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SAP - R/3 Sales and Distribution

Pricing Procedure Determination in Sales and Distribution

SAP - R/3 Sales and Distribution

Pricing Configuration

Pricing Flow Chart


The diagram shows how the various elements in the condition technique work together.

Sales and Distribution Pricing


1.The system determines the pricing procedure according to information defined in the sales document type and the customer master record. 2.The pricing procedure defines the valid condition types and the sequence in which they appear in the sales order. 3.Each condition type in the pricing procedure can have an access sequence assigned to it. 4.In the example, the first access (searching for a customer-specific material price) is unsuccessful. The system moves on to the next access and finds a valid record. 5.The system determines the price according to information stored in the condition records.

How Condition Technique Elements Work

Condition Technique in Pricing

Pricing The term pricing is used broadly to describe the calculation of prices. Conditions Conditions represent a set of circumstances that apply when a price is calculated.

Condition Techniques It refers to the method by which the system determines prices from information stored in condition records. During sales order processing, the system uses the condition technique to determine a variety of important pricing information.

Condition Technique in Pricing


1. Create the Condition tables 2. Create the Access Sequences

3. Assign the Condition tables to the Access Sequences


4. Create the Condition types 5. Assign the Access Sequences to the Condition types 6. Create the Pricing Procedure and assign the Condition types to it 7. Determine the Pricing Procedure 8. Create the Condition record

Condition Table
A condition table defines the combination of fields (the key) that identifies an individual condition record. Example of a Condition Table: A condition records for customer-specific material prices is created. The standard R/3 System includes condition table 005 for this purpose. The key of table 005 includes the following fields: Sales organization Distribution channel Customer Material

Access Sequences
An access sequence is a search strategy that the system uses to find valid data for a particular condition type. It determines the sequence in which the system searches for condition record. The access sequence consists of one or more accesses.
In other word, It is the sequentially placing of condition tables in a logical order to obtain the valid condition record.

Assigning Ctables to Access Sequence


In this process we will assign the defined condition tables to the access sequences. It is the linking up the tables and access sequences. for Example, see the below screen short. The access sequences is PR00 and it has tables assigned like 005,006,004

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Condition Types
A condition type is a representation in the system of some aspect of your daily pricing activities. For example, we can define a different condition type for each kind of price, discount or surcharge, freight and taxes that occurs in your business transactions. Every condition type has its own access sequences, condition tables, and condition records

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Condition Type control fields

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Assigning A Sequences to Condition types

Access sequences will be assigned to the condition type to maintain the condition records. In practically speaking it is the link between the condition tables and condition types to get the condition records.

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Important control fields


The important control fields in condition type are 1. Condition class 2. Calculation type 3. Rounding rule 4. Header condition 5. Item condition 6. Validity Periods

7. Scales

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Important control fields


Condition Class Preliminary structuring of condition types e.g. In surcharges and discounts or prices. A grouping that lets you control each condition type differently.

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Important control fields


Calculation type Determines how the system calculates prices, discounts, or surcharges in a condition. For example, the system can calculate a price as a fixed amount or as a percentage based on quantity, volume, or weight.

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Important control fields


Rounding rule The rule that determines how the system rounds off condition values during pricing. The last digit will be rounded

Example:

Commercial: The amount in the sales order will be take has it is like Rs 500.58
Round up: If the amount in the sales order is Rs 500.58, it will be treated as Rs 500.60 Round down: If the amount in the sales order is Rs 500.58, it will be treated as Rs 500.50

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Important control fields


Header Condition Header conditions apply to all items in the document and are automatically distributed to the items. Automatic pricing does not take header conditions into account, we can not create condition records for them in the standard system. Header conditions are entered manually in order processing. R/3 includes the following header conditions Percent discount (HA00) Freight (HD00) Order value (HM00)

If this condition is marked as a header condition, it is possible to enter the condition type in the header condition screen
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Important control fields


Item Condition
In the standard system, most condition types are defined as item conditions. Examples of item conditions are: Material discount (K004) Customer/Material (K005) Customer discount (K007) Material price (PR01)

Mark this field if the conditions of this type are allowed to be entered in the document items. The condition is then only valid for the particular item in which it is entered.
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Important control fields


Validity Periods
Condition records for prices and discounts always include a validity period. The validity period is defined by a beginning date and an end date Valid from Date proposed as valid-from date Specifies the beginning validity date that the system automatically proposes when you create a rebate agreement of this type. Valid to Date proposed as valid-to date Proposed value for how long a condition should remain valid. The system proposes this value for the Valid to date when you create condition records

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Important control fields


Scales When you create a condition record for a pricing element, you can define a pricing scale. Scale Basis Determines how the system interprets a pricing scale in a condition. For example, the scale can be based on quantity, weight, or volume A pricing scale can be based on any of the following criteria Value Checking rule : Indicates whether the Quantity scale rates must be entered in Gross weight ascending or descending order Net weight Volume A formula specific to your requirements

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Maintaining Pricing Procedure


Pricing Procedure The primary job of a pricing procedure is to define a group of condition types in a particular sequence. The pricing procedure also determines: Which sub-totals appear during pricing Which method the system uses to calculate percentage discounts and surcharges Which requirements for a particular condition type must be fulfilled before the system takes the condition into account Pricing Procedures in the R/3 System The standard system contains pre-defined pricing procedures, which contain frequently used condition types along with their corresponding access sequences. We can, of course, modify these procedures or create your own from scratch

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Pricing Procedure control fields

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Pricing Procedure control fields

Step It is the number that determines the sequence of the conditions within a procedure.
Counter It is the sub step in the main step, or grouping of similar condition types. Condition Type The condition type is used for different functions. In pricing, in output determination, between different output types such as order confirmation or delivery note. From The reference step from to take the value of which is the basis for percentage surcharges.

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Pricing Procedure control fields


To The reference step to up to which the condition values of the previous steps are totalled. Percentage surcharges are calculated on the basis of the total. Manual Conditions, that are given this indicator in the pricing procedure, are only included in determination (price determination, output determination) either if they are entered manually, for example, on the condition overview screen in Pricing. Required or Mandatory Indicates whether the condition is mandatory when the system carries out pricing using this pricing procedure. Statistics This indicator causes a surcharge or discount to be set in the document statistically (that is, without altering the value.
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Pricing Procedure control fields


Print Controls issue of condition lines when printing documents such as order confirmations or invoices. Sub Total Controls whether and in which 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.

Requirement If the requirement is fulfilled (SY-SUBRC = 0), then output determination also takes into consideration output type or the access sequence, for which the requirement has been specified.
Calculation Type Condition formula for alternative calculation type alternative formula to the formula in the standard system that determines a condition.
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Pricing Procedure control fields


Condition Base Value Alternative formula for condition base value formula for determining the condition basis as an alternative to the standard. Accounting Key Key that identifies different types of G/L account. The account key enables the system to post amounts to certain types of revenue account or it is the link between FI and SD integration. Accruals With the aid of the account key, the system can post amounts to certain types of accruals accounts. For example, rebate accruals which are calculated from pricing conditions can be posted to the corresponding account for rebate accruals.

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Pricing Procedure Determination


The pricing procedure will be determine with the following key combinations Sales Area It is the combination of the external organization units, such as Sales organization, Distribution channel and Division Document Pricing Procedure The pricing procedure determines how the system carries out pricing for a particular sales document (for example, which pricing condition records it accesses and in which sequence) Customer Pricing Procedure Here you specify the pricing procedure for a customer. During sales order processing the pricing procedure determines the kinds of pricing element used and in which sequence they are processed. Pricing Procedure It determines which condition types can be used in a document and in which sequence they appear
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Pricing Procedure Determination


These three organization units are called as Sales area

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Creating the Condition record


Condition record Condition records allow you to store and retrieve pricing data in the system. All the pricing elements of your daily business - the prices, discounts, and surcharges for freight and taxes - that you want to use for automatic pricing must be stored in the system as condition records. During document processing, the system transfers data from the condition records and determines the amounts for individual pricing elements and the final amount for the sales document. Key combinations are the key fields of the condition tables

Creating the condition record with T-code VK11

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Creating the Condition record

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