Explanation of Division

[Former Member]

Hi

Can somebody explain the meaning of Division. I am working on a project for manufacturing company & the company sells its products in 2 different markets. One is ABC Market & the other one is DEF MARKET. & we have to track the sales separately for ABC market righ from the entry stage.

Company sells its products directly through the factory gate.

Can we call ABC & DEF market as divisions.

Please explain

Thanks

Mohit

[Former Member · Accepted solution]

Hi Mohit,

Division is simply meants as product Group.

Ex, if the company is selling cycles and cars. Cars & cycles are distinguished as different divisions.

But as per ur requierment, u are selling a product in 2 different markets.

ABC & DEF can be classified as different sales organisations or sales offices depending upon ur business requirements.

Hope it is useful..

Reward points if useful..

[Former Member]

Dear Friend,

The following is the explanation:

Distribution Channel

The way in which products or services reach the customer. Typical

examples of distribution channels are wholesale, retail, or direct

sales.

Division

A way of grouping materials, products, or services. The system uses

divisions to determine the sales areas and the business areas for a

material, product, or service.

to Understand better I can help you with my client description .

We have Ditribution channel as : Direct ,Indirect,Semi direct ect

& Division as Molecular Biology, Immuniology, Che\mistry etc.

So what I feel is ABC & DEF market as distribution channel and the various departments and product grouping as the division

regards,

Amlan Sarkar

[Former Member]

Hi Amlan

My client manufacturers 4 products & sells it in ABC market & DEF Market. Also, materials are sold directly from the factory.

In this case, what I understood is that Distribution Channel is the Direct Sales & The ABC & DEF Market are sales organisations.

Am I right ? Please correct if not.

Thanks

Mohit

[Former Member]

Hi Mohit,

Yes, Ur understanding is correct.

More specifically u can define them as Factory sales as a dist. channel.

Thanks

Kaleeswaran

Reward if useful....

[Former Member]

Hi Mohit,

Here you can use the division depend upon the requirement.

We classify the material in to division Ex: in pharma comanies Cardiologist and Gynecologist is divisions they will classify the material in to different Division.

In Some companies Material range is very high to classify like this at the time they will use division like Sales Division and Stock Transfer Division..

As per my knowledge u can classify ABC & DEF as Distribution channel or else u can go like this also with divisions..

if you want clear clarification wait for some other Guru's Explananation..

Rewards, if it is useful..

Regards

Durga Prasad

[Former Member]

hello, friend.

division is an integral part of the organization setup of SD and is a part of the sales area. this is defined in Enterprise Structure, Logistics General in IMG.

the division is assigned to the sales organization, and is a field entry in the material master. valuations and reports can be based on the division.

for SD, you can set up different sales conditions (e.g. payment terms, shipping conditions) for the customer master based on the sales area, again of which the division is part of.

hope this helped. post again if you require more general info.

regards.

[Former Member]

Define, copy, delete, check division

In this step, you define the divisions in your company

or you edit divisions that already exist.

The division is one of the organizational units in Sales & Distribution

and is also required for business area account assignment for logistics

transactions in Financial Accounting. The business area for the material

is determined via the plant and the division defined in the material

master record.

In order to adapt the functional scope of a division to the organization

in your company, you should process the following check list:

o Allocate a division to one or more sales organizations.

o Allocate a division to one or more distribution channels.

o Allocate a business area to a division from a plant. This way,

business area account assignment can be carried out for transactions

in Materials Management. As of Release 3.0, the business area is

determined in Materials Management from the division and the

valuation area.

o A material is always assigned to one division only. You specify the

division on the first sales & distribution screen in the material

master record.

o You can define your own master data within a division for customers

as well as your own conditions and pricing.

o You can also create shared customer master data and conditions,

which apply to several divisions, using a common division.

o You can define sales offices for a division.

o You can define for each sales document type that all items of a

sales document must belong to the same division.

o The items of a delivery or a billing document can belong to

different divisions.

o The division is used as a selection criterion for lists of sales

documents and the work list for deliveries.

o You can determine the printer destination for messages differently

for every division on the basis of the sales documents.

SAP Recommendation

o Please use the division "01" as a "general division" if you do not

differentiate between divisions in your company.

o If you enter the value 01 as a parameter in the user master record,

the user does not need to make further specifications.

o Define the master data for a representative division if you do not

need to dinstinguish customer master data and pricing elements by

division. You can then use this data in several divisions.

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Division for easy umderstanding can be:

Different business area of a company, say Hardware Dept & Software Dept.

-

---

In your example, you can certainly create ABC & DEF as Division, but the impact of it will be:

1. Higher configuration for Sales Area Mapping

2. Higher Master Data maintainance, say for maintaining Pricing Condition, Customer Master & so on....

3. This would mean not utilizing server capacity to optimum

Instead, Make use of Sales Office to Identify Sales by ABC & DEF. Further, for segregation, reports can be debeloped, if standard report is not meeting the purpose.

Regards,

Rajesh Banka

Reward points if helpful

Regards,

Rajesh Banka

Edited by: Rajesh Banka on Feb 18, 2008 8:37 AM

[ranjeetrajendra_jain]

Hiya

Division is used to classify product lines widely.

Saly you are in production of Few products and you differentiate them through Produc lines or division.

Example would be two wheelers, four wheelrs, rickshaws, LMV's etc.,

You can not call different markets as division. you might configure them as two different sales areas if you wish so. But divsion is based on internal product lines and not external markets.

Regards

[Former Member]

Hi Ranjeet,

Seems the answer is incomplete.

Mohit

[Former Member]

Hi Ranjeet,

In above case, what do we call the ABC Market & DEF Market. Do we call it as sales organisations.

I am an FI guy & have no idea about SD Module. Please explain.

Thanks

Mohit

[ranjeetrajendra_jain]

Yup my key board is acting ghostly

[ranjeetrajendra_jain]

Hi Mohit.

Sorry but my key board is not really helping me today.

Division as we define in SD is totally based in internal product line difference and not external markets.

You can use a sales area., that is combination of Sal Org, Dist Chan and division for your purpose

Regards