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SAP MM Split Valuation Guide

SAP MM Split Valuation

A Complete Visual Guide to Understanding and Implementing Split Valuation in SAP MM (ECC & S/4HANA)

What is Split Valuation?

Split valuation helps in evaluating the stock of the same material in the same valuation area (plant or company) but with different prices or valuations. It allows organizations to track material costs separately based on various criteria.

Key Concept: Split valuation refers to the valuation type on a material master that allows you to differentiate stock valuation.

Example: Different Types of the Same Material

A single material can have different valuations based on its condition:

New Product ($100) Used Product ($60) Repaired Product ($80)

The valuation field on the material master allows you to track these stocks separately, each with its own price despite being the same material.

Types of Split Valuation Criteria

Origins

  • Country of origin
  • Different vendors

Quality

  • Grades of material
  • Quality levels (A, B, C, D)

Status

  • New
  • Used
  • Repaired

Production Type

  • In-house production
  • External production
Business Use Case: A company produces a component in-house but sometimes needs to procure the same component from external suppliers due to capacity constraints. In-house costs are typically lower than external procurement costs. Split valuation helps track both stocks separately.

Split Valuation Configuration Process

Step 1: Activate Split Valuation

First, we need to activate the split valuation functionality in the SAP system.

Transaction: SPRO → MM → Valuation and Account Assignment → Split Valuation → Activate Split Valuation
OR
T-Code: OMW0
By default, split valuation is activated in most systems. Always check before proceeding with configuration.

Step 2: Define Global Types

Define the types of split valuation you need based on your business requirements.

Transaction: SPRO → MM → Valuation and Account Assignment → Split Valuation → Define Global Types
Key Configuration Settings:
  • Global Type (e.g., "ABROAD" for international procurement)
  • External Purchase Order: Allowed/Not Allowed
  • Internal Purchase Order: Allowed/Not Allowed
  • Account Category Reference: Check with T-code OMSK

Step 3: Define Global Categories

Map your global types to valuation categories (single-digit identifiers).

Transaction: SPRO → MM → Valuation and Account Assignment → Split Valuation → Define Global Categories
Key Configuration Settings:
  • Valuation Category (e.g., "A")
  • Description (e.g., "Domestic/Abroad Procurement")
  • Assignment of Global Types created in Step 2
Important: Don't forget to click on "Create" instead of "Save" to complete this step.

Step 4: Define Local Definitions

Activate the split valuation for specific plants and material types.

Transaction: SPRO → MM → Valuation and Account Assignment → Split Valuation → Define Local Definitions
OR
T-Code: OMWC
Note: In this screen, arrow keys and mouse scrolling may not work. Use Page Up/Down keys to navigate.
Configuration Progress

Implementation Example: Domestic vs. International Procurement

Setup
Material Master
Procurement
Results

Configuration Setup

In this example, we'll set up split valuation for a material that can be procured from both domestic and international suppliers.

Global Types

  • ABROAD: International procurement
  • DOMESTIC: Domestic procurement

Global Category

  • Category: A
  • Description: Domestic/Abroad Procurement

Local Definition

  • Plant: 1000
  • Category A activated

Material Master Setup

After configuration, we need to create a material and activate split valuation for it.

Transaction: MM01 - Create Material

Key Steps:

  1. Create material with basic views (Basic Data 1, Purchasing, General Plant Data, Accounting)
  2. In Accounting view, activate valuation category A
  3. Save material
  4. Run MM01 again for the same material to maintain valuation types
  5. Set up prices for each valuation type:
    • ABROAD: $20 per unit
    • DOMESTIC: $10 per unit
Important: Price control must be "V" (Moving Average Price) for split valuation.

Procurement Process

Now let's create purchase orders for both valuation types.

Transaction: ME21N - Create Purchase Order

International Supplier PO

  • Vendor: International Supplier
  • Material: Test Material
  • Quantity: 1
  • Price: $20
  • Valuation Type: ABROAD

Domestic Supplier PO

  • Vendor: Domestic Supplier
  • Material: Test Material
  • Quantity: 1
  • Price: $10
  • Valuation Type: DOMESTIC

Goods Receipt:

Transaction: MIGO - Goods Receipt

Perform goods receipt for both purchase orders, maintaining their respective valuation types.

Verification of Split Valuation

Transaction: MMBE - Stock Overview

You should now see two different stock quantities distinguished by valuation type.

Total Stock ABROAD Stock DOMESTIC Stock
Quantity 2 1 1
Unit Price $15 (avg) $20 $10
Total Value $30 $20 $10
Transaction: MM03 - Display Material

Check the accounting view of your material with and without valuation types:

  • Without Valuation Type: Moving average price is $15 (average of both)
  • With ABROAD Valuation Type: Price is $20
  • With DOMESTIC Valuation Type: Price is $10

Alternative Testing Method

Instead of going through the entire procurement process, you can use transaction code MIGO with movement type 561 to update initial stock with different valuation types.

Transaction: MIGO → Other → 561 (Goods Issue)
  1. Select movement type 561
  2. Enter material number
  3. Enter plant and storage location
  4. Select valuation type
  5. Update stock quantity and save
  6. Repeat for each valuation type
Time-Saving Tip: This method is faster for testing purposes but doesn't simulate the full procurement process.

Summary: Split Valuation Process

1. Activate Split Valuation (OMW0) 2. Define Global Types (e.g., ABROAD, DOMESTIC) 3. Define Global Categories (e.g., Category A) 4. Define Local Definitions (OMWC) 5. Create Material Master (MM01) 6. Activate Valuation Category (MM01 - Accounting View) 7. Maintain Valuation Types (MM01 - Set Different Prices) 8. Create Purchase Orders (ME21N with Valuation Types) 9. Verify Split Valuation (MMBE, MM03)

© 2025 SAP MM Split Valuation Complete Guide

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