Defining the Firm, Trade-Off, and Planning Zones using SAP MM Outline Purchase Agreements With Vendors

Use

Rolling delivery schedules created under scheduling agreements are divided into different time zones indicating the degree to which the lines of the schedule are binding. You can define the following time zones:

• Firm zone (zone 1) (go-ahead for production).

The schedule lines within this zone count as firm and thus as fully binding. If you cancel a schedule line that falls within the firm zone, the vendor is entitled to charge you with both production costs and the costs of procuring input materials incurred by him as a result of the cancellation.

• Trade-off zone (zone 2) (go-ahead for procurement of input materials)

This is the "semi-firm" zone, giving the vendor the go-ahead to procure necessary input materials to manufacture the item ordered. If you cancel a schedule line within this semi-firm zone, the vendor is only entitled to charge you the material costs. Schedule lines falling within this time zone are thus less binding that those falling within the firm zone.

• Planning zone (zone 3) (forecast)

All schedule lines that lie beyond the first two zones (that is, delivery is tentatively scheduled for quite a long way into the future) fall within the planning zone.

The firm and trade-off zones are printed out in the schedule for the user’s information. For each schedule line that falls within a certain zone, it is assumed that the relevant material is procured in accordance with the conditions that apply to this zone (e.g. schedule lines falling within the firm zone are fully binding).

You can specify whether Materials Planning may change schedule lines that fall within the firm or trade-off zones.

Activities

1. On the scheduling agreement item overview screen, select the item for which you wish to define delivery schedule time zones.
2. Choose Item
® More functions ® Additional data.
3. In the Firm zone field, enter a number of days (calculated from the current date) defining the period after whose expiration the firm zone ends and the trade-off zone begins.
4. In the Trade-off zone field, enter the number of days (calculated from the current date) defining the period after whose expiration the trade-off zone ends and the planning zone begins.




If the firm zone is to cover one month, enter the value 30 (days) in the Firm zone field. If the trade-off zone ends one month after the firm zone, enter the value 60 in the Trade-off zone field.

5. In the Binding for Materials Planning field, specify whether Materials Planning may change schedule lines that fall within the firm or trade-off zones.
6. Save your data.

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