This flowchart illustrates the Request for Quotation (RFQ) process, which is a key step in the procurement cycle within the SAP Materials Management (MM) module. The process involves the following steps:

• Need for Procurement:
  • The process begins when there is a requirement for materials or goods.
  • This need triggers the procurement process.
• Request Quotations from Vendors:
  • The buyer initiates the RFQ process by requesting quotations from potential vendors.
  • The goal is to gather competitive quotes for the required materials.
• Print RFQs:
  • The system generates and prints the Request for Quotation (RFQ) documents.
  • These documents contain details about the materials needed and are sent to the vendors.
• Quotations from Vendors:
  • Vendors respond by submitting their quotations in response to the RFQ.
  • Each vendor provides pricing, delivery terms, and other relevant information.
• Buyer’s Evaluation:
  • The buyer receives and evaluates the quotations.
  • Factors considered include price, quality, delivery time, and vendor reputation.
• Compare Quotations:
  • The buyer compares the different quotations received.
  • The goal is to select the most suitable vendor based on the evaluation criteria.
• Decision Point: Accept or Reject:
  • If a vendor’s quotation meets the requirements and is acceptable, the buyer proceeds to the next steps.
  • If a quotation is not suitable (e.g., too expensive or inadequate), it is rejected.
• Accept Quote:
  • If the quotation is accepted, the buyer confirms the selection.
  • The chosen vendor’s quotation becomes the basis for further processing.
• Maintain Source List:
  • The system updates the source list, ensuring that the chosen vendor is recognized for future procurement.
• Create PO Quotation (Purchase Order):
  • Based on the accepted quotation, the system generates a Purchase Order (PO).
  • The PO specifies the materials, quantities, and terms agreed upon.
• Procurement:
  • The materials are procured from the selected vendor.
  • The entire process ensures efficient and cost-effective material acquisition.