Prerequisites
To be able to use customers for customer hierarchies, you must have defined the following in Customizing for Sales and Distribution,
Process Flow
Depending on the function the customers have in the hierarchy and in order processing, create master records for Customer hierarchy nodes or for the sold-to party, payer and so on. You can find further information in
Creating Customer Master Records.In the customer master record you can indicate whether the customer is relevant for pricing, rebate processing, profitability analysis (CO-PA) or evaluations in the sales information system (SIS).
Normally the sold-to party or goods recipient are assigned to the lowest hierarchy level. You can, however, also assign a sold-to party to a node, that is at a higher level. For example, you could assign a particularly large branch of a chain of retail outlets to the regional office instead of to the local office.
Result
If you assign a customer in the hierarchy, the system creates a time-dependent assignment for this customer to the higher-level customer. When processing the customer hierarchy, you can change these assignments. You cannot change the customer master data. Changes in the customer master record are made in customer master record maintenance.
You can create special conditions or agreements for higher-level customers in the hierarchy. During order processing, the system takes into account automatically during pricing the current customer hierarchy and chooses the valid conditions.
Example
In the following example, the customer hierarchy represents the Smith nation-wide buying group. The central office - Smith Central - is defined as the top node in the hierarchy. T
h e regional offices for the buying group, Smith south, central and north east, are defined as nodes, whereby Smith north is a higher-level node to Smith central and Smith north east.Some nodes, for example, Smith north, are indicated as relevant for pricing, ie. conditions that are valid for them, are also valid for the customers assigned to them.
Customer hierarchy, organizational data and pricing relevance
See also:
Account groups in customer hierarchies