You can think of a contract as a source of supply. When a purchase requisition allocates a supply source, it can be allocated to a contract and then converted into a purchase order. Alternatively, you can create an order by referring to the contract when creating the order.

Some functions of the planning agreement are similar to those of the contract. It is also a relatively long-term framework agreement signed with suppliers. However, the planning protocol is more flexible. It can be configured to automatically generate the delivery plan or manually maintain the delivery plan, so migo can receive the goods directly from the plan agreement on the delivery date.

When the source list is automatically maintained, contracts and planning agreements will be regarded as sources of supply. You can assign a purchase requisition to a planning agreement and then convert it into a delivery plan instead of a purchase order when processing.

Of course, if the material has a plan agreement, the system can be configured to automatically run the delivery plan for mrp instead of the purchase requisition.