Pricing Procedure
In the competitive landscape of sales and distribution, the ability to determine prices accurately and strategically is a cornerstone of business success. This powerful mechanism governs how prices are calculated throughout the sales process, ensuring consistency, transparency, and profitability. In this section, we’ll explore the structure and configuration of this vital component: the Pricing Procedure.
Concept of the pricing procedure:
At its core, the pricing procedure in SAP SD is a configurable set of rules that determines how the system calculates the final price of a product or service in a sales document. Think of it as a step-by-step guide that SAP follows, considering various factors like base prices, discounts, surcharges, and taxes. It's the engine that takes raw data and transforms it into the final price your customer sees.
Why is the indispensable?
Ensuring Price Accuracy: It guarantees that the correct prices, discounts, and surcharges are applied consistently across all relevant sales transactions.
Maintaining Standardization: By establishing a clear procedure, you enforce uniform pricing policies across different sales channels and customer segments.
Providing Flexibility: SAP's pricing procedure is highly adaptable, allowing you to model complex pricing scenarios, including tiered discounts, customer-specific pricing, and time-based promotions.
Automating Price Determination: Once configured, the system automatically calculates prices, reducing manual intervention and the potential for errors.
Transaction Codes:
Define Condition Table: V/03.
Define Access sequence: V/07.
Define Condition Type: V/06.
Define Condition Record: VK11.
Define Pricing procedure: V/08.
Assign pricing procedure to sales area: OVKK.
Configuration:
Setting up the pricing procedure in SAP SD involves a structured approach:
Condition technique consists of condition records.
Condition records will be stored in condition table.
Condition table will be placed in access sequence from most specific to most general.
Access sequence will be assigned to condition type.
Condition type will be placed in pricing procedure.
Step 1: Define Condition Table
“T-code: Create: V/03, Change: V/04, Display: V/05.”
Condition table is the combination of fields that will help to maintain the condition record. Combination: Customer/Material, Pricelist/Material, Material.
Click Create and select fields for your condition table (e.g., Sales Org, Customer, Material).
Save and note the table number (005 -> Sales org/Customer/Material).
Step 2: Define Access Sequences
“T-Code: V/07.”
It is a search strategy that will search for the valid condition record from the most specific to the most general. An access sequence defines how SAP searches for condition records in pricing.
Click New Entries and give a name and description, e.g., (ZACC: Access sequence).
Click on Accesses. Enter the sequence in which condition tables should be accessed and assign condition tables from Step 1.
Step 3: Define Condition Type
“T-Code: V/06.”
It controls the type of the price components, i.e., whether it is a base price, discount, surcharge, freight, or tax.
These are the standard condition types (PR00: Base price, K007: Customer discount, MWST: Tax, and KF00: Freight).
Click New Entries and enter the condition type (e.g., PR00 for base price, K007 for customer discount).
Assign access sequence from Step 2.
Define: Condition class (e.g., prices, discounts), Calculation type (percentage, fixed), and plus/minus indicator.
Manual entry allowed or not?
Save.
Step 4: Define Condition Record
“T-Code: Create – VK11, Change – VK12, Display – VK13.”
Condition record is the master data for pricing. We also call it “pricing master.”
Enter the condition type (e.g., PR00) and enter values for the key fields (from your condition table).
Save.
Step 5: Define Pricing Procedure
“T-Code: V/08.”
Click New Entries, enter the procedure name (e.g., ZPP01), click control data, and enter steps and counters (sequence of condition types).
Assign condition types with From/To (for subtotals or basis).
Requirement (optional—like document pricing condition).
Statistical (if for info only) and account key (for posting to accounts).
Step 6: Assign Pricing Procedure to Sales Area
“T-Code: OVKK.”
Define a combination of Sales Area + Document Pricing Procedure + Customer Pricing Procedure and assign your pricing procedure.
Benefits of the pricing procedure:
Enhanced Profitability: Accurate application of pricing rules and capture of all relevant charges directly contribute to improved revenue.
Increased Customer Satisfaction: Consistent and transparent pricing fosters trust and strengthens customer relationships.
Reduced Pricing Errors: Automation minimizes manual mistakes in price calculation, leading to more accurate invoices and fewer disputes.
Improved Operational Efficiency: Streamlined pricing processes free up valuable time and resources for your sales and finance teams.
Data-Driven Insights: A structured pricing procedure enables better analysis of pricing trends, profitability by customer or product, and the effectiveness of pricing strategies.
Challenges:
Complexity: Designing and implementing intricate pricing scenarios can be demanding and requires in-depth system knowledge.
Ongoing Maintenance: As your business strategies evolve, pricing rules may need adjustments, necessitating continuous maintenance of the pricing procedures and associated condition records.
Rigorous Testing: Thorough testing across various scenarios is essential to guarantee the accuracy and reliability of the configured pricing logic.
Data Integrity: The effectiveness of the pricing procedure relies heavily on accurate and up-to-date master data (e.g., customer master, material master).
Conclusion:
The pricing procedure in SAP SD is essential for strategic pricing. By understanding and configuring it effectively, businesses can enhance both profitability and customer satisfaction.
“Master the pricing procedure to stay ahead of the competition.
Leverage its power to drive smarter, more profitable sales decisions.”
