Optimizing Third Party Sales Processes in SAP SD

Third Party Sales In Sap Sd

As an SAP S/4HANA SD consultant, I will be discussing the Third Party Sales procedure in the SAP S/4HANA system in this blog.


Let’s start with a brief explanation of the “third party sales” process’s capabilities.


In order to facilitate third-party processing, SAP provides the TAS item category and CS schedule line category. The CS schedule line category includes default settings for the purchase requisition type, item category, and account assignment, which triggers the creation of a purchase requisition for the order line items. On the other hand, the TAS item category has billing relevancy F, meaning that billing for the order item can only occur once an invoice receipt is posted for the purchase order.

To create a third-party material in SAP SD, you can use the item category Group BANS in MM01. For manual purchase orders, there is no need to indicate automatic creation. However, for automatic purchase orders, you can utilize the item category ALES which already has the indicator set for automatic PO creation. To allocate the purchase information to a specific sales organization, it should be done in SPRO.

In order to create a sale order with an OR order type, you can use VA01.

To find the Purchase Requisition Number associated with a created sale order, open it in VA03 and check the Schedule Line Tab where you will see the PR number.

You might be interested:  Understanding the role of Master Data and Transaction Data in SAP

Finally, if needed, convert the purchase requisition into a purchase order using ME21n.


The business receives a bill from the vendor which needs to be approved. Invoice verification is important for this process, as it involves checking the invoice receipt against the purchase order. The system uses T code MIRO to verify various details such as received amount and prices during this process.

Billing for Customers in SAP SD

A third-party transaction is a type of business deal where there are three main participants involved. Usually, there is a buyer, a seller, and another person or company known as the third party. This means that instead of just the buyer and seller interacting directly with each other, they involve an additional entity in their transaction.

In simple terms, imagine you want to buy something from an online store. In a regular transaction, you would browse the website, select your item, pay for it directly to the store owner or company (the seller), and then receive your purchase. However, in a third-party transaction scenario, there would be an intermediary involved between you (the buyer) and the online store (the seller). This intermediary could be someone like PayPal or Amazon Pay who handles the payment process on behalf of both parties.

The purpose of involving this third party can vary depending on different factors such as trust issues between buyers and sellers or specific requirements for certain types of transactions. It provides an extra layer of security by ensuring that payments are processed securely before goods or services are delivered to the buyer.

– A third-party transaction involves three main participants: a buyer, a seller, and another entity called the third party.

You might be interested:  Understanding the Definition of Sap

– The involvement of this additional entity helps facilitate secure transactions between buyers and sellers.

– The role of the third party can include handling payments on behalf of both parties or providing added security measures during transactions.

What does SAP mean by 3rd party vendor?

Third-party processing is a crucial aspect of the Sales and Distribution (SD) and Materials Management (MM) components in SAP. It involves creating a third-party item within a sales order, purchase requisition, or purchase order to facilitate direct shipment of goods from the vendor to the customer.

In this process, when a customer places an order for certain products that are not available in your own inventory, you can create a third-party item in the sales order. This triggers the creation of a purchase requisition or purchase order with the vendor. The vendor then directly ships the goods to your customer on behalf of your company.

By utilizing third-party processing, companies can streamline their supply chain operations by eliminating unnecessary handling and storage costs associated with receiving and storing goods before shipping them out again. This method also allows businesses to offer a wider range of products without having to maintain extensive inventories themselves.

P.S: Third-party processing plays an essential role in optimizing supply chain management by enabling direct shipment from vendors to customers. By leveraging this functionality within SAP SD and MM components, businesses can enhance efficiency while reducing costs associated with inventory management and logistics processes.

What does the SAP third party item category refer to?

In the standard third-party process, the delivery is directly made from the third-party partner. This means that the item category used in this process is TAS. The TAS item category allows for seamless coordination between the sales order and the delivery, ensuring a smooth transaction between all parties involved.

You might be interested:  Understanding the Role of a Business Partner in SAP

On the other hand, there is also an alternative method known as individual purchase order processing. In this scenario, the delivery is initiated by the third-party partner to SD-partner first, and then a normal delivery is created from the sales order. This approach provides more flexibility in terms of managing deliveries and allows for better control over inventory levels.

Please let me know if you need any further assistance or information!

Configuring third-party sales in SAP SD: A step-by-step guide

First the item category grourp of the material will be BANS. which means it is an third party and the item category will TAS and the schedule line CS which automatically creates a purchase order in the” order type ” we should specify “nb”. First u have to create a vendor using XK01 (central).

Differentiating between first party and third party sales

The difference between these two types of data lies in their origin and ownership. First-party data is more reliable and accurate since it comes straight from your own interactions with customers. It allows you to have a better understanding of their preferences and behaviors. On the contrary, third-party data may not be as trustworthy since it is gathered by external parties without any direct connection to your business.

– First-party data: Information collected directly from your audience through channels like websites or newsletters.

– Third-party data: Data acquired by an external entity unrelated to your relationship with customers.

– First-p