Supplier Groups

A Supplier Group is a category — Raw Material, Services, Local, Foreign, Logistics, Subcontractor. Use Supplier Groups to:

Default different payment terms per group
Filter spending analysis by group
Restrict purchasers to specific groups (e.g., a junior buyer can only order from "Approved Local Suppliers")
Apply different default accounts (for cost classification)

Where to manage them

Supplier Group → list view. ERPNext seeds a default (All Supplier Groups, Raw Material, Services, …); add your own structure.

Create a new Supplier Group

Supplier Group → New:

Field	What
Supplier Group Name	Raw Material, Services, Logistics, …
Parent Supplier Group	For tree structure
Is Group	Yes if it will have children; No if it's a leaf
Default Payment Days	Days you typically pay this category
Accounts	Optional — default expense account for purchases from this group

Tree structure

All Supplier Groups (root)
   Goods
       Raw Material
       Finished Goods (resale)
       Packaging
   Services
       Consulting
       Maintenance
       Subscriptions
   Logistics
   Utilities

Default inheritance

A Supplier inherits from their group:

Default Payment Terms (and thus Due Date on Purchase Invoices)
Default Tax Category (if you've split by domestic / EU / non-EU)
Default Expense Account (so all "Consulting" supplier invoices land in the right account)

The Supplier's own fields override the group.

Reports

Most purchase reports can filter by Supplier Group. Useful for:

"What did we spend on Raw Material this year?"
"Top suppliers per group"
"Average payment period per category"

Restricting buyers

For procurement teams where junior buyers shouldn't order from certain groups:

Open the User
User Permissions → Allow Supplier Group = [allowed groups]
Save

The user can only create POs for suppliers in those groups.

Common situations

Local vs Foreign — separate groups; foreign suppliers get different tax handling automatically
Approved vs Unapproved — "Approved Suppliers" group; junior buyers restricted to this group only
Single-source critical items — own group with stricter monitoring (Authorization Rules trigger on these POs)

Renaming and merging

Rename freely — Suppliers follow. To merge: move Suppliers from old group to new, then disable old.