SD Sales scenario and Org structure in IS-Retail:

A Customer is a party who procures goods and services from a company. Two general types of customers can be
differentiated in the system for the logistic processes:
1) Internal customers (for example own sites/Stores)
2) External customers (for example wholesale customers who buy goods at a DC)

The Customer master record contains data that controls how business transactions are recorded and processed by
the system. Customer master records are also used to reflect as much information about the customers as possible
whether internal (stores) or external (wholesale buyers). This is to enable the company to know their customers
and to make it possible that the company can offer special payment terms for specific groups of customers.
Standard account groups will be used for the creation of customer master. As customers are also debit-side
business partners in accounting, customer master records are used in Financial Accounting and Sales and
Distribution. Additionally, as sites are customers from the point of view of delivery, each site has a customer
master record.

2.1.2 ARTICLE MASTER

2.1.2.1 Definition
The article master is the main source of data on articles in a company. The article master is an identification of an
article. It contains information on all the articles that a company procures or produces, stores, and sells. It is the
company's central source for retrieving article-specific data. This information is stored in individual article master
records. An article master record contains:
Descriptive data, for example, Article Description, Size & Weight

Control data, for example, Article Type

Data that is automatically updated by the system, for example, Moving Average Price, Warehouse Stock
Article master records also contain data that is entered directly by the users and data that is updated automatically
by the system. It contains article-relevant data and data from other areas of the system that may be relevant for
articles. These areas are called user departments in the article master. Unnecessary data storage is reduced when
all data is stored in a single database object.] [Article: An article is the smallest unit that can be ordered
independently and that cannot be spilt further into smaller units. Articles are, however, not always sold in the form
in which they were purchased. The single article is the “standard article” that is sold to the customer; it is the
classic “SAP article”.]
2.1.3 SITES
Stores / Distribution centre master data should contain information to enable the following functions:
Procurement / Inventory Management

o To model the associated business processes such as goods receipt, physical inventory, goods issue.
o Planning: Replenishment planning, and purchase order processing

Sales / Taxation
o POS: To enable information to POS for ease of billing operations, cash and credit card sales

In SAP Retail such locations (Store/DC) can be created as sites.

In a DC or a Store there would be requirement to maintain inventory records like goods receipt, issue, transfers,
balances and values etc. Similarly, documentation of goods stored in Distribution Centre and store is required for the
purpose of inventory management. A DC or a store has its own requirement planning for taxation and inventory
management. By creating a site above can be achieved in SAP.
2.1.4 DISTRIBUTION CENTRE
It is the warehouse that caters to different stores. Goods are stored in a DC for short period of time and then
transferred to stores or customers. DC enables centralized buying for different stores thus, helping in achieve
logistics and purchasing cost optimization. Further it helps in better management of inventory. Generally wholesales
process are envisaged from DC and also stock transfers take place from DC to Store. Billing for wholesale will be
done through DC.
A distribution centre is assigned to a purchasing organization, and may also be assigned to a distribution chain for
the purposes of sales price valuation, stock transfers and statistics.
A distribution centre can also supply a number of distribution chains. In the same way, a site can also be supplied
with goods from different distribution chains.

2.1.5 STORE
Type of site in which goods are presented and sold to consumers. Store is assigned to one purchasing organization
and one distribution chain. (For Details on Purchasing Organization and Distribution Chain refer to Business
blueprint section Organization Structure)
A site is always a combination of the site master and the customer master. The site master is required as sites are
organizational units with their own inventory management and requirements planning. A site is also a customer,
because from a central point of view, sales functions are also performed, such as deliveries and invoicing, hence
customer master for the site has to be maintained. Designing site as a vendor/ customer will not trigger any
financial impact. Information for external customers will be available at all the sites.

A store is always assigned to a distribution chain and may be supplied by distribution centres via several
distribution chains. Each store is assigned to one storage location for inventory management. Distribution centres
can have more than one storage location. The merchant ID assigned to a store is used for billing sales with a credit
card (for example, American Express, Visa Card) at the relevant clearing point.
A distribution centre (DC) is also a vendor, as it provides other sites with merchandise; hence vendor master has
to be maintained for site, which is DC(DC to DC STO).
A distribution centre delivers merchandise to stores that belong to one or more distribution chains. A distribution
centre can be assigned to one Distribution Chain. Vendor master will also be available at store wherever required.
Site Master Data:
Organizational/Calendar view: All organizational units to which the site is assigned is available here. Data as
which sales org, purchase org, company code, distribution channel, various purchase organizations and distribution
chains the site is assigned.

Address view: Address for communication, tax information are maintained here

Valuation and inventory management view: Valuation area, Inventory management profile, retail re-valuation
profile

Listing and requirement planning view: Listing conditions and assortment, requirement planning

Purchasing and Distribution view: Maintain data on Purchasing (regular vendor, source list) Distribution profile

POS view: Maintain the POS inbound and out bound profiles, POS currency and assortment list profile
Layout view: It is often desirable for stores belonging to the same distribution chain, or departments in a store, to
have the same system of merchandise presentation and shelving structure, regardless of their size. This allows
customers to find their way better round a store, no matter whether it is their home store or a store in a different
town, and therefore provides greater customer satisfaction.
To achieve this as cost-effectively as possible, you can define site layouts in SAP Retail.You assign these layouts to
sites or individual departments. A site layout is divided into layout areas.Layout areas in turn are divided into layout
modules, where articles are assigned.

The system proposes site master data from the reference site if you are using the reference site. Reference site
helps in the creation of other sites, where master records from the reference sites flows to the new site.

Customer Master Data When goods are transferred from one site to another (the receiving site has to be a
customer for the issuing site). Hence, the customer master data is maintained for receiving site.
The customer number of the store will be the same as the site number. Even Distribution Centres can have the
function of a customer, when goods are transferred from one site to the DC. The customer number of the DC will
be the same as the site number. Customer master record has to be maintained for all sites. The account group is
defaulted from the site profile.

STOCK TRANSPORT ORDER

The physical transfer of goods from the distribution centre to stores or from one store to another store or from store
to DC is done based on the stock transport order. The stock transport order is released after the allocation of material
(Please refer to the section of Allocation in MM blueprint for details on the allocation process).

SALES ORGANIZATION
The Sales organization is responsible for negotiation and fixing general Sales price conditions and terms with
Customers. It is responsible for all Sale transactions across Head office, Region, Zone, Distribution Centre and
stores.
DISTRIBUTION CHANNEL
The distribution channel is the channel through which saleable materials or services reach the customer. Distribution
channels include selling to consumers through various types of retail outlet or via mail order. Implications
Following distribution channel is being proposed for PRHPL project.
01- Retail DISTRIBUTION CHANNEL (Distribution Channel for sales at store)

02- Stock transfer DISTRIBUTION CHANNEL (Includes Consignment)

03- Wholesale DISTRIBUTION CHANNEL

04- Export DISTRIBUTION CHANNEL

DIVISION
A division is an organizational unit based on responsibility for sales or profits from saleable materials or services.
A way of Grouping Article, Products, or Services
SAP Retail does not use division for any functions but a division should still be defined.

Implications
Create one dummy division R1 Retail.

Planet specific sales process:

The following 3 models have been identified --- Model 1 – Case such as VAMA: Goods will be transferred from Planet
Retail to VAMA using stock transfer. VAMA is using Planet Retail’s POS system. As such, Planet Retail has access to POS
data. Based on POS sales data received in SAP system, sales order in favor of VAMA will be created (possibly through
BDC tool which will be explored during realization phase). Normal sales process i.e. delivery, PGI (post goods issue) and
billing will be executed to generate invoice in favor of VAMA after deduction of consignment commission.

Model 2 – Case such as JK: Goods will be transferred from Planet Retail to JK (owned by third party) using stock transfer.
Items will be sold from POS to end-customer. This sale will directly be booked in the books of Planet Retail. A percentage
of the entire sales will be given to the third party as a commission. System will provide sales reports to assist calculation
of commission. The commission entry will be passed through FI.

Model 3 – This model is similar to the model 1. The difference is that the consignee agent is using its own POS system,
and this POS data is not available in SAP system. Goods will be transferred from Planet Retail to consignee using stock
transfer. Consignee will sell goods through the POS to end-customer. Planet Retail will receive sales data from consignee
in mutually agreed format. Based on this data, sales order in favor of consignee will be created by user. Normal sales
process i.e. delivery, PGI (post goods issue) and billing will be executed to generate invoice in favor of the consignee
agent.

Treatment for Vama

Vama is to be treated as a consignment agent. The only difference with other consignment agents is that as
Vama is using our POS system, we have access to its sales data. We will get the POS data to SAP system,
but unlike other stores, this data from Vama will not lead to any inventory, sales or receivables postings. SAP
will provide a report about Vama’s end-sales. Based upon this report, sales cycle from PR to Vama will be
processed in the same manner as that of other consignment agents. PwC will look into automation of
consignment processing based upon data received from VAMA POS as discussed earlier (possibly through
BDC tool which will be explored during realization phase).

WHOLESALE PRICING (Planet business specific)

Requirement of pricing is to pick up the right price for a given condition at the time of sales transaction. The other
statutory requirements like Excise, Sales tax, and should be automatically calculated by the system to eliminate the
error while posting those values in the respective GL accounts. Pricing should provide the scope of discount
applicability for a customer / combination of customer and material / material on case-to-case basis. Pricing should
provide flexibility of changing the price and getting it approved before finalization of deals with the customer. The
requirement of having centralized control mechanism to ensure maximum realization to the company. Sales order
pricing should also be able to comprehensively capture all order related costs like freight, insurance, duties, material
cost etc to arrive at the net order contribution. The rebate(turnover discount) will be adjusted at period end by way of
rebate agreement functionality of SAP. The rebate adjustments are done at period end by way of credit memos and
are based on quantity/value of the sales during the specified period.

RETAIL PRICING (Planet business specific)

The retail prices for domestic supplier (e.g third parties at debenham) articles will be uploaded into the system as the
final sales prices to be transferred to POS systems. For domestic manufactured articles, and imported articles PRHPL
follows the markup pricing based on net landed cost. The net landed cost value is calculated including freight ,
customs, insurance. For MRP of these articles markup is calculated on the net landed cost. Where international price
is available the MRP is calculated based on uplift on the international price. Comparison on MRP with markup is
done and the better amongst them is selected as the MRP. In SAP, condition types will be created to capture the
MRP of articles. Also, MM module will capture the various cost components in different condition types for
capturing the net landed cost of the articles and the international retail prices.

Assortment definition: An assortment is a collection of articles, which is valid for a period of time. This
assignment can be made either directly of via assortment modules. The articles are used altogether in assortments.
Assortment defines which articles are to be carried in which retail sites (distinguished by different periods of
time).
The assortment range is determined by assigning assortment modules. Assortment module is a group of articles
that are to be managed together over a specified period as an assortment or as part of an assortment. An
assortment can consist of one or more assortment modules. Articles are assigned to assortments through assortment
modules created especially for the purpose Generally create assortment modules to group together articles that have
a relatively long life cycle or that are fairly uniform enterprise-wide or that need to be grouped together for a specific
purpose (such as a promotion). This method of assigning articles does, of course, still allow you to apply assortment
rules.
Local assortments: These are designated as type A for stores and type B for distribution centres. When you create a
site (store or distribution centre), the system automatically creates a local assortment, which it then assigns to the
site. This local assortment is site-specific and cannot be assigned to any other site. Each site has exactly one local
assortment.
General assortments: General assortments can be assigned to any number of customers, with one or more
assignments for each sales area. They can also be assigned to any number of stores and distribution centres, provided
you have activated the multiple assignment flag in Customizing. Assortment User An assortment user must be
assigned to an assortment before it can use the articles in that assortment for its various business functions. The
scope of functions available is determined by the category of assortment user. Currently, there are the following
categories of assortment users:
1) Stores
2) Distribution centers
3) Customers

Listing Procedures: Listing procedures determine how the system checks the assignment of articles to assortments
(and thereby to the stores, customers, or distribution centres using those assortments).
Listing procedures control the result of the listing process. They allow a high level of flexibility in Assortment
Management.
Basic Listing procedures: SAP delivers a number of listing procedures intended to simplify Customizing, which is
otherwise rather complicated.

The Standard listing procedure that will be used in PRHPL will be:
Basic procedure: Merchandise category /assortment level (B1)

This procedure checks:

Whether the article's merchandise category is assigned to the assortment and, if so the merchandise gets listed in the
assortment.

ASSORTMENT:
The proposed assortment for the project will be as under.
1) Assortments will be created brand wise and on other factors.
2) All the stores which will have those brands will be listed to the assortment as assortment users.
3) For every assortment corresponding Assortment Modules will be created. For example, for National Assortment,
National Assortment Module and for regional assortment, Regional Assortment Module will be created.
4) All the articles which would be sold nationwide across all stores will be listed in the National Assortment Module
and region specific articles will be listed in the Regional Assortment Module.
5) Based on PRHPL requirements more assortments and assortment modules will be created based on other factors.

SAP IS-Retail system is being used for procurement, inventory management and sales. The specific scenario of
selling through Point of sales system needs to be interfaced with SAP. SAP POS interface enable you to provide
your store POS systems, with all the relevant data required to handle the store processes independently. The IDoc
technique enables all the messages that can be exchanged between SAP Systems and the store systems. Settings
are made to define which information (messages) is exchanged in the form of intermediate documents (IDocs).
Checks are made to ensure that the data arrives even if the receiving system cannot be accessed when the data is
sent. You can regularly supply the POS systems in the stores with current data (master data, such as EANs,
conditions, and merchandise categories) via the POS interface - outbound. This means that the master data only
has to be maintained in the central system.

Information can be uploaded from the POS systems to the central Retail system via the POS interface - inbound.In
addition to the initial supply of data, another important aspect is the continuous preparation of change data, such as
price changes. If master data is changed, the system prepares the data in question in IDoc format after initialization
(initial supply of data to the store), taking account of the current store assortment. As soon as a user maintains master
data, the application creates a change document. If the modified field is relevant for the store, a change pointer is
created. The Idocs and related features with XI will assist in transfer of data between SAP Retail and POS. The
required fields (vendor etc , if required) need to be specified and will be mapped in the Idocs. The detailed mapping
of fields (discounts, coupons etc) will be carried out in the realisation phase alongwith Triversity integration. Types
of business information that SAP Retail sends through the POS outbound interface to store system are as
under.
Article master data
Article sales price
EAN/UPC assignment
Customer data
Products
Taxes
Merchandise Category Master
Label data
Assortment List
Promotion

Types of business information that SAP Retail can receive through the POS inbound interface from store
system are as under.
Sales Data (receipt based and aggregated)
Cashier data
Payment types
Store Order
Financial Transaction
Inventory
Other business information (like customer based data & pricing) will be covered in POS blueprint.

4.2.5 Accounting of POS Sales

4.2.5.1 Tender Types
For sales made through POS, account receivable from service providers will be accounted through
Tender Types. Service Providers Account will be maintained in GL for each tender types. These GL
Accounts will be Non-Reconciliation accounts and will be open item managed. To capture and for clearing
transactions store wise unique MIDs will be used. The following Tender types for receipt are envisaged:
i) Cash – Legal tender in INR notes and coins.
ii) Credit card/Debit card – Generally accepted debit/credit cards approved by HO and readable by EDC
machines e.g. Visa/Master/Amex.
iii) Cheque / DD/Pay order
iv) Gift Voucher – This is a special Tender type. These vouchers will be redeemable within a limited
validity period. Accordingly a note will have to be given on the gift voucher.
v) Credit note – Issued to any customer for return of articles sold to be exchanged for fresh article.

Any combination of the above tender types will be activated at POS.

4.2.5.2 Accounting of Sales

Accounting of sales to customers billed through POS will be as under
At POS day-end, the aggregated POS data containing item wise sales total & sales returns will be sent to SAP from
POS back-end; Sales data from POS will be recorded using the following scheme of entries:
Sales Clearing A/C (site as a Customer) …..Dr.
To Sales Retail A/c
To Output VAT/Sales Tax payable (Site wise) A/c

4.2.5.3 Accounting of Tender types

For Tender type payment card, separate GL accounts will be maintained for the respective service
providers, for site wise identification of the service providers unique MID (Merchant ID) nos. will be
assigned. Account and the transactions under this account for any store will be identified with a unique
MID. The same MID will be given to POS for correct accounting of receipts through Triversity. These GL
accounts will not be reconciliation accounts in nature & and will only be open item managed on the basis
of these unique codes. The credit entries will be captured MID/Store ID wise & collections cleared against
the respective MID/Store ID. On the basis of the aggregated cashier declaration and the reconciliation of
the sales with collection (as per the tender type) the following illustrative entry will be passed –

Cash at Store A/c……Dr. (For tender type Cash store wise)

Credit Card Receivables-Bank….. A/c ….Dr. (For tender type Debit/Credit Card store and bank wise)
Gift Voucher Redeemable A/c Dr.
Credit Note Payable A/c Dr.
Discount ……..…. Dr. (For all promos/discounts offered at POS – discount type wise including GV coupon scheme)
Cashier Shortage/Excess A/c….Dr. (For aggregated daily shortage)

To Sales Clearing (site as a Customer) A/c

To Gift Voucher Redeemable A/c
To Credit Note Payable A/c
Accounting of Wholesale
Sales to Customer types Institutional, Group Companies etc will be recorded using the following scheme
of entries:
Sundry Debtors (type wise).. Dr.
Discount on Sales (type wise)…Dr. (For all discount and promotions)
To Sales – Wholesale
To Output VAT/CST Payable

Sales to Customer type Export Customer will be recorded using the following scheme of entries:
Sundry Debtors – Export Dr.
To Sales – Export