Configuring SAP ERP Sales and Distribution (Kapil Sharma, Ashutosh Mutsaddi)（Z-Library）

SERIOUS SKILLS. Confi guring SAP ® ERP Sales and Distribution C o n fi g u rin g S A P ® E R P S ales and D istrib ution K A P I L S H A R M A A N D A S H U TO S H M U TS A D D ICONFIGURING SAP® ERP SALES AND DISTRIBUTION Your step-by-step guide to confi guring SAP’s SD module S H A R M A M U T S A D D I This practical guide is your key to confi guring the Sales and Distribution submodules, including Master Data, Pricing, Sales, Billing, Shipping, Transportation, and more. Follow step-by-step instructions and real-world examples for common and advanced SD confi gurations for SAP ECC 6.0. You’ll fi nd out how to set up an effi cient system and meet your business needs. Kapil Sharma has more than eight years of experience with SAP and has performed localization projects for China, Mexico, Canada, the U.S., and Europe. He is an expert in business process analysis, confi guration, imple- mentation, and change management, and he specializes in sales and operation planning and channel partners management. Ashutosh Mutsaddi, a senior SAP solutions consultant and a certifi ed project manager, has 10 years of experience in design and implementation of SAP solutions. During his career, he has offered consultancy to several Fortune 100 companies in Europe, North America and Asia. Profi cient in process re-engineering, business blueprinting, system confi guration and upgrade, he has worked on all major SAP versions - from 3.1I to ECC 6.0. • Explore a sales cycle from start to fi nish and examine the transaction codes at every step • Defi ne an enterprise structure according to your organization’s sales requirements • Understand cross-organizational elements and how to link them to the SD module • See how to access and use your company’s master data in the SD module • Confi gure all functions, including pricing, tax determination, product availability, billing, shipping, and others • Manage account assignment and revenue recognition • Get up to speed on advanced techniques and best practices • Find a complete list of useful transaction codes ISBN 978-0-470-40473-7 $79.99 US $95.99 CAN COMPUTERS/Data Processing

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Configuring SAP® ERP Sales and Distribution Kapil Sharma Ashutosh Mutsaddi 404737ffirs.indd 1 2/23/10 12:13:12 PM

Acquisitions Editor: Agatha Kim Development Editor: Laurene Sorensen Technical Editor: Dheeraj Oswal Production Editor: Liz Britten Copy Editor: Kim Wimpsett Editorial Manager: Pete Gaughan Production Manager: Tim Tate Vice President and Executive Group Publisher: Richard Swadley Vice President and Publisher: Neil Edde Book Designer: Franz Baumhackl Compositor: Craig Johnson, Happenstance Type-O-Rama Proofreader: Word One, New York Indexer: Ted Laux Project Coordinator, Cover: Lynsey Stanford Cover Designer: Ryan Sneed Copyright © 2010 by Wiley Publishing, Inc., Indianapolis, Indiana Published simultaneously in Canada ISBN: 978-0-470-40473-7 No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except as permitted under Sections 107 or 108 of the 1976 United States Copyright Act, with- out either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permissions. Limit of Liability/Disclaimer of Warranty: The publisher and the author make no representations or warranties with respect to the accuracy or completeness of the contents of this work and specifically disclaim all warranties, including without limitation warranties of fitness for a par- ticular purpose. No warranty may be created or extended by sales or promotional materials. The advice and strategies contained herein may not be suitable for every situation. This work is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional services. If professional assistance is required, the services of a competent professional person should be sought. Neither the publisher nor the author shall be liable for damages arising herefrom. The fact that an organization or Web site is referred to in this work as a citation and/or a potential source of further information does not mean that the author or the publisher endorses the information the organi- zation or Web site may provide or recommendations it may make. Further, readers should be aware that Internet Web sites listed in this work may have changed or disappeared between when this work was written and when it is read. For general information on our other products and services or to obtain technical support, please contact our Customer Care Department within the U.S. at (877) 762-2974, outside the U.S. at (317) 572-3993 or fax (317) 572-4002. Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may not be available in electronic books. Library of Congress Cataloging-in-Publication Data Sharma, Kapil, 1975- Configuring SAP ERP sales and distribution / Kapil Sharma, Ashutosh Mutsaddi. — 1st ed. p. cm. ISBN-13: 978-0-470-40473-7 (cloth) ISBN-10: 0-470-40473-6 1. SAP R/3. 2. Sales management—Computer programs. 3. Marketing—Management—Computer programs. 4. Physical distribution of goods—Management—Computer programs. I. Mutsaddi, Ashutosh, 1974- II. Title. HF5438.35S53 2010 658.800285’53—dc22 2009052156 TRADEMARKS: Wiley, the Wiley logo, and the Sybex logo are trademarks or registered trademarks of John Wiley & Sons, Inc. and/or its affiliates, in the United States and other countries, and may not be used without written permission. SAP is a registered trademark of SAP AG in Germany and in several other countries. All other trademarks are the property of their respective owners. Wiley Publishing, Inc. is not associated with any product or vendor mentioned in this book. 10 9 8 7 6 5 4 3 2 1 404737ffirs.indd 2 2/23/10 12:13:12 PM

Dear Reader, Thank you for choosing Configuring SAP ERP Sales and Distribution. This book is part of a family of premium-quality Sybex books, all of which are written by out- standing authors who combine practical experience with a gift for teaching. Sybex was founded in 1976. More than 30 years later, we’re still committed to pro- ducing consistently exceptional books. With each of our titles, we’re working hard to set a new standard for the industry. From the paper we print on, to the authors we work with, our goal is to bring you the best books available. I hope you see all that reflected in these pages. I’d be very interested to hear your comments and get your feedback on how we’re doing. Feel free to let me know what you think about this or any other Sybex book by sending me an email at nedde@wiley.com. If you think you’ve found a technical error in this book, please visit http://sybex.custhelp.com. Customer feedback is critical to our efforts at Sybex. Best regards, Neil Edde Vice President and Publisher Sybex, an Imprint of Wiley 404737ffirs.indd 3 2/23/10 12:13:12 PM

I dedicate this book to my grandmother and parents, because what I am today is due to their teachings and blessings, and to my wife Shweta, for all her support and encouragement, without which I could have never completed this book. —Kapil Sharma I would like to dedicate this book to my family—my son Atharva who understood that Daddy could not spend time with him due to the book deadlines, my wife Dipashri for her love and support, and my parents for who I am today. Thank you all for being with me throughout this (ad)venture! —Ashutosh Mutsaddi 404737ffirs.indd 4 2/23/10 12:13:12 PM

A c k n o w l e d g m e n t s W e are grateful to the divine Universe for providing the inspiration for this book! We would like to acknowledge the help and support received from our colleagues and the management of Intelligroup Inc. during the writing of this book. The opportunity to work on challenging projects over the years has helped us hone our technical skills and enabled us to write this book. We thank Agatha Kim, our acquisitions editor, for her tremendous help at every stage. Special thanks to Dheeraj Oswal, our technical editor, and to the entire edito- rial and production teams for their suggestions and input. Kapil Sharma and Ashutosh Mutsaddi 404737ffirs.indd 5 2/23/10 12:13:12 PM

A b o u t t h e A u t h o r s Kapil Sharma has more than eight years of experience in SAP. During this time, he has played various roles ranging from solution architect to project manager, and he has managed various projects involving full lifecycle implementations, production support, rollouts, upgrades, enhancements, acquisition and mergers, and process improvements in various industries such as consumer goods, retail, education, telecom and services, and high tech. He is an expert in business process analysis, configuration, implementation, and change management. Ashutosh Mutsaddi is a senior SAP solutions consultant and a certified project man- ager. He has 10 years of experience in the design and implementation of SAP solu- tions. During his career, he has been a consultant to several Fortune 100 companies in Europe, North America, and Asia. He has diverse experience spanning industries such as high tech, automotive, electrical, media, and retail. Proficient in process reengineer- ing, business blueprinting, and system configuration and upgrade, he has worked on all major SAP versions, from 3.1I to ECC 6.0. Besides consulting, he also fills a variety of strategic and leadership roles. As a senior project manager, he manages large teams and delivers cutting-edge SAP solutions to customers worldwide. 404737ffirs.indd 6 2/23/10 12:13:12 PM

c o n t e n t s At A g l A n c e Introduction xv Chapter 1 Introduction to Sales and Distribution 1 Chapter 2 Enterprise Structure 27 Chapter 3 Master Data in SD 69 Chapter 4 Partner, Text, and Output Determination 103 Chapter 5 Pricing and Tax Determination 155 Chapter 6 Availability Check, Transfer of Requirements, and Backorders 207 Chapter 7 Sales 247 Chapter 8 Shipping and Transportation 323 Chapter 9 Billing 371 Chapter 10 Account Assignment and Revenue Recognition 429 Chapter 11 Credit Management 453 Chapter 12 Material Determination, Listing, Exclusion, and Proposal 483 Chapter 13 Serial Numbers and Batch Management 519 Chapter 14 Advanced Techniques 551 Appendix Transaction Codes and Database Tables 597 Index 625 404737ffirs.indd 7 2/23/10 12:13:12 PM

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T a b l e o f C o n T e n T s Introduction xv Chapter 1 Introduction to Sales and Distribution 1 Introduction to SAP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 First Steps in SAP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Easy Access Menu . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 The Customizing Menu . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 The Basic Sales Cycle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Getting Help . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Database Tables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Data Browser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 ABAP Dictionary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21 Managing Customization Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 The System Landscape . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22 Transport Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25 Chapter 2 Enterprise Structure 27 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28 Setting Up the Enterprise Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29 Setting Up the Sales Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30 Defining a Sales Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Defining a Sales Organization Using the Copy Method . . . . . . . . . . . . . . . . . . . . . . . . . . .35 Assigning a Sales Organization to a Company Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37 Configuring a Distribution Channel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39 Defining a Distribution Channel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40 Assigning a Distribution Channel to a Sales Organization . . . . . . . . . . . . . . . . . . . . . . . . . 41 Configuring a Division . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Defining a Division . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43 Assigning a Division to a Sales Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44 Setting Up a Sales Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45 Defining a Common Distribution Channel and Common Division . . . . . . . . . . . . . . . . . . . . .47 Setting Up a Sales Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48 Setting Up a Sales Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51 Configuring Plants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53 Assigning the Sales Organization and Distribution Channels to Plants . . . . . . . . . . . . .54 Setting Up a Storage Location . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56 Setting Up a Shipping Point . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .58 Setting Up a Transportation Planning Point . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .62 404737ftoc.indd 9 2/23/10 12:13:46 PM

x T a b l e o f c o n T e n T s Setting Up a Factory Calendar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .63 Running a Consistency Check . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67 Chapter 3 Master Data in SD 69 Customer Master . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .70 Common Terms in Customer Master Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71 Creating Customer Master Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72 Maintaining Customer Master Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .75 Customizing Customer Master Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .76 Customer Hierarchy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .85 Creating a Customer Hierarchy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .85 Customizing a Customer Hierarchy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88 Material Master . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .91 Common Terms in Material Master Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .91 Creating Material Master Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .91 Maintaining Material Master Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .96 Customizing Material Master Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .97 Product Hierarchy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .99 Maintaining a Product Hierarchy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .100 Customizing a Product Hierarchy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .100 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .101 Chapter 4 Partner, Text, and Output Determination 103 Partner Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .104 Deciding the Scope of Customization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105 Customizing Partner Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .107 Text Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 Maintaining Text in Customer Master Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .120 Setting Up Text Determination in SD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121 Output Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .133 Deciding the Scope of Customization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .134 Setting Up Output Determination for Sales Documents . . . . . . . . . . . . . . . . . . . . . . . . .135 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .153 Chapter 5 Pricing and Tax Determination 155 Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .156 Deciding the Scope of Customization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .158 Configure Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .159 Maintaining Price Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .181 Other Key Settings in Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .183 Pricing Scenarios and Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .189 Tax Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .198 Setting Up the Tax Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .199 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206 404737ftoc.indd 10 2/23/10 12:13:46 PM

T a b l e o f c o n T e n T s x i Chapter 6 Availability Check, Transfer of Requirements, and Backorders 207 Meaning and Relationship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 208 Types of Availability Check . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 209 How the Availability Check Process Works . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 211 Customizing the Availability Check and Transfer of Requirements . . . . . . . . . . . . . . . . . . .216 Step 1: Activate Transfer of Requirements and Availability Check at Requirement Class Level . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217 Step 2: Define Requirement Type and Assign a Requirement Class to a Requirement Type . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .218 Step 3: Set Up Determination Rule for TOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .219 Step 4: Activate Transfer of Requirement and Availability Check at Schedule Line Category Level . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .221 Step 5: Define Checking Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 222 Step 6: Define Scope of Availability Check . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .226 Further Fine-Tuning in Customizing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228 Working with the Availability Check . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .235 Availability Check in Sales Order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 236 Availability Check in Shipping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .240 Backorder Processing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .240 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .246 Chapter 7 Sales 247 Sales Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .248 Structure of a Sales Document . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .249 Origin of Data in a Sales Document . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250 Customizing Sales Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .251 Defining Sales Document Types . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .251 Defining Item Categories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 264 Setting Up an Item Category Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .271 Defining Schedule Line Categories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .274 Setting Up a Schedule Line Category Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . .276 Setting Up Copy Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .277 Common Sales Document Customizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 284 Allowable Sales Doc by Sales Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 284 Converting the Language for Each Sales Document Type . . . . . . . . . . . . . . . . . . . . . . . .287 Defining Purchase Order Types . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .287 Maintaining Order Reasons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 288 Customizing Order Blocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .289 Reasons for Item Rejections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 290 Incompletion Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .291 Delivery Blocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 298 404737ftoc.indd 11 2/23/10 12:13:47 PM

x i i T a b l e o f c o n T e n T s Types of Sales Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300 Inquiries and Quotations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300 Sales Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .302 Debit and Credit Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .302 Invoice Corrections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .303 Free-of-Charge Delivery and Subsequent Free-of-Charge Delivery . . . . . . . . . . . . . . 304 Cash Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .305 Rush Orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .307 Consignment Processing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 308 Third-Party Order Processing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 309 Sales Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 312 Common Customizations in Sales Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 315 Quantity Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .319 Service and Maintenance Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .320 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .322 Chapter 8 Shipping and Transportation 323 The Shipping Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .324 Delivery Creation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .325 Picking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .338 Packing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .343 Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .350 Maintaining Routes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .351 The Shipment Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 360 Goods Issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 368 System Modifications in Deliveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .369 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .370 Chapter 9 Billing 371 Billing Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .372 Billing Document Creation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .372 Some Important Billing Types . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .374 Customizing Billing Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .377 Billing Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394 Billing Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .395 Rebates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 403 The Rebate Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 403 Rebate Configuration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 408 Payment Card Interface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .416 The Payment Card Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 417 Payment Card Configuration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 419 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .427 404737ftoc.indd 12 2/23/10 12:13:47 PM

T a b l e o f c o n T e n T s x i i i Chapter 10 Account Assignment and Revenue Recognition 429 Account Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .430 Set Up Account Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .430 Revenue Recognition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440 Revenue Recognition Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .441 Set Up Revenue Recognition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .451 Chapter 11 Credit Management 453 Introducing Credit Management in SAP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .454 Setting Up Credit Masters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .456 Processing the Credit-Blocked Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .457 Customizing Credit Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 460 Defining a Credit Control Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 460 Assigning the Credit Control Area to a Company Code and Sales Area . . . . . . . . . . . . 463 Defining a Permitted Credit Control Area for a Company Code . . . . . . . . . . . . . . . . . . 466 Defining Risk Categories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 466 Defining Credit Groups . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 468 Assigning Credit Groups to Sales Documents and Delivery Documents . . . . . . . . . . 469 Determining Active Receivables per Item Category . . . . . . . . . . . . . . . . . . . . . . . . . . . . .470 Setting Up Credit Checks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .471 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .481 Chapter 12 Material Determination, Listing, Exclusion, and Proposal 483 Material Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 484 Maintaining Material Determination Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 485 Deciding the Scope of Customization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 488 Customizing the Material Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 489 Automatic Product Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 496 Material Listing and Exclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 496 Customizing the Material Listing/Exclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .498 Handling the Material Listing/Exclusion in Deliveries . . . . . . . . . . . . . . . . . . . . . . . . . . .503 Maintaining the Material Listing Master Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 504 Customer–Material Info Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .505 Creating the Customer–Material Info Record . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .505 Creating Orders Using the Customer Material Number . . . . . . . . . . . . . . . . . . . . . . . . . 509 Dependencies Between Material Functionalities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .510 Item Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .510 Creating an Item Proposal Record . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .512 Seeing Item Proposals in Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .514 Seeing Customer-Specific Item Proposals in Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . .515 Customizing an Item Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .516 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 517 404737ftoc.indd 13 2/23/10 12:13:47 PM

x i v T a b l e o f c o n T e n T s Chapter 13 Serial Numbers and Batch Management 519 Serial Numbers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .520 Controlling Serial Number Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .521 Customizing Serial Number Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .523 Maintaining Serial Numbers Master Record . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .526 Batch Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .529 Understanding Batch Levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .530 Maintaining Batch Master Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .532 Customizing Batch Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .536 Preliminary Setup and Activation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .536 Batch Number Ranges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .538 Batch Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .539 Batch Determination in Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 546 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .550 Chapter 14 Advanced Techniques 551 Enhancement Packages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .552 Introduction to Enhancement Packages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .552 Implementation Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .553 Switch Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .554 Important Tools and Techniques . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .557 QuickViewer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .557 SAP Query . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .562 Mass Maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .570 Logistics Information System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .576 EDI/ALE/IDoc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 588 Custom Enhancements in SAP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .592 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .595 Transaction Codes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .598 Database Tables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .619 Recommended Web Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .624 Appendix Transaction Codes and Database Tables 597 Index 625 404737ftoc.indd 14 2/23/10 12:13:47 PM

I n t r o d u c t I o n T his book provides a deep, working understanding of the essential concepts and cus- tomization settings related to the SAP Sales and Distribution (SD) application. SD is one of the most popular modules of the SAP ERP software and indeed the most interesting one to implement. Over the years, we have worked on a variety of projects ranging from global imple- mentation, support, upgrades, acquisition and mergers, rollouts, and integration. We’ve had the opportunity to study the business requirements of different indus- tries and the best practices in customizing SAP to meet different challenges. Our goal was to bring the knowledge that we acquired during those projects to you through this book. Who Should Read This Book As the title implies, this book is intended for people who want to learn how to con- figure the SAP Sales and Distribution application. Whether you are a beginner who wants to make career in SAP as a SAP SD consultant, a business analyst from the IT/IS extended team of your organization, a member of the project implementation team responsible for implementing SD, a production support team member respon- sible for supporting the Sales and Distribution module after implementation, an experienced consultant from another SAP module who wants to learn SAP SD, or an experienced SAP SD consultant who wants to learn what’s new in ECC 6 or how to handle some other functionality, you will find valuable information in this book related to customizing SAP SD. If you are new to SAP, the learning curve can be steep. In this book, we tried to reduce that learning curve by providing easy-to-follow step-by-step instructions and case studies from a fictitious company called Galaxy Musical Instruments Inc. 404737flast.indd 15 2/23/10 12:14:13 PM

x v i i n t r o d u c t i o n How This Book Is Organized You can use this book in several ways. The most straightforward way is to start at the beginning and proceed chapter by chapter. We have logically ordered the chap- ters according to the processes in a standard sales cycle. Each topic covers the pre- requisite configurations before discussing how to configure a new submodule. We start with the basic concepts and travel all the way through to some very advanced configuration topics and techniques by the end of the book. If you already have con- figuration experience, you can skip around from chapter to chapter and follow the step-by-step instructions for a topic of interest in its individual chapter. How Is This Book Different? This book is different from others on the market in the following ways: The book covers the functionality offered by SAP in the latest version: ECC 6.0. f It provides an overview of enhancement packages, which are the SAP road f maps for delivering innovations in the coming years. It illustrates all the concepts with a real-life case study that runs through all f the chapters of the book. This provides a cohesive picture of how a real-life organization can leverage SD to meet its requirements. It contains important tips, useful notes, and helpful links to other resources, f such as SAP Service Marketplace (OSS) notes, where applicable. What’s Inside Here is a glance at what’s in each chapter: Chapter 1: Introduction to Sales and Distribution Gives you a brief overview of the SAP SD application and familiarizes you with the bare-minimum basics that you need to know before you step up to the next chapters. Chapter 2: Enterprise Structure Brings you to the customization world and provides easy-to-follow step-by-step instructions to help you set up your own SAP 404737flast.indd 16 2/23/10 12:14:13 PM

i n t r o d u c t i o n x v i i SD enterprise structure. To demonstrate the customization, we’ll set up the enter- prise structure using the business requirement example from our fictitious com- pany, Galaxy Musical Instruments. Chapter 3: Master Data in SD Introduces you to master data setup. Master data plays a key role in the core operation of a business. It may include data about clients and customers, employees, suppliers, products, and so on. Chapter 3 will teach you about how to set up and customize the master data in SAP SD. Chapter 4: Partner, Text, and Output Determination Takes your learning to the next level. You’ll learn about the role of partners, output, and text determination in the overall sales cycle, followed by how to customize the same to meet your busi- ness requirement. Chapter 5: Pricing and Tax Determination Introduces you to the pricing and tax determination world. Here you’ll learn about various pricing elements and will configure them to determine the final price at which the sales transaction can take place. Chapter 6: Availability Check, Transfer of Requirements, and Backorders Covers the available-to-promise functionality in detail. Promising accurate and reliable dates for delivery to your customers is a key element of the order fulfillment process in today’s competitive environment, and this chapter talks about all the things you need to know in order to customize your SAP SD application to provide this reliability. Chapter 7: Sales Covers the customization and sales cycle flow for a variety of sales documents types that are available in standard SAP. You will learn about con- tracts, standard orders, third-party orders, debit/credit notes, consignments, warranty and maintenance contracts, quantity contracts, and so on. Chapter 8: Shipping and Transportation Covers shipping- and transportation- related activities in detail. This chapter covers topics such as delivery documents, routing, picking, packing, transportation, transfer orders, and shipment documents. Chapter 9: Billing Covers customer invoicing-related topics such as billing pro- cess, milestone billing, periodic billing, invoice lists, rebates, debit/credit notes, and payment card setup in SAP SD. Chapter 10: Account Assignment and Revenue Recognition Covers GL account determination for account posting of the invoice document. We’ll also cover revenue recognition functionality in this chapter. 404737flast.indd 17 2/23/10 12:14:13 PM

x v i i i i n t r o d u c t i o n Chapter 11: Credit Management Covers credit management in SAP SD in detail. Chapter 12: Material Determination, Listing, Exclusion, and Proposal Talks about various material-related functionalities in detail. This includes topic such as material determination, automatic product proposal, customer–material info records, and so on. Chapter 13: Serial Numbers and Batch Management Covers the serial num- ber and batch management topics in detail. Chapter 14: Advanced Techniques Talks about various technical topics such as user exits, BAPI, EDI, IDOCS, and ABAP queries. This chapter also covers switch framework and enhancement packs in detail. The appendix at the end of the book contains valuable information about transac- tion codes, database tables, and recommended web resources for further learning. All through this book, we will use a case study of a fictitious company called Galaxy Musical Instruments; it’s a trading organization that deals in musical instruments as well as related media and accessories, with operations in the United States and Mexico. This end-to-end case study will ensure continuity and help you understand how an organization can put SD’s functionalities to use. Here is the organization structure for Galaxy Musical Instruments. Galaxy (United States) Galaxy U.S. Los Angeles Distribution Center Retail Direct Sale Galaxy Musical Instruments Instruments and Accessories Media and Apparel Galaxy (Mexico) Galaxy Mexico Baja California Distribution Center Retail Instruments and Accessories 404737flast.indd 18 2/23/10 12:14:14 PM