distribution channel

[cathy_liang]

Hi experts,

There're 3 sales scenario: domestic sales (selling price including tax), direct export sales (selling price excluding tax) & indirect export sales. Due to special Customs policy, indirect export sales means that sales occuring in the special district excludes tax. However, the policy has strict management requirements for products. In that case, one customer located in the same country can have sales including tax or excluding tax.

The client requests to maintain material master more efficiently. Thus, he prefers less distribution channel.

Cosidering the client's request & the special Customs policy requirement, is it proper to define 2 distribution channels against one sales organization? One distribution channel is for domestic sales & direct export sales. The other is for indirect export sales.

If ok, any risk or bad impact?

Plz adivse. Thanks.

[Lakshmipathi · Accepted solution]

I feel only two distribution channels are enough in your case. One for domestic and another one for direct export and indirect export as well

With regard to material despatched with tax or without tax within the same country, you can very well change the tax classification for material in sale order and of course, for both the combination (with tax or without tax), you should maintain a separate tax code in VK11.

thanks

G. Lakshmipathi

[cathy_liang · Accepted solution]

Hi Lakshmipathi,

Great to hear from you.

Normally, the definition of distribution channel you advised is ok. However, the client is not willing to extend material master to another distribution channel. He considers it double work & too slow. His product is designed by his customers. Whithin 2 days, he has to sample, quote, create material master & arrange production.

If combing domestic sales & direct export sales into one distribution channel, material master is maintained once.

For indirect export sales, definition of separate distribution channel is just to meet Customs special requirements. In most projects here, direct export sales & indirect export sales does not combine into one distribution channel.

However, I doubt whether any risk or bad impact if combing combing domestic sales & direct export sales into one distribution channel.

Plz help further. Many thanks.

[Lakshmipathi · Accepted solution]

My guess was wrong and sorry for that.

Coming to the issue, Distribution Channel should always be one each for domestic and export and for indirect exports, you can use the distribution channel of exports.

The suggestion given by me earlier was under the impression based on your comments that one scenario is with tax and another one is without tax and I presumed that this was for local sales.

thanks

G. Lakshmipathi

[cathy_liang · Accepted solution]

Hi Lakshmipathi,

Do you mean 3 distribution channels should be be defined for those 3 sales separately? Or, one for domestic sales & indirect sales, the other for direct export sales?

May I know any risk or factors I should consider for the latter solution?

By the way, indirect export sales is to sell product to the special district within one country. It's kind of local sales or domestic sales. However, it's excluding tax.

[Lakshmipathi · Accepted solution]

It is upto you to decide based on the volume of indirect sales. If that is going to be huge, then I recommend to go for a separate distribution channel. If not, a different pricing procedure will suffice.

thanks

G. Lakshmipathi

[Former Member · Accepted solution]

Hi Cathy,

If the customer requirement is to open the material for one material or for one customer for one distribution channel and have it opened automatically for other distribution channels, please see if the possibility of common distribution channels suits you

SPRO -> Sales and Distribution -> Master Data -> Define Common Distribution Channels.

It means that if you have 3 DC (A, B and C) and you open to A (reference distribution channel), then materials and customers are created to B and C automatically and you can make sales orders directly to B and C.

See if this helps. Regards,