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ERP Operations /  / Pricing

16 Fields in Pricing Procedure and Their Description

Added by Guest, last edited by Jyoti Prakash on Feb 08, 2011

Define Pricing Procedure

A pricing procedure is a procedure by w here in w hich you control the execution of condition tyoes in a sequence you w ould like . It not only executes the condition types but also controls the execution
of condition type by the use of requirements , altcv. altcbv, account key.
In other w ords, Pricing procedure is a systematic and sequential use of condition types to arrive at a right value of the product.
To determine the pricing procedure SALES AREA (Sales Organization + Distribution Channel + Division) + CUSTOMER PRICING PROCEDURE (from Customer master) + DOCUMENT PRICING
PROCEDURE (from Sales Doc type)
To view a select the pricing procedure in SPRO w hich is the standard and copy it and create our ow n pricing procedure.
Highlight it and double click the Control icon in the LHS screen.
We can see that there are 16 columns in the pricing procedure, these are going to be used by the system to control the condition types.
The detail description of each column is given below :

1. Step:
Number that determines the sequence of the conditions w ith in a procedure.
It indicates the position of the condition type in pricing procedure.
Ex.: 10, 15 etc.

2. Counter:
System uses the counter to count the steps and also it can be used to count mini steps of same condition types. So that number of steps can be reduced in the pricing procedure and hence enhancing
the system performance.
Access number of the conditions w ith in a step in the pricing procedure.
During automatic pricing, the system takes into account the sequence specified by the counter.

3. Condition Type:

It represents pricing element in pricing procedure as a base price, discount, freight and tax.
The condition type is used for different functions. In pricing, for example, the condition type lets you differentiate betw een different kinds of discount; in output determination, betw een different output
types such as order confirmation or delivery note; in batch determination, betw een different strategy types.
Ex.: PR00 - Price, K004 - Material Discount, K005 - Customer/Material Discount, K007 - Customer Discount.

4. Description:
System copies description of condition type from its description (V/06).

5. From and 6. To:

1. From: This can be used as a base to the condition type for calculating further value.
2. From and To: The range betw een the steps from and to can be used to specify the range betw een same condition types. So that depending upon the condition type, the system deducts or adds the
total value of those condition types from specific common source.

7. Manual:
This indicator specifies w hether the specific condition type can be determined manually during sales order processing.
If w e check the box then the entry is going to be manual, if w e uncheck it, it is going to be automatic.
For Base Price and Taxes, the entry should be automatic.
For Discounts and Freights, The entry should be manual.
If w e check the box, in VA01 w hen w e go to conditions at the header/item level, the condition type w ill not be listed. If w e require w e w ill have to manually enter it.
If w e uncheck the box, in VA01 w hen w e go to conditions at the header/item level, the condition type w ill be listed.

8. Mandatory:
This indicator specifies that particular condition type is mandatory in the pricing procedure.
If w e check the box, then in VA01 at the header/item level in the conditions tab, if w e delete the value in the condition type and try to save the document then system w ill not allow us to do it and throw s
an error.
If w e uncheck the box, then in VA01 at the header/item level in the conditions tab, if w e delete the value in the condition type and try to save the document then system w ill allow us to save it, w ithout
giving any error.
Mandatory check box should be checked in condition types w hich are compulsorily required in pricing procedure. Ex.: PR00, MWST.
If the condition type is checked w ith mandatory option, then value should be maintained for that condition type, otherw ise the system w ill not allow the user to process the document.

9. Statistical:
This indicator if it is activated w ill not allow the value of the condition type to be taken into net value calculation.
It is used only for information purposes only.
This indicator causes a surcharge or discount to be set in the document statistically (that is, w ithout altering the value).
This is commonly used for condition types
SKTO - Cash Discount
VPRS - Cost (Moving average price/Standard Price).

10. Print:
The value of this field specifies w hether line item can be printed or not in the sales document and at w hat level it is to be printed.

11. Subtotal:
The value of this field determines w here the values of subtotals to be captured i.e. in w hich table and w hich field.
Controls w hether and in w hich fields condition amounts or subtotals (for example, a customer discount or the cost of a material) are stored.
If the same fields are used to store different condition amounts, the system totals the individual amounts.
These condition amounts or subtotals are used as a starting point for further calculations. You may, for example, w ant a subtotal of all the discounts included in the pricing of a sales order.

12. Requirement:
It is a routine that is w ritten by an ABAP consultant according to the business requirement.
By defining Requirement in condition technique w e can restrict the access of condition type.
To understand the concept, w e w ill take the example of the Rebates. Rebates are to be included during the billing document processing and not in the sales document processing. As rebates are given
on the delivered quantity and not on the ordered quantity (in case of cut-off period for rebates).
For rebates w e use the condition types BO01 to BO05, and in the Requirement column w e give the value 24 w hich is "Only in Billing Document".
This Requirement w ill ensure that these condition types w ill appear only during the billing document processing.
If new Requirements are to be defined w e follow the procedure given below .
Go to T.Code: VOFM. - Maintain Requirements & Formulas
Click on the "Requirements" in the top menu and then click on "pricing".
We have a list of requirements, w e can ask ABAP consultant to create new requirement based on the client requests.
And w e assign the application type like V - Sales/Distribution etc.

14. AltCty - Condition formula for alternative calculation type:

It is again a Routine that is w ritten by ABAP Consultant.
It is an alternative formula for the condition type that can be used instead of standard formulas.
For example, let us take the Profit Margin w hich can be both + / - , so here this routine w ill help us in generating the value w hich can be either + or -. Profit margin is not a condition type so it cannot be
classified as +ve or -ve in the V/06.
Ex.: 950 0 Profit Margin 11.
So w e assign 11 - Profit Margin.
If new routines are to be defined w e follow the procedure given below .
Go to T.Code: VOFM. - Maintain Requirements & Formulas
Click on the "Formulas" and then on the "Condition Values".
We have a list of routines, w e can ask ABAP consultant to create new routines based on the client requests.
And w e assign the application type.

15. AltCBV - Alternative formula for condition base value:

Formula for determining the condition basis as an alternative to the standard.
It is again a Routine that is w ritten by ABAP Consultant.
It is used as a basis to calculate value of the condition type instead of using it from the "FROM" column.
Ex.: Freight - KF00.
Freight is calculated based on w eight, volume etc. and not on the base price. In pricing there is no entry of w eight from w hich the value can be referred like w e do for discounts using base price. We
have to get the value from the Material master.
In this column w e can mention the value as 12 - Gross Weight or 13 - Net Weight.
During pricing, the system w ill consider the value that is mentioned in this column and determine the freight based on this value.
Suppose w e have Net w eight: 100 kgs and Gross Weight: 150 kgs. And if w e mention 13 in this column then the Freight condition KF00 w ill be calculated using the w eight as 100 kgs.

16. AcyKy - Account Key/ Accrls - Accruals:

The values of the Sales Revenues, Sales Deductions, Freight Revenues, Tax Revenues, and Rebate Accruals etc. are going to be posted in the respective G/L accounts in Fi Module.
In order to do this w e assign account keys/ accruals to the different condition types based on their classification. The classification show n below .
ERB Rebate sales deduct.
ERF Freight revenue
ERL Revenue
ERS Sales deductions
ERU Rebate accruals
For Ex.,
For all Price condition types like PR00 etc. w e assign ERL - Revenue.
For all Discount condition types like K004, K005 etc. w e assign ERS - Sales Deductions.
For all Freight condition types KF00 etc. w e assign ERF - Freight Revenues.
For all Rebates condition types BO01 to BO05 w e assign in Account key ERB - Rebates Sales deductions and for Accruals ERU - Rebate Accruals.
This account keys and accruals are in turn assigned to respective G/L accounts. So the system posts respective values in respective G/L accounts in Fi-Co Module.
This also one of the areas of SD - Fi Integration. SD consultants assign the account keys and Fi Consultants assign the respective G/L accounts in T.Code:VKOA.

pricing

procedure

fields

configuration

4 Comments
Guest
Nicely explained..! thanx a lot

Guest
Good one...thank you..

atul kumbhani
Jyoti,
An excellent article w ith lots of added details. It really help new comers like us.
Keep up good w ork.
Regards,
-Atul

Aditya Garg
Pretty helpful. Thanks.

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