Difference between Distirbution channel and Division

[srinivas_anilkumar]

Hi,

Could you please let me know the diff between Distirbution channel and Division with few examples.

Will award points promptfully.

Thanks and Regards,

Srini

[Former Member · Accepted solution]

Distribution channel is nothing but your channel of distribution of goods. Say wholesale, retail, ecommerce, factory outlet etc.

Division is nothing but your product range...say electronic goods, hardware, sapre parts etc.

Vishal

[Former Member]

Hi Srinivas,

I have a documentation on ES , thought it would be useful to you,

<b>ENTERPRISE STRUCTURE:</b>

Enterprise Structure or Organizational Structure is a framework in which all business transactions can be processed.

• Company Code: it is the company for which we implement SAP. It is defined by FI. (4 digits code). It is the highest level of organizational element in Ent Stru, which allows posting revenues to G/L accounts.

• Sales Organization: (4 digits code) is an organizational unit responsible for sale and distribution of goods and services.

• Distribution Channel: (2 digits code) is a channel through which goods or services reach the customer.

• Division:(2 digits code) the range of goods or services that the company manufactures falls in to different divisions.

• Sales Area: combination of Sales Organisation, Distribution Channel and Division.

• Sales Line: combination of Sales Organisation and Distribution Channel.

• Sales Office: geographical aspect of the organization. Sales offices are assigned to sales areas.

• Plant: the factory is called the plant in SAP.

o Company Code to Sales Organisation: One to Many

o Sales Organisation to Distribution Channel: Many to Many

o Distribution Channel to Division: Many to Many.

o Plant to Company Code: Many to One. In Intercompany: Many to Many

o Plant to Shipping Point: One to Many. Many to Many if in one geo area.

o Plant to Sales Organisation: Many to Many.

o Division is always organization specific.

o If sales organisation wants to use a plant, that plant must be assigned to the sales orgn.

o Master data records are multiplied by each additional organizational element you have.

Menu Path for Sales Orgn/ Distbn Channel/ Sales Office/ Sales Group:

SPRO- IMG- Ent. Stru. - Defn. - S.D.- Define, Copy, Delete, Check Sales Orgn/ Distbn Channel/ Sales Office/ Sales Group.

Menu Path for Division Creation:

SPRO- IMG- Ent. Stru. – Defn. – Logistics General- Define, copy, delete, check div.

Defining Plant:

SPRO- IMG- Ent. Stru. – Defn. – Logistics General- Define, copy, delete, check plant.

A plant, though always linked to one company code, can be linked to several sales organizations.

Assigning Plant to Company Code:

SPRO- IMG- Ent. Stru. – Assignment- Logistics General- assign plant to company code.

Define Sales District: OVR0

SPRO- IMG- Master Data- Business Partner- Customer- Sales- Define Sales District.

Assignment Path:

SPRO- IMG- Ent. Stru. – Assignment – Sales & Distbn. :

Assign Sales orgn to company code: company code 4 digits code.

Assign Distbn channel to Sales orgn

Assign Division to Sales orgn

Set up sales area

Assign sales office to sales area

Assign sales group to sales office

Assign plant to sales orgn – Distbn channel

Business area account assignment:

Define rules by sales area

Assign business area to plant & div.: through plant and division.

Assign business area by sales area: through sales area.

Plaese reward point if it helps

[Former Member]

Hi

Distribution Channel-DC is nothing but how you reach to ur customers.eg. Direct Sale,Retail,Distributor etc.

Division-Division is group of products.eg. Television division,Referigerator division etc.

Reward points if it helps...........

[Former Member]

Hi Srinivas,

Distribution Channel: - It is the channel through which goods are reaching the customers.

Divisions: - The range of products or services that the company manufacturing falls into different divisions.

<u><b>RELATIONSHIPS:</b></u>

<b>Company code to Sales Organisation</b>: - One company code can have many sales organizations. But one Organisation has to be assigned to one company code. So the relation is one to many.

<b>Sales Organisation to Distribution channel</b>: - One Organisation can have many distribution channels. One Distribution channel can be assigned to many organizations, so the relation is Many to Many.

<b>Sales Organisation to Division:</b> - One Organisation can have many divisions. One division can be assigned to many organizations. So the relationship is Many to Many.

<b>Distribution channel to Division</b>: - One Distribution channel can have many divisions. One division can be assigned to many Distribution channels. So the relationship is Many to Many.

NOTE: - Division is always Organisation specific.

NOTE: - If sales Organisation wants to use a plant that plant must be

assigned to the Sales Organisation.

Reward if it helps.

[former_member227476]

dear srinivas,

distribution channel is nothing but in which channel the product is reaching the customer Ex: direct sales, factory sales, showroom sales, whole sales, retailers,

etc... so that business will know that which channel is more effective in reaching the product to the customer ..

division is nothing but under which division this product is coming ex: telecon, textile, soaps, etc.. so that business will come to know that in which division it is getting more profits and on which division it is spending more expences.. etc

rewards if it helps

siva

[Former Member]

hi,

Distribution Channel: through which your product and services would reach your customers.

ex: wholesaler, Retailer, Web based. or Catalogue etc.,

Division: represents the product line in SAP.

ex: Air-conditioners, televisions, refrigerators and so on.

Regards

KR

[Former Member]

A sales organization is an organizational unit that sells and distributes products, negotiates terms

of sale, and is responsible for these transactions. A distribution channel is a channel through

which materials or services reach customers. Typical distribution channels include wholesale,

retail, and direct sales. You can assign a distribution channel to one or more sales organizations.

A customer can be delivered from multiple distribution channels. A material master record can be

maintained with different sales organization and distribution channel views, allowing different data

to be accessed.

A division is a product group that can be defined for a wide-ranging spectrum of products. You

can make customer-specific agreements for every division, such as partial deliveries, pricing, and

terms of payment. Within a division, you can carry out statistical analyses or set up separate

marketing. Please note that divisions are utilized in SD but they are defined and maintained in

IMG, Enterprise structure, Maintain structure, Definition, Logistics general.

[Former Member]

Hi,

say you have a product, this you can sell in whole sale where you might say the cusotmer has to buy minimum " X " qty because of which you will give more discount. Now the same product can also be sold through retail without any discount for whatever qty the customer is going to ask.

Basically the product range a company has will be identified as divisions and the way its sold is called a distribution channel.

Thanks

Sadhu Kishore

[Former Member]

The distribution channel represents the channel through which salable materials or services reach customers. Typical distribution channels include wholesale, retail and direct sales.

UseWithin a sales organization a customer can be supplied through several distribution channels. In addition, the material master data relevant for sales, such as prices, minimum order quantity, minimum quantity to be delivered and delivering plant, can differ for each sales organization and distribution channel.

Structure

A single distribution channel can be assigned to one or more sales organizations.

Product groups, i.e. divisions, can be defined for a wide-ranging spectrum of products.

For every division you can make customer-specific agreements on, for example, partial deliveries, pricing and terms of payment. Within a division you can carry out statistical analyses or set up separate marketing procedures.

[Former Member]

HI

DC is Channenl through which you sell your products and services

Example:

Wholesaler

Retailer

Dealer etc..

Division is Spectrum of Products..

Take for Example in It industry you can make broadly two divisions like

Hardware

Software

Take for FMCG Major HLL

They have Divisions like

Healthcare division

Skincare division

Haircare division etc

Regards

mbs