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The material type is a piece of basic information for SAP, used by any product or service that will be handled by the business: bought, produced, or sold.
When creating any material in the system, it is mandatory to select its material type, whether from the list of standard options, or your company's customized options.
The main difference between material types will be reflected in the Material Views that can – or must – be opened for any material of this type that will be created later in the system.
Depending on the system customization that has been done, some views will simply not be allowed to be created for the product. For example, it would not be possible to create sales views for products that aren’t sold by the company or to add production data to a material that is not manufactured internally.
During the creation of a new material using MM01 transaction, it is mandatory to select a material type, to select the views and functionalities that will be available to that product or service.
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