Supplier Sites and Supplier Site Assignments

The site represents a business relationship between a procurement business unit (BU) and the supplier.

Create Site

Sites are created in a procurement BU. A procurement BU represents a specific purchasing or sourcing organization that's responsible for establishing and maintaining supplier relationships. The site allows a specific procurement BU to set terms, controls, and policies which govern how procure to pay transactions are executed between its client BUs and the supplier. Many of these site attributes are optional must be set only when there is a need to deviate from a BU level policy. For example, the supplier might require more restrictive receipt and invoice tolerances. Procurement policy terms and controls that are defined for a supplier are maintained at the supplier site level.

These details are available for a site:

• Procurement BU

• Site name

• Site address

• Site purposes: Purchasing, Pay, Procurement Card, Primary Pay, and Sourcing Only.

  • When a new site is created, the site purposes are set by default, based on the address purposes. The address purposes reflect the sales functions that the supplier claims to perform at their location, whereas the site purpose indicates the equivalent procurement functions the buying organization transacts with the location, which can be a subset of the address purposes.

    Note:

    If the address is both RFQ and Ordering, then the site maps to a purpose of Purchasing, because sites with the Purchasing purpose are used in both purchasing and sourcing transactions.

Sites also feature an Additional Details region to capture additional information that can be defined by the buying organization. This information is referred to as descriptive flexfield information.

Use the subtabs on the Sites page to configure the controls that determine how purchasing, receiving and invoicing transactions are executed with the supplier.

Subtabs on the Sites page include:

• General: User can provide additional identifier information including a customer number, which is the internal number the supplier uses to identify the buying organization, alternate site name, and a tax reporting indicator.

• Purchasing: User can define purchasing terms for this site including communication details, self-billing information, freight, and hold controls.

• Receiving: Provide information relating to receiving controls such as over-receipt tolerance, early receipt tolerance, receipt routing and so on

• Invoicing: Define invoicing controls and terms such as invoice currency, payment currency, invoice-related holds, match approval levels, payment terms, pay date basis, third-party payment relationships, and so on.

• Payments: Define supplier bank accounts, preferred payment methods, and other payment processing attributes for the site. Bank account information is used for paying supplier invoices by electronic funds transfer (EFT).

• Site Assignments: Maintain the set of client BUs that can use the site for purchasing and invoicing purposes.

• Qualifications: View the assessments and qualification outcomes for supplier.

Site Assignments

Site assignments control which client BUs can transact with the site. In addition, the bill-to BU associated with the client BU is defined. Bill-to BU represents the organization that assumes the liability for the purchases made on behalf of the client BU. In most cases, the client BU and the bill-to BU are the same. However, users can set up a different bill-to BU for a specific client if required.

The premise of the site assignment model is to leverage the centralized procurement organization which negotiates terms and sets policy controls. These terms and controls established for a supplier site are used by the client BUs as a result of being assigned to the site. Without the site assignment model each client BU would be forced to establish its own relationship with the supplier. The service provider relationship between the client BU and procurement BU is defined in the business unit setup.

Creating a Site Assignment

There are two ways to create site assignments. You can manually create one assignment at a time by selecting the specific client BU, or you can use autocreate.

Every supplier site must have an active assignment to create transactions against the site, such as purchase orders or invoices. In other words, if a site assignment doesn't exist or is inactive, you can't create transactions for that supplier site.

In a site assignment, only Client BU and bill-to BU are required values. To create a site assignment for a client BU, provide these details:

• Client BU: Select the appropriate BU from the list of all requisitioning and invoicing BUs that are serviced by the procurement BU.

• Bill-to BU: The bill-to BU identifies the business unit responsible for processing invoices for the purchase order.. However, in certain instances due to tax or legal reasons the client BU may only perform requisitioning with the supplier and another BU assumes the liability for the purchases. In this case a different bill-to BU is selected. The list of bill-to BUs that can be selected for a given client BU is determined by the Intercompany Transaction Flow setup. In addition, when a separate bill-to BU acts as an agent to the client BU an assignment must be created for the bill-to BU in order for the BU to process invoices.

• Ship-to Location: Identifies the default shipping location used on purchasing documents for the client BU.

• Bill-to Location: Identifies the default billing location used on purchasing documents for the bill-to BU.

• Inactive Date: Determines when the assignment record is no longer active.

• Withholding tax information: Indicate whether withholding tax is enabled for the assignment and if yes, identify the tax group in which it's classified.

• Liability Distribution: The liability distribution for new invoices.

• Prepayment Distribution: The distribution for prepaid expenses.

• Bill Payable Distribution: The distribution for future-dated payments.

• Distribution Set: A predefined group of general ledger accounting codes that would determine the debit accounts for other receipt payments.