Linkedin - Freegoods in SAP MM

Document prepared by Mr Behram SAP MM & PM Master Trainer.
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FREE GOODS IN SAP MM

Brief
Free Goods in SAP is giving certain material/quantity as free of charge based on Order quantity.
Free Goods are of two types in SAP, Inclusive Free Goods and Exclusive Free Good.
If the Free Goods quantity is a part of Order quantity, it is said to be Inclusive Free Goods.
Example: Buy 10 get 1 free is the Policy. Customer is charged for 9 qty. only and one is given
free.
If the Free Goods quantity is in addition to Order quantity, it is said to be Exclusive Free Goods.
Example: Buy 10 get 1 free is the Policy. Customer is charged for 10 qty. and one is given
extra
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Materials Management
Purchasing
Conditions
In this section, you make the system settings that are relevant to the maintenance of conditions and price
determination in the purchase of materials.
Define Price Determination Process net price or effective price

The following steps describe how the price determination process is controlled.
Before you set up the price determination facility in the SAP System, you should do the following:
• Check the dependencies under which prices, discounts, and surcharges are arrived at.
For example, determine whether different conditions apply to individual material groups and the basis
on which surcharges and discounts are calculated.
• Then bring your pricing dependencies into line with the criteria for price determination in the SAP
System.
• After this, work through the following sections.
Note
For further information on this topic, please refer to the documentation "SD Pricing and Condition Technique".
Define Schema Groups

Short Text
Define schema groups for your suppliers and purchasing organizations, and assign schema groups to
purchasing organizations.
In this step, you define schema groups.
These allow you to group together purchasing organizations that use the same calculation schema.
You can also use them to group together suppliers for whom the same calculation schema is valid.
(Note: calculation schemas may also be referred to as "pricing procedures".)
For example, you can define one schema group that uses a simple calculation schema with just a price and a
discount, and another that works with a more complex schema containing a large number of conditions.
Example:
Define a schema group that uses a simple calculation schema with only one price and a discount, and a
schema group that works with a more complex schema containing a large number of conditions.
Activities
In this step, you can:
• Define schema groups for purchasing organizations and suppliers
• Assign schema groups to your purchasing organizations
Note:
You assign suppliers to schema groups in the relevant supplier master records.
Define Schema Groups for Suppliers
Discount in Kind (Discount in Form of Bonus Goods)

In this step, you make all of the settings that are necessary for the use of the free goods functionality.
Maintain Access Sequence

In this step you define access sequences for free goods determination.
The access sequence is a search strategy which is used by the SAP system to search for a free goods type
according to valid free goods rates.
The free goods rates are used in the SAP system to model free goods elements.
You enter an access sequence in every free goods type. In doing so you define the fields checked by the
system in searching for a valid free goods rate.
Note
• You group together all the free goods types that are to be taken into account by the system in
determining a free goods discount for a business transaction in a pricing procedure/calculation
schema. See "Define and Assign Free Goods Schemas").
Please note that only the free goods types contained in the free goods schema can be entered
manually.
• You can manually change the result found by free goods determination. You can limit the change
options possible for free goods in this menu.
SAP recommendation
• If you define your own free goods types and access sequences, the key should start with the letter Z,
since SAP keeps this name range free in the standard version.
• You should not change the free goods types and access sequences contained in the standard version
of R/3.
Actions
1. Check whether you can use the free goods types and access sequences contained in the standard
version of R/3.
2. To create new access sequences, copy a similar access sequnce and change it as desired. Enter
an alphanumerical key of up to 4 characters and a short text.
3. Maintain accesses for the access sequence by entering the free goods tables in the desired
sequence. The sequence defines the priority of the tables accessed. You can display the combinations
of key fields that have been defined via the F4 possible entries help.
4. You can create new free goods types by copying a similar free goods type and changing it. You
must make the following entries:
o Enter an alphanumerical key of up to 4 characters and a short text for the free goods type.
o Enter an access sequence for the free goods type.
5. Maintain the details screen for the free goods.

When free goods discounts are very similar, you can assign a reference free goods discount. Then all
you have to do is maintain free goods rates for the reference.
Accesses
Fields
Define Free Goods Types

In this step, you create new free goods types.
Recommendation
• If you define your own free goods types and access sequences, then the key should start with the
letter Z because SAP does not use this name range in the standard system.
• You should not change the access sequences and free goods types that are contained in the standard
SAP R/3 System.
Activities
1. Check to what extent you can use the free goods types and access sequences in the standard SAP
R/3 System.
2. Create new free goods types by copying a similar free goods type. You must specify the following:
o An alphanumeric key with a maximum of 4 characters for the discount-in-kind type and a
textual description.
o An access sequence for the free goods types.
3. Maintain the Detail screen for the free goods type.

In this case, if you have free goods types that are very similar, you can assign a reference free goods
type. You then only need to maintain free goods records for the reference free goods type.
Define And Assign Discount-in-Kind Schema

In this step, you define the free goods schemas. You also assign the free goods schemas to the transactions
by specifying the dependencies between the free goods schemas and:
• the purchasing organization schema group
• the vendor schema group

Maintain Free Goods Schema

In this step, you define a free goods schema.
In the free goods schema, you define which free goods types are to be taken into account and their sequence.
When determining the free-goods discount, the SAP System automatically determines which free-goods
schema is valid for a business transaction, and takes the types of free-goods contained in the schema into
account one after the other.
Recommendation
• If you define your own free goods schemas, then the key should start either with the letter Z or with the
number 9, because SAP does not use these name ranges in the standard system.
• You should not change the free goods schemas that are contained in the standard SAP R/3 System.
Actions
1. Check to what extent you can use the free goods schemas in the standard SAP R/3 System.
2. Create new free goods schemas by copying a similar free goods schemas.
o Enter a key which can have a maximum of 6 characters and a textual description for this.
o Specify the free goods types for a schema in the order that the are used.
o Maintain the lines of the free goods schemas.

Control Data
Determine Free Goods Schema

In this step, you set the determination of the free goods schema.
Activities
To determine the schema, you define the allowed combinations of:
• Schema group, purchasing organization
• Schema group, vendor
• Free goods schema

Select schema group supplier which we already created
Entre free goods schema

Go Back
Create a material for free goods allowed_MM01
Go to purchasing view
Qual.f.FreeGoodsDis _ Please see highlighted in black colour
Drill down
Select _ 2 Eligible for discount in kind only for purchasing
Create BP / supplier / vendor

Go to MM vendor
Tick mark “grant free goods”
Go more down in same screen

Schema Grp Supp: highlighted in black colour
Select schema group & save
Create purchse info record for material with same vendor , purchse
organization & plant _ME11
Puech org data 1

Entre desired information & save
Go to _ MBN1_ create free goods determination

Entre document type
An information box will apprear

Continue
Entre desire requirements

Entre min quantity for 100 items out of which which 10 items will be
free of cost. Meaning , if you will create PO for 100 items you have to
pay for 90 items & 10 items will be free.
Create PO _ME21N
Entre the same vendor
Entre Material , PO quantity, net price & plant

When you will entre storage location & 10 free items will appear in
line item 11
Standard PO created under the number 4500000196 created
MIGO_ carry out goods receive note_ Post it

Go to MMBE Display Stock overview

Execute
100 items “unrestricted use” will appear against plant SD00,Storage

location FG00 Finished Goods. It is giving 200 items as 100 items are
of some previous transaction
MIRO_ Logistic invoice posting

Post the invoice
So in this way in Logistic invoice posting only cost of 90 items will

populate & 10 items will be free of cast.
Thank You

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Document prepared by Mr Behram SAP MM & PM Master Trainer.

FREE GOODS IN SAP MM

Go over to FIORI Launchpad

Tile _Customizing Project Management

SAP Referance IMG

Define Price Determination Process net price or effective price

• After this, work through the following sections.

Define Schema Groups

In this step, you define schema groups.

(Note: calculation schemas may also be referred to as "pricing procedures".)

In this step, you can:

• Define schema groups for purchasing organizations and suppliers

• Assign schema groups to your purchasing organizations

Define Schema Groups for Suppliers

Discount in Kind (Discount in Form of Bonus Goods)

Maintain Access Sequence

o Enter an access sequence for the free goods type.

5. Maintain the details screen for the free goods.

Define Free Goods Types

o An access sequence for the free goods types.

3. Maintain the Detail screen for the free goods type.

Define And Assign Discount-in-Kind Schema

• the purchasing organization schema group

• the vendor schema group

Maintain Free Goods Schema

o Maintain the lines of the free goods schemas.

Determine Free Goods Schema

To determine the schema, you define the allowed combinations of:

• Schema group, purchasing organization

• Schema group, vendor

• Free goods schema

Select schema group supplier which we already created

Entre free goods schema

Select _ 2 Eligible for discount in kind only for purchasing

Create BP / supplier / vendor

Tick mark “grant free goods”

Go more down in same screen

Select schema group & save

Puech org data 1

Go to _ MBN1_ create free goods determination

Entre document type

An information box will apprear

Entre desire requirements

Entre the same vendor

Entre Material , PO quantity, net price & plant

Standard PO created under the number 4500000196 created

MIGO_ carry out goods receive note_ Post it

Go to MMBE Display Stock overview

100 items “unrestricted use” will appear against plant SD00,Storage

MIRO_ Logistic invoice posting

Post the invoice

So in this way in Logistic invoice posting only cost of 90 items will

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