What is Transfer Order in SAP?

The Transfer order or requirement contains information about a planned movement of stock in the warehouse. The corresponding transfer order contains the information the system needs to carry out the movement, that is, the physical movement of a specific quantity of material from one place to another.

Goods are placed into a storage bin, removed from a storage bin, or transferred from one storage bin to another within the warehouse using transfer orders. Transfer orders are also used to track the “logical” transfers of stock. Logical transfers of stock occur, for example, when goods are returned from inspection and made available for general use. These logical transfers are called posting changes in the Warehouse Management (WM) system.

Transfer Order in SAP

You can print out transfer orders in the warehouse after they are created, so that the physical stock movement can be carried out immediately. You can also require that certain stock movements be confirmed. This means that the warehouse worker must indicate that the physical transfer took place.

Sometimes the quantity that should be transferred is not the quantity that is actually transferred. You can enter this difference when the transfer order is confirmed. With the confirmation of the delivery and the entry of differences, the system can ensure that the book inventory is the same as the physical inventory.

How is a Transfer Orders Created?
You can create transfer orders by referring to another document, such as a transfer requirement, a delivery document, or a material document. You can also create a transfer order without referring to any other document.

What Information Does a Transfer Orders Contain?
In order to carry out its function, a transfer order must contain a material number, the quantity to be transferred, where the material is located, and where the material is to be delivered. The information that the transfer order needs comes from several sources:

movement types

  1. material master record
  2. warehouse management movement type
  3. strategies for finding the source or destination storage bins
  4. user entries
  5. source documents, such as transfer requirements and deliveries

How is a Transfer Order Structured?
The transfer order consists of a transfer order header, which contains general information about the entire order, and one or more items.

Transfer Order Header
The transfer orders header identifies the transfer order number and the date that it was created and confirmed. It also identifies the transfer requirement on which it is based and the movement type. If the transfer order has been printed, the Transfer order printed check box is marked.

Transfer Order Item
A transfer order contains one or more items. The number of items depends on how many storage bins the system accesses in order to reach the total quantity of goods needed by the transfer requirement (stock removal) or how many bins are needed to store the goods (stock placement).

An item within a transfer order contains two or three subsections that identify the direction of the stock movement

  1. out of a warehouse or from an interim storage area (the source of the stock). This subsection contains the storage bin and the amount of material that is being transferred from a storage area.
  2. into a warehouse or an interim storage area (the destination of the stock). This subsection contains the storage bin and the amount of material that is being transferred into a storage area.
  3. return to storage. The system generates a return subsection when a quantity remains after the material, in the desired quantity, is removed from a storage bin. This can happen if, for example, a full issue is defined for the source storage type, but the entire quantity has not be requested. The return quantity is returned to its original storage bin or transferred to another one.
  4. The transfer orders number and item number are displayed at the top of the item screen. The item screen provides specific information about the movement of a quantity of material from a source storage bin to a destination storage bin.

If the actual quantity is the same as the required quantity, the difference quantity will be zero.

Also See: The difference between Logistics, Inventory Management & Supply chain Management

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