1. The Fulfillment Process

2. Introduction to Fulfillment
The fulfillment process involves
Creating customers
Creating sales orders
Receiving purchase orders from customers
Shipping orders
Sending and processing invoices
Processing payments
Managing credit

3. Organizational Units (SD Summary)
Global Bike
Client
Global Bike Inc.
Global Bike Germany GmbH
Company
Code
US West
US East
Germany North
Germany South
Sales
Organization
San Diego
Dallas
Miami
Hamburg
Heidelberg
Sales Office

4. Organizational Units (Company Code)
Smallest org unit for which you can maintain a legal set of books (financial accounting)
Global Bike has two company codes

5. Organizational Units (Company Code)
Table T001 contains the company code
A company has a currency (fields LAND1 WAER)

6. Organizational “grouping” Units
Divisions categorize what we sell (TSPA)
Distribution channels categorize how we sell what we sell (TVTW)

7. Organizational Units (Division)
A way of grouping materials, products, or services
SAP uses the division for logistics functions
Global bike has two divisions
Bicycles and accessories

8. Organizational Units (Division)
Table TSPA stores divisions
Divisions are create for the entire client
Various organizational units are assigned to divisions as you will see

9. Organizational Units (Distribution Channel)
This is the means by which goods are delivered to the customer
Wholesale, retail, online, are typical distribution channels
See Figure 5-3 Magal

10. Organizational Units (Distribution Channel)
Defined in table TVTW

11. Organizational Units (Sales Organization)
Responsible for sales and distribution of goods for a geographical area
A sales organization can sell through many distribution channels
We can restrict a sales organization to specific distribution channels

12. Organizational Units (Sales Organization)
Global Bike has the following sales organizations

13. Organizational Units (Sales Organization)
One sales organization can have many distribution channels or just one
Table TVKOV

14. Organizational Units (Sales Organization)
One sales organization can sell through many divisions
Table TVKOS

15. Organizational Units (Sales Area)
Combination of Sales Organization, Distribution Channel and Division
A sales area sells materials to customers through a distribution channel for a division of the company
Determines conditions (i.e. pricing) for sales activities
Much more later
Defined in table TVTA

16. Organizational Units (Sales Area)
Table TVTA

17. STATUS REPORT A company is organized into sales areas
Those sales areas sell materials to customers
A sales area is a unique combination of a sales organization, distribution channel, and division
Here we focus on the customer

18. Master Data (Customer)
Contains all information about a customer
Every customer must have a master record
Customer master data is divided into three areas
General data (table KNA1)
Company code / accounting (table KNB1)
Sales area (table KNVV)

19. Customer (General Data)
General data is defined at the client level (name, address, account number)
It applies to all company codes and sales areas
The other tables assign customers to sales areas and accounting areas

20. Customer (General Data)
Table KNA1 contains customer, address information, and global customer classification information

21. Customer (Company Data)
Mostly made up of accounting data (also called the accounting segment) for a particular company (US00) (DE00)
Payment terms
Company reconciliation accounts
It defines the rules by which the accounting department for the company must abide
Defined in table KNB1

22. Customer (Sales Area Data)
Combination of a sales organization, distribution channel and division
Describes HOW we sell materials to a customer

23. Customer (Sales Area Data)
The data relates to
Shipping, exchange currency, preferred delivery plant, delivery policies
If a customer is serviced by multiple sales areas, a separate sales area data must be maintained
Sales areas maintained in table KNVV

24. Customer (Sales Area Data)

25. Master Data (Customer)

26. STATUS REPORT A company is organized into sales areas
Those sales areas sell to customers
Materials are stored in plants
Customers buy materials from a sales area, which ships those materials from a plant

27. Organizational Units (Plant)
Plant from which the goods are produced and / or delivered
Global Bike has manufacturing and distributing plants

28. Organizational Units (Plant)
Table T001W stores the list of plants

29. Organizational Units (Other)
Other SD organization units:
Shipping Points are responsible for scheduling and processing deliveries to customers
Shipping points apply to plants
Loading Point
Think of a loading point as a loading dock at a warehouse
Sales Office
Sales Group
Sales Person

30. STATUS REPORT A company is organized into sales areas
Those sales areas sell to customers
Materials are stored in plants
Customers buy materials from a sales area, which ships those materials from a plant

31. Master Data (Material)
Remember that vendors sell us materials
These are the same materials discussed in the previous chapter
Trading goods
We make materials for resale too
Finished goods
Again, materials are stored and displayed in functional segments called views

32. Relevant Material Views (Sales 1)
Basic data
Sales organization data
Item category group defines the kind of item
Standard material / packaging
The delivering plant and responsible sales organization
Plant data
Describes how the material will be shipped
Loading methods

33. Relevant Material Views (Sales 2)
What if two plants distribute the same material?
There must be a unique material for every combination of
Sales organization
Distribution channel

34. The Fulfillment Process
Presales activities (these are optional)
Quotations
Outline agreements
Sales activity
Generate sales order
Shipping
Picking documents, delivery, goods issue
Payment

35. Pre-sales Activities Sales support and CRM Quotation
It’s our offer to the customer to supply selected products and at a specific price with specific delivery instructions

36. Sales Order
It’s a binding contract between our company and the customer
Created though
Internet orders
Existing contracts
Sales quotations (just discussed)

37. Sales Order (Contents)
Customer specific
Contains customer information, pricing, and material information
Order specific
Pricing
Shipping point
Material information
Delivery information
Credit limit check
MRP transfer

38. Sales Order (SAP)
As usual it contains a header, line items, and detailed schedule lines
Header – sales order information
Line Item(s) – product and quantity information
Schedule line – delivery and partial delivery information

39. Sales Order The sales document is made up of three primary areas:
Header
Data relevant for the entire sales order: Ex: customer data, total cost of the order
Line Item(s)
Information about the specific product: Ex: material and quantity, cost of an individual line
Schedule Line(s)
Uniquely belongs to a Line Item, contains delivery quantities and dates for partial deliveries

40. Delivery Scheduling Orders don’t necessarily ship immediately
We must often request a delivery date
This delivery date must be “possible”
The system helps perform the delivery scheduling
Scheduling is performed using backward and forward scheduling rules

41. Delivery Scheduling (types)
Backward
Work from the requested delivery date back to the order date
Forward
Work form the order today toward an expected deliver date

42. Shipping and Routing Information
Determines the shipping point for each line item (material)
An order can be shipped from multiple warehouses
The route determination is used to define the transit time from the shipping point to the destination

43. Availability Check
We can check the material availability considering inbound and outbound inventory movements
It’s possible to deliver partial orders
You – the company, define the rules

44. Order Pricing
Contains all pricing information for each specific material
Taxes and freight can be calculated automatically
Customers can have defined credit limits
SAP can be configured to block orders

45. Shipping (Deliver)
The process begins when the sales orders delivery documents are created
The process is make up of
Picking
Packing
Loading
Confirmation (post goods issue)

46. Picking Quantities based on delivery note
Assigned date when picking should begin
Automated storage location assignment
Supports serial number/lot number tracking and batch management
Integrated with Warehouse Management (WM)

47. Packing and Loading
Identifies and updates accounts associated with returnable packaging
Tracks the packed product by container
Insures weight/volume restrictions are enforced
All packed items are assigned to the required means of transportation

48. Shipping (steps) Generates packing proposal
Calculates weight and volume
Checks scheduling
Considers partial deliveries
Updates route assignment
Assigns picking location
Updates sales order
Determines batches
Quality check (if needed)

49. Goods Issue
It’s the change of ownership of our products from our company (Inventory) to their company
(FI) Goods are transferred from inventory to cost of goods sold
GL accounts are updated
The shipping process ends

50. Billing (Introduction)
The data is gathered from the sales order and delivery documents
SAP supports two types of billing
Order-based billing
Delivery-based billing
Outcome is the customer’s invoice
Credit status is updated

51. Billing Methods Delivery-based Collective-based Split invoicing
1 invoice per delivery
Collective-based
1 invoice for several deliveries
Split invoicing
Multiple invoices for one delivery

52. Billing Documents When posted,
Accounts receivable is debited
Revenue accounts are credited
The document is passed to financial accounting (FI) awaiting payment

53. Payment
Payment is the final step in the sales order process, this step is managed by the Financial Accounting department.
Final payment includes:
Posting payments against invoices.
Reconciling differences between payment and invoice.
Payment will create a posting clearing the liability in the A/R account and increases your bank account

54. Following the Document Flow