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Product Hierarchy

Former Member
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Hi,

Whats the significance of Product Hierarchy, how is that applied in an SAP implementation ? Whats the role of Product Hierarchy in SAP R/3 SD?

NOTE : Pls do not copy paste notes from SAP HELP, as i`ve done my work on that. All i would like to understand is about a real example.

Rgds

Accepted Solutions (1)

Accepted Solutions (1)

Former Member
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i think when you have already gone through SAP Help then i should straightaway give a example.

Say you have a lot of varieties of semi finished goods, from which you can make a number of type of finished goods according to your customer's requirement & accordingly your pricing will be different based on the type of semi finished used in making.

Say you are providing a IP-VPN service along with hardware also so when pdt hrchy will be set then there will be preceeding nodes which will make the total service/pdt combination. ex IP-VPN managed 250 Mbps with 2 juniper routers & security of that network through firwall. so in this case you have the preeding nodes set for all the products & services & when finally your Pdt/Service combination will show up in the SO it will be give the price & description of features accordingly, so making your job easy to to.

you can have upto 18 level in standard & you can raise the level to 32 or 36 (i am not sure which one's right) with the help of an abaper.

It kind of gives you a short hand in keeping the pdt/service in your mind, just by looking at the combinations you can tell which all the pdt's were used in the total pack.

Reward points if it helps

Regards,

N

Answers (4)

Answers (4)

Former Member

HI

HOPE THIS WILL HELP U OUT

<b>Product hierarchy</b> is used for pricing. A product hierarchy is an alphanumeric character string which consists of 18 characters at the most. Product hierarchy thus define the product and its composition. To take an example, a product hierarchy could be 00010002000300040005. The first four characters 0001 could indicate that the product is a car. The next four characters could indicate 0002 the plant in which the car has been manaufactured. The third set of characters could indicate the color of the car. The next set may determine its engine capacity and so on. Thus, the product hierarchy helps in defining the product composition.

<b>Pricing Procedure in Product Hierarchy</b>

But if you want an example here goes. Say, you want to base your pricing procedure on first three digits of product hierarchy, defined in the material master, via condition technique.

Pricing structure for line item is KOMP. A quick look thru KOMP structure (tx SE11) shows that you have only PRODH field for all 18 digits of product hierarchy, whereas you need only the first three. So you do the following:

1. Create the new data element ZZPRODH1. Also create a domain with the length "3" and the data type "CHAR" for the new data element. Remember that new data fields must start with the letters "ZZ" or "YY", since SAP reserved these letters to protect them from being overwritten during a release upgrade.

2. Check whether the product hierarchy (PRODH) is found at header or at item level. In table VBAP, document field PRODH is defined as an item field.

3. Integrate the field name ZZPRODH in the communication structure KOMP using the INCLUDE KOMPAZ and allocate the data element PRODH to it.

4. Activate the structure.

5. Check in which table the field PRODH exists.

The field is in table VBAP (sales document: item data).

6. Assign a value to the new field in the FORM routines for sales order processing and billing using the appropriate user exits: In sales order processing the user exit is found in member MV45AFZZ. The complete statement is:

FORM USEREXIT_PRICING_PREPARE_TKOMP.

MOVE VBAP-PRODH(3) TO TKOMP-ZZPRODH. ENDFORM.

The routines for assigning a value to the new fields in billing are found in member RV60AFZZ. The statement is as follows:

FORM USEREXIT_PRICING_PREPARE_TKOMK MOVE

XVBRP-PRODH(3) TO TKOMP-ZZPRODH. ENDFORM.

7. Allocate the specifications A, V and 001 to the field ZZPRODH in table T681F. Use "E" has been added for fields in rebate processing.

This is a standard example from SAP Library. In this case you must tell the ABAP three things:

- that your source field is VBAP-PRODH,

- that you need to get the first three digits from that field into your pricing structure KOMP

- and that you need to specify the transfer by user exit thru MV45AFZZ

Please note that this is a very simple example. Quite often you have to dig a lot deeper.

Modifications of Copy Control routines, making output forms (thru SapScript) and such requires you to know all the necessary tables, structures and fields.

The only advice I can give you is to use tx SE11, which will show you the organization of a table/structure, and can also help you check the contents of a specific table in a specific sales doc.

Former Member
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How a product hierarchy is implemented depends at one level on the industry you are in, and even within that it depends on how your company specifically conducts business.

What I illustrate is just one possible use. Lets consider a 4 level product hierarchy, for a company in the food business.

The 18 character production hierarchy number can be made up like this:

Level 1: First 3 characters: Bakery (001), Beverages (002), Meat (003)

Level 2: First 7 characters: 0010001 (Cookies), 0010002 (Bread), 0020001 (Carbonated Drinks) etc

Level 3: First 12 characters: 001000100001 (Chocolate Chip Cookies)

Level 4: All 18 characters: 001000100001000001 (Chocolate Chip Cookies Brand X), 001000100001000002 (Chocolate Chip Cookies Brand Y)

Even within this scenario, at the fourth level I indicate a scenario where the company has a premium and standard brand for the same product. This level could also be used in a variety of other ways, including based on packaging.

In SD, prices can be set at the prod hierarchy level. You may need to elaborate your question to get a more specific answer.

Former Member
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Hi

What is the significance of this Product Hierarchy in Production?

Can you please explain in detail "In SD, prices can be set at the prod hierarchy level"?

Thanks

Deepak Prasanna S

Former Member
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HI,

Reading your first thread i`s under the impression that Product Hierarchy is infact of bundling ur products/services into one pack for a sale. But the standard example talks about the classification of products based on a preset hierarchy. Am confused a lot now, could u clarify more?

Rgds

Former Member
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or you can see the standar example

Each characteristic of a product 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