Shipping component in SAP system begins from Outbound delivery creation and supports a lot of functions. The important one’s are:

  • Picking
  • Packing
  • Deliveries
  • Processing Goods Issue


Picking process involves taking goods from physical storage location and transferring to picking area based on the pick listinformation, where it would be further processed for packing. Picking information on exact quantity is then fed back in SAP system on delivery. Picking would be relevant for all materials except materials which are created for services. Material is stored in plant in a storage location. In a delivery, to pick the material, storage location should get determined. Storage location determination –Rules are defined so that different criteria can be used. Picking from storage location can be done using MM-WM, warehouse management function or can be done manually in the delivery.


Packing is integral part of shipping. When delivery is being processed, delivery items can be selected for packing and assigned to handling units. This functionality enables provision of packing information of delivery items to customer & helps in unloading. This also helps in updating information on stock of packaging materials for organization, also allows for representation of multiple levels of packaging. Like items packed in box, which is loaded on pallets and then onto truck. Items are packed into ‘Handling Units’(HU’s). Initially empty handling units are created in packing screen of delivery into which the materials are packed and information on weights and volumes are fed into it. In Standard SAP system material type for packaging materials is “VERP’.  The packaging materials can be added in delivery as an additional item created w/o reference to sales order. Provisions are also made in standard SAP system settings to process returnable packaging materials to cater to industry requirements.

Goods Issue

Immediately after goods leave company, goods issue for the materials needs to be posted in SAP system. Goods issue has following effect in SAP system:

  • Warehouse stock of material is reduced by delivery quantity.
  • Value changes are posted to Balance sheet account in inventory management.
  • Requirements are reduced by equivalent of delivery quantity.
  • Serial number is updated.
  • Goods Issue posting is recorded in document flow.
  • Updates Billing due index for further creation of billing documents.

Goods issue is processed using following options:

  • Goods Issue posting for Individual outbound deliveries
  • Collective goods issue processing for multiple outbound deliveries in foreground mode.
  • Collective goods issue processing for multiple outbound deliveries in background mode

Integration exists between the MM and FI modules to automatically post to relevant balance sheet accounts based on the movement type and transaction.

1 thought on “Shipping

  1. Thanks for giving an idea of the shipment flow.I have read all the other posts too.I must say its great to have such lucrative information to help people like me who are planning to indulge in packing and shipping industry.

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