pricing

[former_member197655]

what is pricing procedure?Can you explain with some example

[ranjeetrajendra_jain · Accepted solution]

Its a basic procedure to identify price of a perticular item in an document with several different factors like basic price + freight - Discounts +taxes ets...

Here is how it goes

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Pricing Procedures

Use

The primary job of a pricing procedure is to define a group of condition types in a particular sequence. The pricing procedure also determines:

Which sub-totals appear during pricing

To what extent pricing can be processed manually

Which method the system uses to calculate percentage discounts and surcharges

Which requirements for a particular condition type must be fulfilled before the system takes the condition into account

Example of a Pricing Procedure

If a sales department processes sales orders for a variety of foreign customers, the department can group the customers by country or region. A pricing procedure can then be defined for each group of customers. Each procedure can include condition types that determine, for example, country-specific taxes. In sales order processing, you can specify pricing procedures for specific customers and for sales document types. The system automatically determines which procedure to use.

Pricing Procedures in the R/3 System

The standard system contains pre-defined pricing procedures, which contain frequently used condition types along with their corresponding access sequences. You can, of course, modify these procedures or create your own from scratch.

Creating and Maintaining Pricing Procedures

You create or maintain pricing procedures in Customizing for Sales. For more information on creating pricing procedures, see the online Implementation Guide for Sales and Distribution.

To reach the pricing procedure screen from SD Customizing:

Choose Basic Functions ® Pricing ® Pricing control ® Define and assign pricing procedures.

Select the transaction that you want to execute.

Regards

[Former Member]

Purpose

The term pricing is used broadly to describe the calculation of prices (for external use by customers or vendors) and costs (for internal purposes, such as cost accounting). Conditions represent a set of circumstances that apply when a price is calculated. For example, a particular customer orders a certain quantity of a particular product on a certain day. The variable factors here - the customer, the product, the order quantity, the date - determine the final price the customer gets. The information about each of these factors can be stored in the system as master data. This master data is stored in the form of condition records.

The Condition Technique in Pricing

The condition technique refers to the method by which the system determines prices from information stored in condition records. In Sales and Distribution, the various elements used in the condition technique are set up and controlled in Customizing. During sales order processing, the system uses the condition technique to determine a variety of important pricing information. For example, the system automatically determines which gross price the customer should be charged and which discounts and surcharges are relevant given the conditions that apply.

Example of Pricing in the Sales Order

The following figure shows how the condition technique works in the background to produce the pricing information. The diagram shows how the various elements in the condition technique work together.

The system determines the pricing procedure according to information defined in the sales document type and the customer master record.

The pricing procedure defines the valid condition types and the sequence in which they appear in the sales order. In the example, the system takes the first condition type (PR00) in the pricing procedure and begins the search for a valid condition record.

Each condition type in the pricing procedure can have an access sequence assigned to it. In this case, the system uses access sequence PR00. The system checks the accesses until it finds a valid condition record. (Although you cannot see this in the diagram, each access specifies a particular condition table. The table provides the key with which the system searches for records).

In the example, the first access (searching for a customer-specific material price) is unsuccessful. The system moves on to the next access and finds a valid record.

The system determines the price according to information stored in the condition record. If a pricing scale exists, the system calculates the appropriate price. In the example, the sales order item is for 120 pieces of the material. Using the scale price that applies to quantities from 100 pieces and more, the system determines a price of USD 99 per piece.

The system repeats this process for each condition type in the pricing procedure determines a final price.

For further information on the condition technique, see Introduction to the Condition Technique

http://help.sap.com/saphelp_470/helpdata/en/64/7836b39c8911d199aa0000e8a5bd28/content.htm

regards,

Amlan Sarkar

[Former Member]

Hi,

in simple terms, in order to be able to sell a product to a customer in business there would be the following elments :

1) Price (at which you want to sell)

2) Discounts

3) Freights

4) Taxes

In sap we map all these activities in terms of condition types. To arrive at the price the customer has to pay we need to put all these conditions in a proper sequence which is nothing but a Pricing Procedure.

Depending on the business requirements we build a pricing procedure with all the prices, discounts, freight and taxes pertaining to the local needs. Agains them we assign some requirements which work as validations and some formulas.

regards

sadhu kishore

[Former Member]

Check the Pricing Procedure:

In SD, Pricing Procedure is determined based on Sales Area (Sales Organization + Distribution Centre + Division) + Customer Pricing Procedure + Document Pricing Procedure. Sales Area is determined in Sales Order Header Level. Customer Pricing Procedure is determined from Customer Master. Document Pricing Procedure is determined from Sales Document Type / Billing Type (if configured). Once the pricing procedure is determined, Condition records are fetched. If appropriate condition records are found, the price is determined. If Mandatory pricing condition is missing, system will through an error message.

In SD, the steps to configure Pricing procedure are as under:

Step 1:

Condition table (T.Code: V/04): If existing condition table meets the requirement, we need not create a new condition table. Considering the requirement for new condition table, the configuration will be done in spro as follows: IMG --> Sales & Distribution --> Basic Function --> Pricing Control --> Condition Table (select the required fields combination, which will store condition record).

Step 2:

Access Sequence (T.Code: V/07): If existing access sequence meets the requirement, we need not create a new access sequence. Considering the requirement for new sequence, the configuration will be done in spro as follows: IMG --> Sales & Distribution --> Basic Function --> Pricing Control --> Access Sequence (Access sequence is made up of Accesses (Tables) & the order of priority in which it is to be accessed. Here we assign the condition table to access sequence.

Step 3:

Condition Type (T.Code: V/06): If existing condition type meets the requirement, we need not create a new condition type. Considering the requirement for new condition type, the configuration will be done in spro as follows: IMG --> Sales & Distribution --> Basic Function --> Pricing Control --> Condition Type. It is always recommended to copy an existing similar condition type & make the neccessary changes. Here we assign Access sequence to Condition type.

Step 4:

a. Pricing Procedure (T.Code: V/08): It is recommended to copy a similar pricing procedure & make the neccesary changes in new pricing procedure. Pricing Procedure is a set of condition type & arranged in the sequence in which it has to perform the calculation. Considering the requirement for new Pricing Procedure, the configuration will be done in spro as follows: IMG --> Sales & Distribution --> Basic Function --> Pricing Control --> Pricing Procedure --> Maintain Pricing Procedure.

b. Pricing Procedure (T.Code: VOK0): After maintaining the pricing procedure the next step will be determination of pricing procedure. Configuration for determining pricing procedure in SPRO is as follows: IMG --> Sales & Distribution --> Basic Function --> Pricing Control --> Pricing Procedure --> Determine Pricing Procedure.

5. Condition record (T.Code: VK11 / VK12): Condition record is a master data, which is required to be maintained by Core team / person responsible from the client. During new implementation, the condition records can be uploaded using tools like SCAT, LSMW, etc. Condition Record is maintained in T.Code: VK11 / VK12, which are captured in Sales Order & Billing.

Also check document pricing procedure in Sales Document Type (T.Code: VOV8 - Sales order Type, VOFA: Billing Type (If Required)), customer pricing procedure in Customer Master Data (T.Code: XD02), ... are in place.

Regards,

Rajesh Banka

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