What is purchasing organization in SAP (SRD-SRM - SRM-Supplier Relationship Management)?

SAP Term: purchasing organization

• Component: SRD-SRM

• Component Name: SRM-Supplier Relationship Management

• Description: A subdivision of the purchasing community of an enterprise. A purchasing organization can independently maintain relationships with suppliers and may have its own supplier-specific procurement conditions. It may be responsible for purchasing for all companies in a corporate group, for one company in a corporate group, or for one company location.

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• Key Concepts: 
  A purchasing organization is a unit within an enterprise that is responsible for the procurement of goods and services. It is part of the SAP SRM (Supplier Relationship Management) component and is responsible for managing the relationship between the enterprise and its suppliers. It also handles the negotiation, selection, and ordering of goods and services. 
  
  How to use it: 
  The purchasing organization is used to manage the procurement process. It is responsible for setting up contracts with suppliers, negotiating prices, and ordering goods and services. It also handles the payment process, including invoicing and payment terms. The purchasing organization also keeps track of supplier performance and provides feedback to ensure that suppliers are meeting their contractual obligations. 
  
  Tips & Tricks: 
  When setting up a purchasing organization, it is important to ensure that all relevant information is included in the setup. This includes supplier information, payment terms, and any other relevant details. Additionally, it is important to ensure that all contracts are up-to-date and that any changes are communicated to suppliers in a timely manner. 
  
  Related Information: 
  The purchasing organization is part of the SAP SRM component, which also includes other features such as supplier evaluation, supplier performance management, and supplier collaboration. Additionally, the purchasing organization can be integrated with other SAP components such as Materials Management (MM) and Financial Accounting (FI).