Sales Order Process

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Sales Organization

 A sales organization is responsible for negotiating sales conditions and distributing goods and services.  It represents the top organizational level to which you sum sales figures. There must be at least one sales organization defined  A sales organization is assigned to only one company code.  More than one sales organization can be assigned to a company code.
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Distribution Channel
Sales Organization Distribution Channel Wholesale Retail Direct

 A Distribution Channel is the way sales materials reach the customer.  A distribution channel can be assigned (serve) to more than one sales organization.  Distribution Channels allow for different conditions such as minimum order quantities and pricing.
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Divisions restrict access to materials. At least one division must be defined. so care should be exercised in defining divisions.Division Sales Organization Product Line 1 Divisions Product Line 2 Product Line 3     Divisions are used to present product lines. 4 . Divisions can be assigned to more than one sales organization.

Sales Area Sales Organization 1 Distribution Channel 1 Division 1 Division 2 Distribution Channel 2 Division 1 Sales Organization 2 Distribution Channel 1 Division 1 Division 2  A Sales Area is a valid combination of Sales organization.  Simple organizational structures are usually preferred to complex ones.  Customer Master Data and Sales Documents are linked to sales areas. Distribution Channel and Division. 5 .

Fitter Snacker Sales Organization Fitter Sales (##FS) Wholesale (WH) Snackbar (SB) Direct (DI) Snackbar (SB) 6 .

It may be a loading dock.  Lead times for determining delivery dates are associated with shipping points.Shipping Point  A shipping point is a fixed location that carries out shipping activities. a mail room or a shipping department. 7 .  One plant can have multiple shipping points.  A shipping point can serve multiple plants.

Customer Order Cycle Pre-Sales Activities Sales Order Processing Inventory Sourcing Payment Billing Delivery 8 .

. “is the product in stock . phone calls. Mailing lists can be generated based on specific customer characteristics.  Sales Support allows for tracking of customer contacts by including sales visits. 9 .”)  Quotes are binding documents to a customer offering a specific quantity of material at a specific price if accepted within a specific period. .”. . letters and direct mailings.Pre-Sales Activities  There are two categories of presales activity: Sales Support and Pre-sales Documents.  Inquiries document customer requests for information (“how much is . .  Both Inquiries and Quotes can be used as a starting point to create a customer order. Basically an Integrated CRM system.  Pre-sales contacts include inquiries and quotes.

Sales Order Processing  Customers place orders with a customer service representative who create a document* with information on:  Customer  Material Ordered .material and quantity  Pricing conditions for each item  Schedule lines .delivery dates and quantities  Delivery Information  Billing information  Information is pulled from master data on customers and materials to minimize data entry errors. *Electronic Capture of a Business Event 10 .

 From production or purchase orders that should be available.  Shipped from another plant or warehouse.Inventory Sourcing  Inventory Sourcing determines:  If a product is available (availability check).  Shipped from an external supplier.  From make-to-order production.  How the product will be supplied:  From stock on hand. 11 .

 When the delivery document is created.  An order is changed.Inventory Sourcing  Inventory sourcing occurs when:  An order is created. 12 .

Delivery  Delivery activities include:  Creating delivery documents  Creating transfer orders for material picking  Provide packing information (if required)  Goods issue (updating accounting and inventory data) 13 .

14 .Billing  A Billing Document is created by copying information for the sales order and delivery document into the billing document which is used to create the invoice.  Creating a Billing Document will automatically debit the customer’s accounts receivable account and credits the revenue account. Postings may also be made to other accounts.

 Reconciling differences.).  The Cycle may not always go as planned (material not in stock. if necessary. SAP has procedures to deal with these possibilities. 15 . etc.Payment  Payment is the final step in the customer order management cycle.  Final payment includes:  Posting payments against invoices. defective material returned for credit.

Order Management Process Pre-Sales Contract Contact Inquiry Quotation Order Scheduling agreement Materials Management Materials Management Sales Information System Sales Information System Production Planning Production Planning Sales Order Processing Inventory Sourcing Delivery/ Transportation Billing Payment/ Accounting Delivery Goods issue Transfer Order Shipment Invoice Material Stock Account Accounts Receivable 16 .

Accounting document 100000269  The sales order management process consists of a chain of steps. .) creates a document to keep track of the changes. . Invoice 90000376 . 17 . . etc. Each step in the process causes the creation of a document which can be used to track the progress of the sales order. . WMS transfer order 100000828 . GD goods issue: delivery 40000184 . Delivery 50000672 . .Document Flow Order Delivery Invoice Accounting Document Flow of a Sales Order Order 900 . delivery. All changes to documents (sales orders.

Document Flow 18 .

 When creating business transactions (like a sales order) the R/3 system copies information from master data.  Three kinds of master data are critical to sales order processing:  Customer .Master Data Customer Master Material Master Pricing Master  Master Data is centrally stored (shared across application modules) and is processed to eliminate data redundancy.Shared with FI/CO  Material .Shared with MM and PP  Pricing 19 .

data is copied from:  Customer Master  Material Master  Condition Records for Pricing  Tables in Configuration for shipping point and route. 20 .  Data can also be copied from an inquiry or quote.Creating an Order Customer Master Sold-to party 2540-00 Item Material 1 1400-500-00 2 1400-100-00 Quantity 30 20 Material Master  When a sales order is created in R/3.

 Delivery dates are determined based on lead times associated with the shipping point (picking and packing time) and route (transportation lead times and transit times) 21 .Shipping Point and Route SP 1 SP 2 SP 3 Plant Shipping Point Route Customer  The Shipping Point is the logical or physical location where deliveries are created and managed (see Organizational Elements).  The Route is the path that the delivery follows from the plant to the customer site.

Stock Available: Backward Scheduling Material Transportation Availability Date Planning Date Loading Date Goods issue date Requested Delivery Date Order Date Loading Time Pick Pack and Stage Transportation Lead Time Transit Time The R/3 System uses the longer of these two times in calculating delivery scheduling. 22 .

Stock Unavailable: Forward Scheduling Confirmed Delivery Date Order Date New Material Transportation Availability Date Planning Date Loading Date Goods issue date Loading Time Pick Pack and Stage Transportation Lead Time Transit Time The confirmed delivery date is derived by the R/3 System using forward scheduling based on the new material availability date 23 .

Sales orders may split into multiple deliveries (availability). 24 .Delivery Complete Delivery Partial Delivery Sales Order Sales Order Delivery Delivery Delivery Delivery Order Combination Sales Order Sales Order Delivery     A delivery can be created for each sales order. Combined sales orders must have something in common like shipping point. delivery processing date. ship-to party or route. A delivery may combine a number of sales orders for efficiency.

Picking Process Delivery Transfer Order Print Transfer Order Confirm Transfer Order* * not mandatory Delivery Items Complete Process differences Copy picked quantity Create a new transfer order for variance quantity 25 .

Billing Invoice Split Sales Order Delivery Invoice Invoice Delivery Delivery Delivery Delivery Delivery Invoice Invoice Invoice Separate Sales Order Invoice per delivery Collective Sales Order Invoice Sales Order  Invoice splits can be used to bill for different items like materials and services. 26 .  Collective invoices can be used to consolidate deliveries onto one invoice to minimize paperwork.

Pay to $ 4325 Dollars  Customers may send one check to cover multiple invoices.  Payment posting is performed by the accounts receivable department. 27 . They may also send checks for less than the full amount due. SAP allows for partial payments to be applied to invoices.Posting Payments Invoice 1 Invoice 2 Invoice 3 Invoice 4 First National Bank 2132 123123 54545 345 34 Acme Corp.

Fitter Snacker Exercise West Hills Athletic Club Sales and Distribution Inquiry 1 Pricing Availability Sales Order 2 28 .

Fitter Snacker Exercise Pick 4 Materials Management Goods Issue 5 Sales Order Delivery 3 Delivery Delivery 29 .

Fitter Snacker Exercise Invoice West Hills Athletic Club Sales and Distribution Accounts Receivable Delivery 6 Post Receivable 7 Receivable 30 .

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