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Free Goods and Free Product Scenario in CRM Trade Promotions

Trade Promotions can be used to provide Free Goods or Free Products. That can be if a certain amount of product is bought the customer gets products for free.

There are various scenarios for the free goods and free products scenario in trade promotions.

Free Goods or Free Products Scenario

The main difference between the free goods and free products scenario is the time when the free products are given away.

Free Goods Scenario

In the free goods scenario the trade promotion generates free goods conditions (condition usage FG).

The condition type generation is driven from the trade spend, there is any free good trade spend used. On releasing the trade promotion the FG condition is generated and transferred to SD.

In SD a sales order is generated and the FG condition is valid the free good is added to the SD order. On invoicing the SD order the ordered product is billed with the regular net value whereas the free product is billed as free product.

The free good is provided immediately once the sales order is delivered.

Free Products Scenario

In the free products scenario the trade promotion generates rebate conditions (condition usage BO).

The condition type generation is driven from the trade spend, there is any rebate trade spend used. On releasing the trade promotion the BO condition is generated and and a rebate agreement is generated in SD.

In SD a sales order is generated and the invoice is created. At that time the free product is not yet granted. Once the invoice is created and the rebate agreement will be processed a new sales order containing the free product will be created.

The free product is granted once the rebate agreement is processed. The condition type used needs to be flagged as FOC relevant. This enables the rebate to generate free of charge delivery orders.

Product Dependent and Product Independent Scenario

Both free goods and free products may be product dependent or product independent. The way the planning layout is defined determines the scenario. If the free goods planning profile is defined as planning type '6 - Free Goods' the trade promotion uses the dependent free goods scenario. If the planning profile is defined as '9 - Product Independent Free Goods' the trade promotion uses the independent free goods scenario.

Dependent Product Scenario


In the product dependent scenario free goods or free products are given away for a specific product. An example may be, if you buy product A, you get product B for free.

The product assignment block contains the assignment from each product to the free product. The assignment needs to be done for each product that is enabled for the free goods scenario.

The planning profile contains a line for the product and the free product.


Independent Product Scenario

In the product independent scenario the same free good or free product is given away for all products that are part of the trade promotion.

A free good that is valid for all trade promotion products is to be provided in the products assignment block.

In the planning profile the free good column is filled over all products.


Exclusive and Inclusive Free Goods

For free goods there are the following different scenarios available.

Exclusive Free Good Discount

When a certain amount of a product is sold, the same product or a different product is also delivered free of charge. The free products are added to the ordered products. In the exclusive free good scenario the same product can be given away or any different product can be given away.

The Free Product is added in the sales order, and delivered accordingly. The invoice however does not contain any price for the free good item.

Inclusive Free Good Discount

When a certain amount of a product is sold, the customer is not charged for the whole order quantity. The free good quantity is not added to the ordered product quantity but customer is not charged for amount of free products. The inclusive free good scenario is available for the same product as the ordered product only.


The free good is determined in the sales order. The delivery contains the order product quantity, but the invoice is reduced by the amount for the free goods.

In the trade promotion the inclusive indicator needs to be set together with the free good in the product assignment block. The inclusive scenario requires the same product as a free good product.

Customizing

Planning Profile

The free goods planning profiles need to be assigned to the planning profile group with the correct planning type, either '6 - Free Goods' or '9 - Product Independent Free Goods'. This is to be done in the following customizing:

Customer Relationship Management

Trade Promotion Management

Key Figure Planning

Define Planning Profile Groups

The FG planning profile available in the planning profile group determines the product dependent or product independent free goods scenario.

Trade Spends and Condition Generation

The trade spends and the assigned condition types need to be maintained in the following customizing:

Customer Relationship Management

Trade Promotion Management

Trade Promotions

Trade Spends

Customer Relationship Management

Trade Promotion Management

Trade Promotions

Condition Maintenance

The usage for the generated condition type defines either the free goods or free product scenario. The free goods scenario generates FG conditions, whereas the free product scenario generates BO conditions to create the rebate agreement.

Rebate Condition Type


In case the free products scenario is used the rebate type needs to be FOC enabled. This is to be done in the following customizing:

SAP Customizing Implementation Guide

Customer Relationship Management

Rebate Processing

Set Up Rebate Determination

Create Condition Types

Known Issues

There are some known issues related to the free goods and free products scenario. Those are solved with the following SAP notes:

1961062  Free product in Free Goods Promotions may get wrong pricing information

1919699  Perform Volumes/Trade Spends date validations for Free Goods promotions

1909607  Sales organization and the status of  Free Products in Trade Promotion is not checked

1803043  Marketing F4 Help for Free Good Product ID adds extra row

1666400  Incorrect free good check in rebates condition generation

1649123  Issue generating Conditions for Free Goods Promotions

Additional Information

Both the free goods and the free products scenario are designed based on different condition types. The following documents contain more information about different condition types generated from CRM trade promotions:

Campaign Determination Conditions in CRM Trade Promotions

Pricing Conditions in CRM Trade Promotions

Rebate Conditions in CRM Trade Promotions

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