Org structure quiries - about sales org to plant assignment &shipping point

[Former Member]

Dear All,

My client is asking why the assignment of single sales organization with respect to all plants, why not separate sales organization for each plant?. But here we configured the single sales organization since a single sales department is there. How to convince the same to them effectively?

What is the significance of shipping point (to give an explanation to client) - my client is asking is shipping point is same as plant?

how do i convince them with the best possible answer

regards,

Archu

[Lakshmipathi · Accepted solution]

First of all you should understand the functionality of sales organisation. In SD, the top hierarchy is Sales Organisation as like Purchase Organisation for MM.

One sales organisation can have en number of sales office but not vice versa. Take an example of Reliance Group case.

Reliance is having various Divisions like Petroleum, Retail, Textiles, Telecommunications etc., and you can consider each as one sales organisation. For each of these sales organisations, you would be having different sales force and plants which you should assign under one sales organisation. So having said this, convince the customer that sales organisation should not be created per plant.

Next coming to shipping point

Yes you can treat the plant as shipping point also but imagine in the case of MNCs where if you have one shipping point per plant and different types of despatches take place like retail, OE, exports etc., you cannot have control over specific activity. Retail warehouse can generate for exports and exports can generate DA for OE which is logically wrong.

So in order to have a better control, you should have different shipping points so that you can have authorisation control based on user id.

thanks

G. Lakshmipathi

[jignesh_mehta3]

Hello,

To add to what the experts have said above,

Sales Organisation is basically a legally responsible line of Business. e.g. Dometic Sales & Export Sales, Retail Sales & Direct Sales, Petroluem & Chemicals sales...

Companies generally need seperate Sales Organizations provided the Sales Process is significantly different in two line of Business. As each plant of your client may produce same materials or materials belonging to similar business lines, there is no need for seperate Sales Organisation for each Plant.

Shipping Point: is a place from where are Goods are dispatched. Now you might have a scenario where you are shipping Milk Powder & Ice Creams. You can dispatch Milk Powder from normal shipping just as other materials. But for Ice Creams you need special Shipping Points which have refridgeration facilities. Also if you are shipping TV & Air Conditioners, here too you may need seperate Shipping Points. Also explain to your client that Shipping Point is mandatory in SAP. Even if your client business does not have concept of Shipping points, you will have to create one Shipping Point per Plant to process Deliveries & Good Issue.

Hope this clarifies...

Thanks,

Jignesh Mehta

[Former Member]

Hi Archana,

It is advised to have minimum number of Sales orgs in an org structure because to avoid the complications as well as confusion.For example if ur client has 10 plants,and imagine there are 3 or 4 divisions then if u create 10 sales orgs and also the distribution channels.Then there will be long list of Sales areas,and lot of confusion for the enduser.After all the enduser has to work on the system.It is better to keep the org structure as simple as possible.

Regards,

Ramesh.

[Former Member]

hi archana

My client is asking why the assignment of single sales organization with respect to all plants, why not separate sales organization for each plant?. But here we configured the single sales organization since a single sales department is there. How to convince the same to them effectively?

if you have more sales organisations,One distribution channel and three divisions. the no of sales ares willl be more

we have three sales organisations,One distribution channel and three divisions.

Nine sales ares we have

If you have more sales organizations then the master data will be more. so keeping sales organization to minimum will help to maintain master data easily

Possible reasons for having more than one sales organization for each company code:

· Different legal responsibilities, for example product liability

· Unusual stipulations (for example legal), which make it necessary to distribute different product lines separately u2013 for example, products for medicine and veterinary medicine

· The desire to separate completely the sales activities of different enterprise areas

Separate distribution responsibilities, each with their own Marketing and Pricing policy u2013 for example, one for the domestic market and one for export

Overlapping customer and product master records or the desire to maintain customer and product master data in a specific, unusual way

· Overlapping responsibilities for order entry, or for sales and distribution processing (sales authorizations)

[Former Member]

hi archana,

of course you can have it but it is not recommendable.

by assigning single sales organisation to single plant you can do it if you want, but the total business senerio is dependent on total enterprise structure after going live into SAP - right.

so we have to configure this ES to minnimal.

from reports perspective also we have to check.

shipping point:

the point from which delivery happens and even sales returns also will be taken automatically from the same shipping point which you have delivered the goods.

shipping point supports only delivery activities

plant supports : valuation of goods/acts as storage locaton/production activities/sales activities aslo

balajia