I'm looking for exact definition in the subject of SD Organizational Structure.
I'm familiar with Sales Organization, but have problem with Distribution Channel and Division.
I understand, that Distr. Channel can represent the way of selling goods and products (e.g. Wholesale, Retal), but what is the purpose of using different Distr. Channles? Reporting? Configuration? I'm looking forward the exact advantages and disadvantages of using different Distribution Channels.
I also understand, that Divisions can be used to differentiate different product lines or product groups. Question is the same as before. I know some advantages of using different divisions (but in fact using different sales areas) in customer master data and restrictions, but not more.
I also looking for the answer, when to use Distribution Channel and when Division. An example: The company I'm working with sells services besides other materials. If I have a Wholesale Distr. Channel, where should I differentiate services. Should I create another Distr. Channel for Servies or just another Division? Whats are the pros and cons of choosing one or the another solution?
It would be nice to get precise answer for this questions, because at this time I could not get any, just generalities like different sales areas are good for reporting, authorizing and so on, but not exact use of them with pros and cons.
Thank you very much.
the standard definition is here:
short and clear ?
it is up to you how to set up the org. structure.
how we can provide "precise" answers if you didn't tell us what is your target
( are you building new sales reports? doing 1-2 level support? reviewing users authorizations ? .... )
distribution channel is used to differentiate the user tohave different prices and discounts....
for dealers u can give a product at 1000 k
for distributors it may be 900 k
and to differentiate different sales processes
like for export customers u can have a different d-channel,
for sto/intercompany u can have different d-chanel............etc
for reporting purpose also its very helpful.
division is used for reporting purpose as well as differentiating product line.
Thank you for your answer.
Regarding discounts, it is a good idea, but discount is usually based on contractual data in our case.
Could you describe what do you mean under "differentiate different sales processes". Based on this I understand that it can determine the subseqent document types, movement types and so on.
Thank you very much for your answer in advance.
Dear Mr. PPIO,
I'm familiar with the description you linked, but it doesn't answer my question. It doesn't describe why is it good if I define different distr. ch. instead of one.
Recently I'm setting up new SD Org. structure for a company with a team. You probably understand that I can't share company specific information, so I can't describe exact case.
But your question regarding "what is the target" gives me some information for my question of distr. channels, you mentioned sales reports, authorizations, and 1-2 level support (which I don't know what it means). These are the thing what the distr. channel controls, I assume. Can you mention any other that is controlled by distr. channel?
An example: The company I'm working with sells services besides other materials. If I have a Wholesale Distr. Channel, where should I differentiate services. Should I create another Distr. Channel for Servies or just another Division?
If you have created a material master record in SAP, a service e.g. RE-TV1 (description = repair of TV).
This can have only one division.
Thus your question of "just another division" would be possible if you create another MMR e.g. RE-TV2.
If "some characteristics" change for a particular way of selling (i.e. distribution channel) then create a new distribution channel and
- extend the MMRs
- extend / create the CMRs
- create the condition records
give the specific information (e.g. pricing, transportation group etc.)