of time. User can later issue scheduled releases against the planned purchase order to place the actual order. If user use encumbrance accounting, user can use the planned purchase order to reserve funds for long term agreements. Blanket Purchase Agreements: User can quickly define blanket purchase agreements for specific items and associated price breaks. Blanket purchase agreements allow stable pricing over the life of the agreement while allowing flexible delivery schedules and order quantity commitments as user release against the blanket.

Contract Purchase Agreements:

User can create contract purchase agreements containing master terms and conditions for a supplier and then reference the contract number on the line of a standard purchase order. Oracle Purchasing monitors the total amount you have spent against the contract purchase agreement.

Unit IV: Purchase Orders

Types of Purchase Orders : Standard, Blanket, Planned and Contract
Navigation: Purchase Orders -> Purchase Orders. Manually enter Purchase Order

Submit for approval

Copy document from Quotation window to create Purchase Order

Purchase Order Components

Document details (Header) Item or Service details (Lines) Supplier delivery (Shipments) Internal distribution details (Distributions)

Unit IV: Purchase Orders

Auto create Purchase Order : 1) .Standard PO, 2) Planned PO and 3) Blanket
Release PU R C H AS E O R D ER Submit for approval

Auto creation Query existing lines Choose lines from query results Manual creation

Requisition Line Pool

Select lines for auto create

Add lines to order pad for auto create

Navigation: Auto Create-> find-> Select document type as 1 or 2 or 3

Automated Purchase Order

Prerequisite
INV / WIP/ MRP &OM Modules 1) Set Profile option: PO: Release During ReqImport to yes 2) Create ASL with Business rule as direct and source as Approved Click on attributes Select Automatic releases as Release Method & blanket Agreement as a source document

Open requisition interface table

Requisition Import

Auto releases

Approved Blanket Release

Approved requisitions

ASL: Approved Supplier List Navigation: Supply Base ->ASL

Unit V: Receiving
Oracle Purchasing let user to control the items they order through receiving, inspection, transfer, and internal delivery. User can use these features of Oracle Purchasing to control the quantity, quality, and internal delivery of the items you receive.

Key Features:
Use routing controls to enforce material movement through receiving; for example, User can require inspection for some items and dock-to-stock receipt for others Control the quantity of items user receive, the acceptable delivery window, and acceptable receipt location with tolerances that user specify Optionally require blind receiving. Receive individual shipments or all items with a few keystrokes. Inspect items and evaluate supplier quality performance. Specify two, three, or four-way matching. Record receipt of unordered items based on user item, supplier, or organization defaults; for example, if user organization does not allow receipt of unordered items, user can prevent entry of a receipt unless it is matched to an order shipment Record receipt of substitute items based on user order, item, supplier, or organization defaults Return items to the supplying supplier Correct receiving transaction errors

Unit V: Receiving
Return Material Authorizations (RMAs)
User can use Purchasing receiving functionality to receive goods returned by their customers. These are goods for which a sales order in Oracle Order Management was created. If the customer wishes to return the goods, the sales representative creates a return material authorization (RMA) authorizing the return. When the return arrives at user receiving dock, user can create a receipt against the RMA as other receipt, inspect the return, return the repaired goods to the customer, and make receiving corrections.

Advance Shipment Notices (ASNs)

An Advance Shipment Notice (ASN) is transmitted via Electronic Data Interchange (EDI) from a supplier to let the receiving organization know that a shipment is coming. The ASN contains details including shipment date, time, and identification number; packing slip data; freight information; item detail including cumulative received quantities; country of origin; purchase order number; and returnable container information.

Receiving Locations
Receiving locations are designated areas in which user temporarily store items before deliver them to their final destinations. Receiving dock and the area in which items are inspected are receiving locations. Receiving locations are not required when the routing is Direct Receipt,

Unit V: Receiving
Unordered Receipts
User can receive items from a supplier when they do not have a corresponding purchase order. User can also receive returned items from a customer that were issued on a sales order in Order management and do not have RMA. First receive the items as Unordered Receipts in the Receipts window. User can create a new receipt or add to an existing receipt for the supplier or customer who shipped the unexpected items. Then perform a standard receipt for the unordered item shipment quantity. Then use the Match Unordered Receipts window to specify the purchase order or RMA number, release, line, and shipment schedule to which user want to match the unordered receipt.

Express and Cascade Transactions Purchasing offers two functions to facilitate transaction entry: Express and Cascade. In Express mode, user cannot modify default quantities, but they can record the delivery of many receipts at once. Cascade mode is applicable only for receipts for the same item. In cascade mode, Purchasing starts with the first receipt and enters deliveries for each subsequent receipt for this item until the cascade quantity is met.

Unit V: Receiving
Po lines with Standard receipt routing Receive items to Receiving Transfer stock from Receiving to Final delivery location D E L I V E R y

Po lines with Direct receipt routing

Receiving items directly into Final delivery location

Po lines with Inspection required

Receive items to Receiving

Enter Inspection results

Transfer accepted items To final delivery location

Return the rejected items back to supplier

Navigation: Receiving -> Receipts

Unit V: Receiving Types of Receiving Manual receipt One line at a time

Express receipt Multiple lines at one time Per supplier Cascade receipt One receipt of multiple shipment of the same item Per supplier

ORACLE PURCHASING