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 Logistics, Commodity Pricing Engine in SD and MM

 

Technical Data

Technical Name of the Business Function

LOG_CPE_SD_MM

Type of Business Function

Enterprise Business Function

Available As Of

SAP enhancement package 3 for SAP ERP 6.0

Technical Usage

Central Applications

Application Component

CPE in SD (SD-BF-CPE)

CPE in MM (MM-PUR-GF-CPE)

Directly Dependent Business Function Requiring Activation in Addition

Not relevant

You can use this business function to calculate prices for commodities. Commodity pricing is a calculation that uses price quotations from the stock market (such as those published by Platts, Reuters, and others) to determine the price of a material or product. Commodity pricing is performed with the commodity pricing engine (CPE), based on a set of business rules that decide how price quotation data is used to get the final price for commodities. Commodity pricing contains different methods for determining price quotations, such as fixed price quotations, price quotations for a fixed day, or average price quotations.

The business information about how commodities can be priced is captured using formulas, known as commodity pricing formulas (CPE formulas). The price quotations are stored as master data and are used to evaluate these CPE formulas.

Prerequisites

You have installed the following components as of the version mentioned:

Type of Component

Component

Software Component

EA-APPL 603

SAP_APPL 603

To use commodity pricing in SD, you have made the necessary settings in Customizing for Sales and Distribution by choosing   Basic Functions  Commodity Pricing  .

To use commodity pricing in MM, you have made the necessary settings in Customizing for Materials Management by choosing   Purchasing  Commodity Pricing   .

Features

The following enhancements are available:

SD Documents

  • You can define CPE formula master data, which is valid for combinations of business attributes from Sales and Distribution (SD) (for example customer or customer/material). The system uses this master data to default CPE formulas in SD documents.

  • You can perform CPE formula evaluation locally in the ERP system, without using a SAP CRM system.

  • CPE formula simulation now includes simulation of the formula defaulting process.

MM Documents

  • CPE is integrated into MM documents (purchase contract, purchase order, goods receipt, and invoice verification).

  • You can define CPE formula master data, which is valid for combinations of business attributes from Materials Management (MM) (for example vendor or vendor/material). The system uses this master data to default CPE formulas in purchase orders.

  • You can maintain CPE formulas in purchase contracts. The system then copies the CPE formulas to contract release orders.

  • You can simulate a CPE formula for MM by using a formula from Customizing or from posted documents, or by simulating the formula defaulting process.

Trading Contract

  • CPE is integrated into the trading contract of the Enterprise Extension Global Trade (EA-GLTRADE). From a CPE point of view, the trading contract consists of an SD and MM part, which do not interact and behave like corresponding SD and MM documents.

  • If a partner solution with a commodity pricing function is integrated with the ERP system, it is possible to create CPE formulas together with the trading contract, using the service interface for the trading contract. In contrast to the normal scenario, in which CPE formula defaulting and formula evaluation takes place in the ERP system, in this scenario the formula defaulting and evaluation is suppressed. Up-to-date commodity pricing formulas have to be provided by the partner solution via the service interface for the trading contract.

    The scenario in which pricing evaluation takes place in the ERP system is generally referred to as SAP-based commodity pricing. The one in which the pricing evaluation takes place in the partner system and for which only the evaluated result is transferred to the ERP system, is called Partner-based commodity pricing.

CPE Formula

CPE supports the handling of flexible and specific price agreements, based on rules defined in the formulas for commodity pricing rather than on specific rates. You can maintain the formulas and their reusable parts (terms, rules, routines) in Customizing and use them in sales and purchasing documents as defaults or for manual maintenance. The condition types whose evaluation is based on CPE formulas have the calculation type Q.

CPE in SD and MM Documents

With the integration of CPE into SD and MM, you can determine the price of a commodity in all sales and purchasing documents, for which pricing is performed.

CPE generates default pricing formulas in these documents either from master data or from reference documents and evaluates the formulas to calculate prices for commodities. The result price is then transferred to the condition types, which are used in commodity pricing.

Commodity pricing is available for the following SD documents:

  • Inquiry

  • Quotation

  • Sales contract

  • Sales order

  • Invoice

Commodity pricing is available for the following MM documents:

  • Purchase contract

  • Purchase order

  • Goods receipt via purchase order history

  • Invoice verification

CPE offers a special function to enhance a pricing function within a document. The default document formulas and document item condition formulas in sales and purchasing documents are processed along with document condition data.

Formula Defaulting Using Condition Technique

You can maintain default values for CPE data in documents. There are two levels of default values, for document header and document item. The values at item level have a higher priority than at header level; the data from the header level is only copied to the item if there is no value at the item level.

The default values are stored with the use of the condition technique. So it is possible to define condition records with different key attributes such as sales organization, customer, or material in SD, and such as purchasing organization, vendor, or material in MM. By using access sequences, you can also define a priority of the condition records depending on the key attributes. You can also choose between defaulting whole CPE formulas from Customizing and defaulting several parts of the formulas independently.

CPE - Formula Maintenance

To maintain CPE formulas and to display the calculation results, you can use an additional button Formula Details in the condition screen both at item and header level of the document, for a condition type whose calculation type is Q.

If commodity pricing is enabled for SD, the pricing data of the condition type is calculated based on an underlying CPE formula in sales documents, for which pricing is performed.

If commodity pricing is enabled for MM, the pricing data of the condition type is calculated based on an underlying CPE formula in purchasing documents, for which pricing is performed.

More Information

For more information about pricing in general, see Commodity Pricing.

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