Material types

The material master is the starting point for the rest of the modules.
What Material Types are there?
The material types that you use are configured in Customizing for the Material Master under
Logistics Master Data : Material Master -> Material -> Control data -> Define material type attributes.
The following list shows you the material types contained, for example, in the standard SAP R/3 System, and what their different roles are:

DIEN
Services
Services are procured externally and cannot be stored. A material master record of this material type can always contain purchasing data.

FERT
Finished products
Finished products are produced by the company itself. Since they cannot be ordered by Purchasing, a material master record of this material type does not contain purchasing data.

FHMI
Production resources/tools
Production resources/tools are procured externally and used in the manufacture of products. A material master record of this material type can contain purchasing data, but no sales data. It is managed on a quantity basis. Examples of production resources/tools are apparatus, equipment, and measuring and testing devices.

HALB
Semi finished products
Semi-finished products can be procured externally (sub-contracting) as well as manufactured in-house. They are then processed by the company. A material master record of this material type can contain both purchasing and work scheduling data.

HAWA
Trading goods
Trading goods are always procured externally and then sold. A material master record of this material type can contain purchasing and sales data.

HIBE
Operating supplies
Operating supplies are procured externally and required for the manufacture of other products. A material master record of this material type can contain purchasing data but no sales data.

NLAG
Non-stock material
Non-stock material is material that is not held in stock because it is consumed immediately. (Office supplies such as stationary. You need to create purchase order and accounting document for payment but the stock balance is always zero as it is issued out immediately to the various department.)

ROH
Ram material
Raw materials are always procured externally and then processed. Since raw materials cannot be sold, a material master record of this material type contains no sales data.

UNBW
Non-valued materials
Non-valuated materials are managed on a quantity basis, but not by value.

VERP
Packaging materials
Packaging materials are used to transport goods and come with the goods free of charge. A material master record of this material type is managed both on a quantity basis and by value.

WETT
Competitive products
Competitive products have their own material master records created from the Basic Data view. The competitor's number, which is stored in the material master record, assigns the material to a particular competitor.

Contracts for trading business in SAP - HAWA

For companies/divisions which are in trading business(no processing - either importing or buying locally and selling):

• Trading goods - Material type as HAWA (this can be found in Logistics Master Data : Material Master -> Material -> Control data -> Define material type attributes). For more information on Material Types, please follow the link.
• Material master record of this material type can contain purchasing and sales data
• Sales Document - either scheduling agreements or quantity contracts with pricing & its respective date of delivery can be used
• To create contracts - Logistics -> Customer Service -> Service Agreements -> Contracts -> Contract -> Create
• To create scheduling agreements - Logistics -> Sales and distribution -> Sales (then) Choose Outline agreement -> Scheduling agreement -> Create
• Advantage of using scheduling agreements are you can have your own delivery dates according to your client. From scheduling agreement you can directly create a delivery instead of going to sales order and then creating a delivery for the same.