Product & pricing set up for consumer product in SAP

[Former Member]

Dear Expert,

I am trying to understand how a company dealing with multiple products set-up such structure in SAP

Let's say, we take Samsung Electronics as an example:

PRODUCT SET-UP:

Highest Level: Home & Business

Product within highest level: Mobile / Camera / PC Tablet

Sub Product Level for Mobile: Galaxy S4, Galaxy SIII, Galaxy Note etc

Likewise various product under Camera & PC Tablet

How above product structure is set-up in SAP and what is the SAP transaction code to enter product levels and structure? Also please suggest a report where I can see such product structure in SAP?

Considering finished stocks are maintained at cost price, where does different sales price shows for different customer of Samsung? What report we run to see this sale price maintained within SAP?

Example Customer of Samsung:

Direct Stores Customer: (Retail Price)

Direct On Line Customer:  (On line Retail price)

Distributors (Discount price to distributor / volume discount etc.)

Resellers (Discount price to resellers / volume discount etc.)

Will really appreciate your input towards understanding SAP Structure on above scenarios

Thanks & Regards,

[ajaycwa1981 · Accepted solution]

Hi Raj

1. Product hierarchy is used in material master to identify product line.

Divisions in SD are used to denote various product line. In FI, product lines are denoted by profit center

Eg* Home and business may be divisions in SD. PCs in fi can be kitchen app, mobiles, computers, consumer Elec etc

Mode of sale like online, direct stores are treated as distribution channel in sd

2. Pricing can be seen from SD condition record, vk13

Ajay M

[Former Member]

Hi Big Choi, Ajay,

Thanks once again for taking the time!

B,Rgds,

Raj

[Former Member]

Hi Ajay, Hrusikesh, Big Choi

Many thanks for the valuable input.

Big Choi: thanks for showing up the screen and it does really help. Just to reconfirm, in your example, Material 32850-1C001AA represent the lowest and 3rd level in the Hierarchy (1000010010-....)?

Thanks & Regards,

Raj

[Former Member]

Our example have 3rd level in the Hierarchy.

But you can define 4rd level or 5rd level in the Hierarchy.

Refer to below detail sap's description.

In this step, you define product hierarchies which you can use for
statistical analysis or pricing, for example, or you can change their structure.
The product hierarchy groups materials by combining different characteristics.
Each characteristic is represented by a specific product hierarchy level.

Example

A product hierarchy can be structured as follows:

Level Example Description

1 00001 Electrical appliances

2 00002 Household appliances

3 00000003 Wet appliances

In this example, a dishwasher belongs to product hierarchy
000010000200000003.

Standard settings

In the standard system, the product hierarchy consists of up to 3 levels. The
first and second levels have 5 digits and the third level has 8. The maximum
number of digits is 18 and the maximum number of levels is 9.

You can define hierarchy nodes at the individual levels of the product
hierarchy.

From the initial screen you can branch to the following steps:

• Product hierarchy structure

In the Data Dictionary, you can change the structure of the product

hierarchy (e.g. the number of levels).

• Data entry/display

Here you define the display of the product hierarchy and the format of the

accompanying text.

• Product hierarchy

Here you define your product hierarchies.

• Field catalog for pricing

Here you make fields of the product hierarchy structure available for use in

pricing.

• Field catalog for the Logistics Information System

Here you make fields of the product hierarchy structure available for use in

the Logistics Information System.

Actions concerning the product hierarchy structure

Structuring the product hierarchy

The product hierarchy can be structured via DDIC structure PRODHS. In the

standard system, a product hierarchy can be created with up to three levels. The

individual levels can contain the following number of digits:

Level number of allowed digits

1 5

2 5

3 8

This can be changed as of Release 3.0, where it is possible to extend the

maximum number of levels to 9.

If you want to change the standard setting of PRODHS, e.g. you want to change

the number of levels, proceed as follows:

1. Create an appropriate domain in the Data Dictionary (type CHAR with the

required length).

2. Assign these domains to the standard data elements PRODH1, PRODH2, ...,

PRODH9.

Please note that you should use these standard data elements.

3. Change the structure PRODHS by creating or deleting fields with reference

to the data elements.

Choose ZZPRODHN as field name, where n is the position of the field in the

structure PRODHS.

Example

You want to change the structure of the product hierarchy from 5/5/8 digits

to 5/5/5/3. Proceed as follows:

Create the following domains:

ZPRODH3 with length 5, category CHAR,

ZPRODH4 with length 3, category CHAR,

Change structure PRODHS:

• Strucutre PRODHS in the standard system:

Structure Fields Data element Category Length

PRODHS ->

PRODH1 PRODH1 CHAR 5

PRODH2 PRODH2 CHAR 5

PRODH3 PRODH3 CHAR 8

• Changes according to example:

Structure Fields Data element Category Length

PRODHS ->

PRODH1 PRODH1 CHAR 5

PRODH2 PRODH2 CHAR 5

PRODH3 PRODH3 CHAR 5

ZZPRODH4 PRODH4 CHAR 3

Note

The structure PRODHS and the data elements PRODH1, ..., PRODH9 are only
provided by SAP with Release 3.0 and can be changed by the customer from this
point onwards.

Conversion routines for INPUT/OUTPUT

The product hierarchy can be assigned to a conversion routine. The name of
the conversion routine is PRODH. The output template can be defined in
Customizing (see below).

The separators used in the template are not allowed for maintaining the
product hierarchy nodes.

Example:

If the template is _____/_____/__________

The symbol "/" cannot be used when maintaining the product hierarchy nodes.
In this case, the following entry would not be allowed:
123456/79012345678

Text concatenation

The description of a product hierarchy can be determined via concatenation,
if required.

Proceed as follows:

1. Determine the node preceding the current node

2. Concatenate the description of the subsequent node with the description

from the preceding node.

The text concatenation is valid for the entire product hierarchy, the
concatenated text has a length of 20. Text concatenation can be
activated/deactivated in Customizing (see below).

Note

Make sure during text concatenation that the text of the product hierarchy
does not come from table T179T. In this case function module
RV_PRODUKTHIERARCHIE_TEXT_GET is available.

Allowed symbols for product hierarchy nodes

If you have stored a template for the conversion routine, the separators in
the template are not allowed.

Actions concerning data entry/display

You can make two settings regarding the layout of the product hierarchy and
the format of the product hierarchy text:

1. Enter a template for displaying the product hierarchy. This template

defines the length of the individual levels and the separators.

Note that the character used to separate the levels in the template cannot

be used in the product hierarchy nodes.

2. The description of a product hierarchy node can be determined by

concatenation if required.

If you activate text concatenation, the text for one level is added to the

description of the higher level and then output. The text of the first level

appears at the beginning followed by the text of the second and third levels.

Text concatenation applies to the complete product hierarchy. The concatenated

text can have a maximum of 20 characters.

Do not activate text concatenation if you only want to issue the description

of the hierarchy levels created for these levels when the product hierarchy was

defined.

Actions concerning the product hierarchy

The product hierarchy can be freely defined and include up to three levels.
The SAP System checks the entry in the field product hierarchy during master
data maintenance and copies it to the SD
document. The separators used in the template cannot be used in the
product hierarchy.

Note

Via a matchcode you can search specifically for material master records with
a product hierarchy.

Analyze the product hierarchies in your organization and define their
representation in the SAP System.

1. Assign a characteristic value to the individual levels of your product

hierarchy: a 5-character value to levels 1 and 2, and an 8-character value to

level 3. The level number is determined automatically.

A product hierarchy node encompasses a characteristic value of a maximum of

18 characters.

2. Enter a description for the product hierarchy.

Actions concerning the field catalog for pricing

The product hierarchy can be used for functions in pricing. Then the fields
of the product hierarchy structure must be entered into the field catalog for
pricing.

Enter the fields of the product hierarchy in the field catalog.

Actions concerning the field catalog for Logistics
Controlling

The product hierarchy can be used for statistical analyses in the Logistics
Information System. The fields of the product hierarchy structure must then be
entered in a field catalog for the Logistics Information System.

Enter the product hierarchy in a field catalog. You can refer to field
catalog 'VPHI', which displays the standard settings.

[ajaycwa1981]

Hi Raj

Depending on no of levels in your product structure, you can extend prod hierarchy to 5 levels

I would place a greater emphasis on divisions and PC here. While prod hierarchy can be changed without much of impact, PC can't be setup that easily or changed easily

So, in such a scenario divisions, distribution channel and PC design is utmost important. Refer my 1st reply on how to do that, it gives  a glimpse

Ajay M

[Former Member]

Hi..

You can define the Product hierarchy of material master’s basic data 1 or Sales: Sales org. 2 view for your PRODUCT SET-UP.

You can analysis the profitability per your PRODUCT SET-UP  using t-code KE30 as below picture.

[former_member182339]

Raj,

1-To add what Ajay said yes you define the Product Hierarchy in Logistics see this thread

You can  Build COPA reports in KE30 for Product Hierarchy in SAP for analysing various aspects of profitability in SAP

2-T-code V/LD can be used to see various pricing reports. ( See some of SD thread discussions)

BR

Hrusikesh