Understanding Scrap Types in SAP PP for Efficient Production

In production planning, dealing with scrap is inevitable. SAP PP offers functionalities to manage different scrap scenarios, ensuring accurate material requirements and cost calculations. This blog explores the three main types of scrap in SAP PP: assembly, component, and operation.

1. Assembly Scrap:

This scrap occurs during the final assembly process, where the finished product yield falls short of the planned quantity. A percentage is defined in the material master record to account for assembly scrap (MRP view 1). This increases the planned production order quantity and, consequently, the required components.

2. Component Scrap:

This scrap happens when a higher-than-expected component amount is consumed during production. Unlike assembly scrap, it’s specific to a single component. The scrap percentage is maintained in the bill of materials (BOM) or MRP view 4 of the material master record. It only affects the specific component, not the overall finished product quantity.

3. Operation Scrap:

This scrap arises during a specific operation within the production routing. The percentage can be entered in either the routing or the BOM. The system considers the operation scrap entered in the routing as a percentage of the planned activity quantity. When entered in the BOM (with the “Net Scrap” indicator activated), it reflects a percentage of the material amount used in that operation.

Understanding the Impact:

Each scrap type has a distinct effect on production:

• Assembly scrap inflates the production order and component requirements.
• Component scrap increases the needed quantity of the specific component with scrap.
• Depending on where it’s defined, Operation scrap reduces either the planned activity quantity or the material quantity used in that operation.

Effective Scrap Management:

By accurately defining scrap percentages in SAP PP, manufacturers can:

• Maintain realistic production plans that account for material wastage.
• Ensure adequate component availability to avoid production delays.
• Track and analyze scrap trends to identify areas for improvement.

Conclusion:

Understanding and effectively managing scrap in SAP PP is crucial for efficient production planning and cost control. By leveraging the functionalities of different scrap types, manufacturers can optimize their processes, minimize waste, and achieve better production outcomes.