Saturday, June 4, 2011

Pricing

Pricing is used in SD to calculate the price of a product. Conditions indicates the different set of pricing elements such as Discounts, Freights, Taxes etc, which is either we need to add or subtract with the gross price to calculate the net price of the product.  In SAP we store all these conditions about pricing in condition records. System will determine these condition records automatically in the sales document using condition technique. While creating a condition record you can specify:

1)      Validity period,
2)      You can maintain conditions according to a scales
For Example:  Up-to 99 units the discount is 8%
                        From 100 to 499 units the discount is 12%
                        More than 500 units the discount is 15%...like that
3)      You can specify a lower as well as an upper limit for each condition record so that any manual changes in the sales document can be done only within these limits
4)      You can restrict the validity of the condition record for a sales area,
5)      Generally pricing is specific to the sales area, material and customer as per business need.
6)      Whether manual changes allowed or not?
Condition Type

Determines the category of a condition and describes how the condition is used. Condition type have all the control settings for creating a condition record such as: Scale basis, condition category, calculation type, text and some other relevant control settings. That mean condition type is the base of a condition record.
1)      Condition Category: It indicates whether the condition is a discount or surcharge. We can specify whether the resulting value of a condition type is a surcharge or a discount by using a plus/minus field in the condition types configuration.
2)      In condition type you can specify which scale base type should follow such as: Value of the product, weight, time, distance or Volume.
3)      You can also specify which calculation type should follow in a condition record by configuring condition type such as: percentage from an initial value, fixed amount, amount per unit of measure, amount per unit of weight, amount per unit of volume, amount per unit of time.
Condition Technique

System will determine condition in a sales document using the condition technique. The following is the path way in determining the condition record in a document.
1)      First we enter an item in a sales document
2)      Then depends up-on the Sales Area, Customer Pricing Procedure and Document Pricing Procedure the system will access the relevant Pricing procedure for processing the document.
(Pricing procedure determines which condition types and condition records have to be picked up and populated in a sales document)
3)      System read the condition type in the first step and determines the assigned access sequence for this condition type.
(The sequence in which the system accesses the condition type is defined in the pricing procedure)
4)      In this step system will
(Access sequence is the search strategy defines the sequence in which the system reads condition records of a condition type. Each access sequence will be having one or more access assigned to it. Access in the access sequence will be arranged as per their priority such as most specific to general. Each access is made using a condition table and these condition tables are used to define the structure of the keys of a condition record)
5)      The system searches for a valid condition record with the key specified by the condition table.
(System searches the access using the condition table, if it doesn’t find any valid record in the first search)
6)      When the system finds the valid condition record for an access, the system will reads the condition record and copies the value that corresponds to the scale into the sales document.
(The whole process is repeated for each condition type until the system has finished the entire pricing procedure.)

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