Sales Order Handling (Standard) (SAP Library

Sales Order Handling (Standard)

Purpose

Standard sales order handling concentrates on processing products that are sold directly from the warehouse. These are make-to-order products that are produced or procured on the basis of sales and profit planning. The products are ordered according to forecasts or levels of consumption, and are delivered directly from the warehouse to the customer. There is no direct link between sales orders and procurement. The lead time for the sales transaction is therefore relatively short, as a rule.

The relevant Quality Management processes in this scenario are described in detail in QM in Sales and Distribution.

You can find more information about different ways of creating make-to-order products or the final assembly of products under Sales Order Handling make/assembly-to-order

Prerequisites

The following R/3 components are integrated in standard sales order handling:

SAP Component	Functions
Sales	Sales quotations, orders, contracts and scheduling agreements
Credit and risk management	Credit limit checks, guarantees for open receivables
Shipping	Deliveries, goods issue
Warehouse Management	Stock placement and removal
Transportation	Transportation planning and processing
Billing	Invoice verification
Information system	Planning, forecasts, and statistics

Process Flow

Outline agreements

Long-term agreements about the receipt of products up to a certain a value or quantity are defined as contracts. You create individual sales orders from the customer‘s contract release order.

Scheduling agreements are used if the delivery dates, as well as the delivery quantities, are already known for an outline agreement.

Use for a sales order

You send the exact and binding product information (for example, prices, delivery dates) to the customer in the form of a quotation. A valid quotation that has been accepted by the customer can then be converted into a sales order.

A sales order is a short-term agreement for delivering products to a customer. The following functions are available:

Costing and pricing
Availability check
Delivery scheduling
Transfer of requirements to demand management
Credit limit check
Export control

Credit and risk management

In credit management you can run static or dynamic checks on credit limits at different stages in sales order processing (for example, in the order, the delivery or at goods issue).
Risk Management provides additional procedures for guaranteeing against credit risk, such as documentary payments, payment cards or export credit insurance.

Shipping

You trigger shipping processing by creating deliveries from orders that are due to be shipped. The system checks both the availability of the product and the validity of the shipping deadlines.

In picking, you remove goods from the warehouse and prepare them in the picking area. These functions are also supported by the Warehouse Management system.

Delivery items are packed by assigning shipping units that can be composed of materials and packing, or just the delivery item.

Goods issue represents the completion of shipping processing. It results in a reduction of stock and an update in the balance sheet account valuation in Financial Accounting (FI).

Warehouse Management

Picking links warehouse management (WM) with sales order processing. The system differentiates between picking in warehouses with fixed bin locations, or in warehouses with random storage (using transfer orders).

Transportation

You can use transportation planning to group together the deliveries that are due to be transported. Essential planning activities are determining shipping deadlines and means of transport, and assigning routes.
Transportation processing allows you to follow the transportation activities that take place after planning.

The shipment costs determined in transportation are forwarded to Financial Accounting, settled with the carrier and billed to the customer.

Billing

Invoices are created using deliveries for products, or orders for services. Billing plans are used for periodic or milestone billing. Once a billing document has been created, the values are posted to the relevant financial and cost accounting accounts.

Information system

The information system helps you in planning, forecasts, and analyses. It uses master data and any transaction data that may result from the business processes for its evaluations.

Result

The following scenarios can also be used in conjunction with standard sales order handling:

Presales Handling

Returnables/Empties Handling

Foreign Trade Handling

Complaints Handling