SAP EWM Warehouse Billing

SAP EWM Warehouse Billing

Article by Romain Cailleau, SAP Supply Chain Consultant at Beelogix


Since EWM 9.3, SAP has introduced the “SAP EWM Warehouse Billing” which clearly position EWM as a WMS for LSP (Logistic Service Provider). This new feature has been designed to sell warehouse services and bill them periodically based on the services used for a time period.

Base concept:

The Warehouse Billing behaves in two different manners:

  • As a Logistic Service Provider, bill your customer for providing warehouse services such as distribution center services
  • As a customer or LSP, credit your own LSP for outsourced warehouse services such as an external labors hired for loading/unloading

Warehouse Billing - Base Concept

The Warehouse Billing solution acts with:

  • SAP EWM as the billing measurement engine in addition to the known core warehouse execution system in order to:
    • Provide snapshots of warehouse activities (stock usage, inbound received, outbound issued, warehouse task level) in a period manner
    • Define what need to be measured for billing with the Billing Measurement Request representing the agreement with the customer
    • Periodically triggers the distribution of measurement result for settlement
  • SAP TM or SAP ECC as contract engine for service charge calculation and settlement
  • SAP ECC directly or through SAP TM as financial engine using out-the box capabilities of billing, invoice verification…

The overall solution approach detailed afterwards is using EWM as billing measurement engine and ECC as contract and financial engine as follows:

EWM as billing measurement

Prototype Business case:

In order to demonstrate our customers, the potential of the tool, Beelogix team designed and implemented a prototype of the solution and here are the details of the business case:

Four measurement services will be considered:

  • Weight of Inbound Delivery received per billing period = Received weight
  • Number of Outbound Delivery line shipped per billing period = Shipped delivery line item
  • Number of Internal Warehouse Tasks Confirmed per billing period = Number of internal movement
  • Bin used per billing period = Storage bin usage

The following pricing will be applied for each service provided:

  • Received weight: Flat rate of 2CAD/TON
  • Shipped delivery line: Flat rate of 5CAD/EA
  • Number of internal movement: Flat rate of 1,20CAD/EA
  • Storage bin usage: Scale rate as shown below

WB - Pricing

Processes:

  1. As agreed with the customer in this business case, four services will be tracked and billed to the customer. In order to capture the data relevant with this agreement, Billing Measurement Services will be assigned at Billing Measurement Request Item level as follow:

Billing Measurement Services

Of course, note that different recipes are possible depending on the agreement done with the customer as shown in this 2nd example where “Outbound Delivery Note Printing Service” and “Exceptional Penalty Charge for Clarification Activities” are only considered:

WB - Two measurement services assigned

  1. As soon as all the Measurement Services have been assigned, it is now possible to activate the Billing Measurement Request:

WB - Measurement Services assigned

  1. Using a Background-Job or triggered manually, the system captures snapshots of all the activities that have been performed. Here is the physical stock that have been captured:

WB - Activities snapshots

  1. Using a Background-Job or triggered manually, the Billing Measurement is generated. This Billing Measurement has been created for a determined period of time, from the 06/30/2016 until the 07/04/2016 in the example.

Billing Measurement results are aggregated per billing period that depends on the factory calendar maintained for the warehouse. In the example, the billing period goes as follow:

  • One billing period per day from Tuesday to Friday
  • One unique billing period from Saturday to Monday includedWB - Billing Measurement
  1. Using a Background-Job or triggered manually, distribute the Billing Measurement to SAP ERP.

WB - Distribtue Billing Measurement

WB - Distribtue Billing Measurement Message

The standard out-of-the-box distributes the billing measurement in SAP TM. However, SAP made the solution flexible and offers BADI to adapt this logic.

By implementing some very simple code within the appropriate BADI, we did succeed to redirect this distribution to SAP ERP via the creation of Sales Order.

  1. After the distribution of the Billing Measurement from EWM, a sales order is automatically created in ECC with the quantities that have been captured for the billing period. The pricing that have been put in place is automatically applied.

Each measurement services have been modelled as “Material” in SAP ERP with their dedicated pricing condition. This enables to leverage the powerful SAP ERP pricing functionality and create sales order “priced” based on the customer agreements.

WB - Sales Order in ECC

 

Let’s now create the invoice and just enjoyed Warehouse Billing functionality with EWM 9.3! Looking forward to show you other great features in the next article.