The document discusses a case study of calculating preferential rules of origin using the NET COST method in SAP GTS for a company with multiple plants in the US. There are gaps in SAP's standard process that do not allow considering individual plant prices or cross-plant bills of material where there is a stock transfer. The proposed solution involves customizing the feeder and GTS systems to address these gaps and allow a more accurate calculation.

1. A case Studyof Preference inSAPGTSforNET COST Method
KarthikGunda
SolutionArchitect, SAPSD&GTS
YASH TECHNOLOGIESPVT LTD
Case detail:
A companyhas itsmanufacturingspreadacrossmultiple plants inUSand has a needtocalculate
NAFTA preference ontheirproducts. Let’sSaythere are 2 Plantswithinthe US.
SAPGTS recommendsusingaPlantgroupcomprisingthese plantsif the partsare incommon.
In the eventof calculatingthe RVCbyNETCOST Methodon a Static BOM, througha TOP Down
Approach
There are 2 importantfactorsofferedinSAPGTS
1) The cost of a component whichis lowestamongthe 2 plantswill be consideredfor
Preference
2) The BOM will be consideredfromotherplantsbasedonthe alternative BOMexplosion
Andits relatedconfiguration
BusinessRequirement:
The Componentsbelongingtootherplantsneedstobe considered,howeverthe price needstobe
takenonlyfromindividualplants
The Cross PlantBOM needstobe triggeredbasedonSpecial procurementindicatorsmentionedin
the Material Master of the Feeder,andshouldapplytothe caseswhere there isastock transferas
the procurementvalue
GAP:
1) The process as per standardSAPcannot be consideredbasedonindividualplantlevel prices
ina plantgroupbasedBOM
2) The BOMs fromotherplantscannot be consideredforthe procurementvalueswherethere
isa stocktransferdefined

2. A case Studyof Preference inSAPGTSforNET COST Method
KarthikGunda
SolutionArchitect, SAPSD&GTS
YASH TECHNOLOGIESPVT LTD
Solution:
Necessary changesinFeederSystem
In Feedersystemthere isscope todefinethe configuration,fortransferringthe BOMinthe
followingpath
IMG-> Sales&Distribution->ForeignTrade/Customs->SAPGTS-Plugin->“Control Transferof Billsof
Productfor preference andRe-export”

3. A case Studyof Preference inSAPGTSforNET COST Method
KarthikGunda
SolutionArchitect, SAPSD&GTS
YASH TECHNOLOGIESPVT LTD
One can control the BOMtransferwiththe optionsprovidedasfollows
Howeverinthe sectionabove onlythose typesof BOMsthat are selectedwouldtransferintoGTS
Thisis the firststepto considerwhile enablingthe CrossplantBOM’s
AlternativeBOM’ssectionpereachPlantoffersmore scope tofurtherrefine the crossplant
explosion
The control relatedtocrossplant BOMexplosionbasedonspecial procurementstill donotexistin
thisabove configuration transaction.
For thisto happen, inthe Transferroutine program, the changeswill needtobe made inthe
functionModule CS_BOM_EXPL_MAT_V2, whichisusedinthe transaction
/SAPSLL/BOMMAT_DIRR3.
The custom Logic needstobe basedaccordingto ConfigurationentriesdefinedthroughTable T460A
Againstthe Special Procurementtype(SOBSL) andSpecialProcurement-External Display(SOBES)
NecessaryChanges inGTSSystem:
The Plantshave to be definedasindividual Legal Units,the price transferred fromFeedertothe
productmaster inGTS wouldbe recorded as perindividualplantsinthatcase
Material Transfer,Price transfer,ProcurementIndicatortransferhastobe done fromFeederinto
GTS system,Furtherthe classificationsneedtobe maintainedagainstall componentsaswell asthe
headers.

4. A case Studyof Preference inSAPGTSforNET COST Method
KarthikGunda
SolutionArchitect, SAPSD&GTS
YASH TECHNOLOGIESPVT LTD
A Comparisionof the RVC(NETCOST)calculationaccordingtoBothApproaches:
Impact of above customapproach changes:
 EnsuresLTVD’sare maintainedforall externalprocuredcomponentsinall the relevant
plantsof that plantgroup
 Allowsplantspecificprices,providinggreateraccuracyincalculation
 The Tarriff shiftresultsare more accurate,enablingtoidentifythose classificationsthat
maybe definedinthe “Exclusion”or“Inclusion”listinafew rules
Conclusion:
By allowingthe explosiontomore levels(inclusiveof otherplants withstocktransferprocurements),
more control and accuracy ispossible.
Top Down
Method
Material Code
Is it a
BOM?
Procurement
Indicator LTVD Maintained?
Originating
Value
Production
Cost
Non
Originating
Value
SAP
Approach
M0704 Yes IN Not Applicable 32$ 3$ 26$
1054 No EX
Maintained, Though
the supplier is a
plant under same
co.code 12$
Not
Applicable
IF Required RVC is 55% as per the Rule
Then Originating Content is 57.37% and the
product qualifies in this method
1339 Yes IN Not Applicable
Adjusted in
Production
costs
Not
Applicable
10446 No IN Not Applicable 5$
Not
Applicable
20323 No IN Not Applicable 15$
Not
Applicable
1340 No EX Not Maintained
Customized
Approach
M0704 Yes IN Not Applicable 23$ 4$ 34$
1054 Yes IN
Maintained, Though
the supplier is a
plant under same
co.code
Adjusted in
Production
costs
IF Required RVC is 55% as per the Rule
Then Originating value is 44.26% and the
product DOES NOT qualify in this method
124A No EX Not Maintained 8$
10446 No IN 3$
1339 Yes IN Not Applicable
Adjusted in
Production
costs
Not
Applicable
10446 No IN Not Applicable 5$
Not
Applicable
20323 No IN Not Applicable 15$
Not
Applicable
1340 No EX Not Maintained 26$