Hi Kannan,
Numerous business relationships relate to contracts or agreements with customers and the represented business, based upon material, price, and quantity over a fixed period of time. They facilitate planning on behalf of the business and guarantee a fixed-price agreement with the customer. These contracts are represented in the SAP system as outline agreements.
These outline agreements take the form of quantity contracts, value contracts, service contracts, and group master contracts, which are a new functionality offered as of SAP Version 4.0.
Note It is advisable to use a different number range for contracts, as this ensures ease of use when searching for documents and referencing to contracts later.
Service and Maintenance Contract Process
The service contract is an interface and a legal agreement between the receiver of the service and the business supplying the service. It is used beneficially by the business for initiating automatic billing of routine services at regular intervals, for example, and can determine if a
cancellation request of the contract is valid. It is used beneficially by the receiver of the service as
a contract he can claim, with easy access to requests for service and set prices on specific services.
Sales Document Type Is WV
Generally, a service contract need not have a call-off or release order, nor does it need to be created with reference to other sales documents. For a service and maintenance contract, no delivery is necessary; due to the process being the offering of a service, no materials are relevant for delivering.
Value Contract Process
The value contract is similar to the quantity contract in that it limits material or services to a customer. However, instead of limiting due to the quantity of stock, the contract and its ceiling is based upon a total value.
The <b>value contract</b> is created and maintained the same way as the other standard contracts and document types, yet SAP has created its own configuration menu path in the IMG. The only
reason why I can see that this was done is to assist in the implementation of online documentation, making the documentation readily available by merely double-clicking on the function in the IMG. Nonetheless, should you wish to configure this contract by using the menu
paths created for it in the IMG, proceed as follows: IMG, Sales and distribution, Sales, Sales
documents, Contracts, Value contract.
The sales document type is WK2 for a specific material or WK1 for assortment modules.
An Assortment Module
An assortment module is a order entry tool that displays a list of materials and services that can be released from a value contract. It has a validity date and a restriction that only the materials and services that belong in the same sales organization and distribution channel for which your release order is being made will be displayed.
Specifics of the Standard Value Contract WK1 This value contract should be used for the majority of instances when a contract is based upon the total value of an assortment of materials according the particular customer. You can specify a product hierarchy or an assortment module
for value contracts of this type.
Specifics of the Material-related Value Contract WK2 This value contract should be used
when you need the functionality of a value contract, yet when using this type of contract, you are restricted to using it for one material. This one material is usually a configurable material. The contract length can be different here at the item level than at the header level.
Similarities of the value contracts WK1 and WK2 Both of the value contracts have a header level and an item level. None of the contracts have a schedule line level. Thus, neither of these
contracts are responsible for delivering products. Each of the value contracts has a release order, which is based on the total value.
The release orders are standard order types created with reference to the contract. The sold-to party must correspond to that of the value contract, or it must be a release partner. This is also true for the ship-to party.
To configure the value contracts, follow the standard procedure from the IMG, Sales and Distribution, Sales, Sales doc., Sales Document header. Or, as already explained, go to IMG, Sales and distribution, Sales, Sales documents, Contracts, Value contract.
The value contracts WK1 and WK2 have their own number range, so try to keep all contract number ranges equal to facilitate ease of use. They both have the sales document category G
(contract).
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