Steps to Create Auto PO in SAP

Introduction to Auto PO in SAP

Let’s face it—manual purchase order (PO) creation in SAP can be a time-consuming hassle, especially when you’re dealing with hundreds or even thousands of purchase requisitions (PRs). That’s where Auto PO (Automatic Purchase Order) comes into play. This feature in SAP lets you generate POs automatically based on existing PRs or at the time of goods receipt (GR), saving time, reducing errors, and streamlining procurement operations. If you're trying to wrap your head around how it all works, you're in the right place.

Prerequisites for Auto PO Creation

Before you can successfully generate Auto POs, you need to tick off a few must-have settings. Two of the biggies? Your material master and vendor master records. In both, you’ll find a checkbox labeled "Automatic PO"—this needs to be selected. This setting basically tells SAP, “Hey, I’m okay with creating POs automatically for this material/vendor combo.”

Key Difference: Auto PO from PR vs. GR

Here’s the thing—a lot of folks get tripped up between auto PO from PR and auto PO during goods receipt (GR). They’re not the same. Creating Auto POs from PRs is a purchasing process function, typically run via T-code ME59 or ME59N. On the other hand, Auto PO during GR happens in MIGO if the system is configured to allow PO creation at the point of goods receipt. Separate paths. Separate use cases. Don’t mix them up.

How to Enable Auto PO in Material Master

To enable Auto PO in the material master, go to MM02 and navigate to the “Purchasing” view. There you’ll see a checkbox called "Automatic PO." Once checked, this allows SAP to create a PO automatically for this material—provided all other settings align. Think of it as one piece in a larger jigsaw puzzle.

Setting Up Auto PO in Vendor Master

Next stop: Vendor master. Use T-code XK02 or MK02 (BP - S/4HANA) and go to the “Purchasing Data” view. Again, there’s a checkbox labeled “Automatic Purchase Order.” This allows SAP to create POs automatically when this vendor is involved. If this isn’t checked, Auto PO won’t work, even if your material settings are perfect.

Required Customizing Settings in SPRO

Alright, now we’re diving into the nitty-gritty of SAP customizing (a.k.a. SPRO). If you want to enable Auto PO creation during GR, head over to:

SPRO -> Materials Management -> Inventory Management and Physical Inventory -> Goods Receipt -> Create Purchase Order Automatically

Here, make sure the movement type (like 101 for GR) has the "Automatic PO" option enabled. If not, MIGO won’t generate a PO during GR—even if everything else is set up properly.

Using MIGO for Auto PO During GR

So, what happens if the system is set up to allow Auto PO during MIGO? 

When you perform a goods receipt against a PO-less inbound delivery or directly against a vendor, SAP creates a PO in the background. This is often used in scenarios like subcontracting or where lead times are ultra-tight and creating a PO beforehand just slows you down.

Creating Auto PO from Purchase Requisition

Now, if you're looking to convert existing PRs into POs automatically, you'll want to use T-code ME59 or ME59N. Here's a simple walkthrough:

1. Run ME59N.
2. Select the relevant purchasing group, plant, and vendor.
3. Execute.

Bam! If all settings are correctly in place, SAP will generate POs for all eligible PRs in one go.

Info Records and Outline Agreements

One common reason Auto PO fails? Missing purchasing info records or outline agreements. These documents store essential data like unit price, delivery terms, and lead times. SAP needs this data to generate a PO automatically. If it’s missing, SAP throws an error and says it can’t find a “suitable item.”

The Role of Source List in Auto PO

Another critical setup is the source list. This tells SAP which vendor to use for a specific material at a specific plant. You can create and maintain source lists using ME01. Ensure your source list is marked as “fixed” and “relevant for MRP” if you want it to work with Auto PO generation.

When ME59 Fails: Troubleshooting PR Errors

Let’s say you try to run ME59N and get the dreaded “No suitable item found” error. What gives? Usually, it’s one of three things:

1. Missing info records.
2. No source list.
3. PR hasn’t been released (more on that below).

This error is SAP’s way of saying, “I don’t have enough data to create a valid PO.”

Handling PRs with Release Strategy

If your PR is subject to release strategy and hasn’t been released yet, Auto PO won’t happen. Period. SAP is strict about approvals. You’ll need to release the PR either manually (using ME54N) or via workflow before the system will allow conversion to PO.

Using ME56 and ME58 for Manual Interventions

Sometimes Auto PO just isn’t feasible. Maybe you’re missing a source list or info record. In those cases, you can manually assign vendors to PRs using ME56. Once that’s done, use ME58 to create POs semi-automatically. Not as hands-off as ME59, but it gets the job done.

Advanced Settings and SAP Best Practices

For more complex environments, consider setting up document types specific to Auto POs, customizing message outputs, and defining user roles with strict authorization profiles. You can also use BAPIs and IDocs to automate Auto PO processes through integrations.

Real-World Scenario: From PR to Auto PO

Let’s say you’re a procurement manager at a manufacturing firm. You’ve got 200 raw material PRs generated by MRP. You’ve got source lists, info records, and release strategies all set. You run ME59N and within seconds, 200 POs are created and emailed to suppliers. That’s the power of automation—efficiency at scale.

Common Pitfalls to Avoid

Even seasoned SAP users mess up Auto PO setups. Common mistakes include:
  • Forgetting to check “Auto PO” in master data
  • Not maintaining source lists
  • Missing info records
  • Trying to convert unreleased PRs
Each of these can bring Auto PO to a screeching halt.

Benefits of Auto PO Implementation

The big win? Time savings. But there’s more:
  • Lower error rates
  • Faster procurement cycles
  • Better audit trails
  • Happier vendors (because they get POs faster)
Auto PO isn’t just an IT trick—it’s a business enabler.

Final Thoughts and Recommendations

Auto PO in SAP is one of those features that feels like magic when it works—and a nightmare when it doesn’t. The key is to ensure all the master data, customizing settings, and release processes are perfectly aligned. Start with a pilot, test it thoroughly, and then scale up. Trust me—it’s worth the effort.

Frequently Asked Questions (FAQs)

1. Can I create Auto PO without a source list?
Technically yes, but not reliably. For consistent results, always maintain a source list.

2. Is Auto PO suitable for all material types?
Not necessarily. It works best for standard stock materials. Services and configurable materials may need manual review.

3. How do I check why Auto PO failed?
Run ME59N in test mode. SAP will display detailed error messages for each PR.

4. Can I restrict Auto PO to certain vendors only?
Yes, by controlling which vendors have the “Automatic PO” flag checked in their master data.

5. What reports can I use to monitor Auto PO activity?
Use ME2M (by material), ME2K (by account assignment), or custom Z-reports to track POs created via automation.

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