What is Master Conditions in SAP?
Master conditions in SAP are conditions that determine the effective price in the purchase order. They serve as a central repository of pricing for purchase orders. They are automatically included in the price calculation in the purchase order if the PO references a contract or an info record, or if it meets certain criteria defined in the extended conditions.
There are three types of master conditions in SAP,
Conditions in contracts – Conditions in a contract apply to all release orders issued against the contract.
Conditions in info records – Conditions in the info record apply to orders that specify the material and vendor contained in the info record.
Extended conditions – These are a flexible way of setting vendor pricing. Extended conditions are master conditions that are included in the price calculation in a purchase order only if the PO meets certain criteria. One way to use extended conditions would be to define a 10% discount on all orders placed with a specific vendor that are created by a certain purchasing organization. In this case, the vendor number and purchasing organization are the two criteria a PO must meet before the price in the PO can be calculated.
Extended conditions are more flexible than master conditions in info records or contracts because you can define which criteria they must meet before they are applied to a purchase order.
The documentation on outline agreements and purchasing info records shows how the conditions specified in outline agreements and purchasing info records, respectively,
influence the calculation of the effective price in the purchase order.
The next post will learn how to specify conditions that apply to the pricing of all orders for any material with a vendor, not only for a specific material or material group as is the case with outline agreements and info records.
What is Condition Technique in SAP?
To discuss the Condition technique in sap, The condition technique is used to define pricing across applications. For example, it is used in the SAP SD (Sales & Distribution) module as well as in the SAP MM module. The goal of the condition technique is to calculate the effective price in a purchase order. Master conditions are simply conditions defined with the condition technique. While this section is not essential to your understanding of master conditions in purchase orders, it does provide useful background information on the mechanism for determining pricing in Purchasing.
The Basic elements of the condition technique,The condition technique consists of four main elements:
Master conditions in SAP are conditions that determine the effective price in the purchase order. They serve as a central repository of pricing for purchase orders. They are automatically included in the price calculation in the purchase order if the PO references a contract or an info record, or if it meets certain criteria defined in the extended conditions.
There are three types of master conditions in SAP,
Conditions in contracts – Conditions in a contract apply to all release orders issued against the contract.
Conditions in info records – Conditions in the info record apply to orders that specify the material and vendor contained in the info record.
Extended conditions – These are a flexible way of setting vendor pricing. Extended conditions are master conditions that are included in the price calculation in a purchase order only if the PO meets certain criteria. One way to use extended conditions would be to define a 10% discount on all orders placed with a specific vendor that are created by a certain purchasing organization. In this case, the vendor number and purchasing organization are the two criteria a PO must meet before the price in the PO can be calculated.
Extended conditions are more flexible than master conditions in info records or contracts because you can define which criteria they must meet before they are applied to a purchase order.
The documentation on outline agreements and purchasing info records shows how the conditions specified in outline agreements and purchasing info records, respectively,
influence the calculation of the effective price in the purchase order.
The next post will learn how to specify conditions that apply to the pricing of all orders for any material with a vendor, not only for a specific material or material group as is the case with outline agreements and info records.
What is Condition Technique in SAP?
To discuss the Condition technique in sap, The condition technique is used to define pricing across applications. For example, it is used in the SAP SD (Sales & Distribution) module as well as in the SAP MM module. The goal of the condition technique is to calculate the effective price in a purchase order. Master conditions are simply conditions defined with the condition technique. While this section is not essential to your understanding of master conditions in purchase orders, it does provide useful background information on the mechanism for determining pricing in Purchasing.
The Basic elements of the condition technique,The condition technique consists of four main elements:
- Condition types
- Condition tables
- Access sequences
- Calculation schema (pricing procedure)
These concepts are important for understanding how the system determines pricing in master conditions.
Condition type is a representation of a pricing element. Condition types exist for discounts, surcharges, and freight costs, for example. You use condition types to enter pricing in purchasing documents. You learned how to specify condition types when entering pricing in quotations and purchase orders, for example.
Condition table defines the combination of fields (the key) that identifies an individual condition record. The system stores the condition data you enter in the form of a condition record. For example, when you enter a vendor’s pricing in a purchasing info record with reference to a material master record, the key of the condition table includes the vendor number and the material number.
The actual pricing information – such as the gross price and any discounts – is stored in a condition record under this key.
Access sequence is a search strategy that the system uses to find condition records for a particular condition type. The access sequence determines the sequence in which the system searches condition records for a valid price.
Price calculation schema (pricing procedure), The calculation schema (also known as a pricing procedure, but the same mechanism can also be used to calculate tax amounts, periodend rebates, or costs, for example) is a group of condition types, defined in a particular sequence. It enables the system to determine that a particular set of condition types, in a specified sequence, apply in given circumstances. For example, the calculation schema determines Which condition
types apply to the gross price. The calculation schema also determines that the condition types for discounts are calculated in the effective price automatically.
With SAP MM Customizing, you can define price calculation schemas for specific vendors and/or purchasing organizations. The system searches for pricing data in condition records. The criteria it uses in the search depend on the keys in the condition table. The sequence of the search depends on the access sequence specified for the condition type. Which condition types are used in the search are defined in the calculation schema.
For example, suppose that you have just created an info record that specifies a 10% discount from the gross price. This
condition is then stored in a condition record under the vendor and material number. When the material is ordered from the vendor in a PO, the system searches for the discount using the access sequence. The calculation schema ensures that the 10% discount is deducted from the gross price instead of the net price during the price calculation process.
The different ways of maintaining master conditions, you can maintain conditions in the following ways:
Prices, As this method you can list or maintain the conditions that determine the net price in a single info record or contract. You can enter the going market price for a material.
Discounts and surcharges, As this method, you can enter discounts or surcharges that apply to all info records or contracts meeting your pricing criteria.
Other condition types, If your company has defined its own condition types, access sequences, and condition tables, you can define master conditions that use these pricing elements.
Price changes, You can change pricing by a fixed amount globally.
Condition type is a representation of a pricing element. Condition types exist for discounts, surcharges, and freight costs, for example. You use condition types to enter pricing in purchasing documents. You learned how to specify condition types when entering pricing in quotations and purchase orders, for example.
Condition table defines the combination of fields (the key) that identifies an individual condition record. The system stores the condition data you enter in the form of a condition record. For example, when you enter a vendor’s pricing in a purchasing info record with reference to a material master record, the key of the condition table includes the vendor number and the material number.
The actual pricing information – such as the gross price and any discounts – is stored in a condition record under this key.
Access sequence is a search strategy that the system uses to find condition records for a particular condition type. The access sequence determines the sequence in which the system searches condition records for a valid price.
Price calculation schema (pricing procedure), The calculation schema (also known as a pricing procedure, but the same mechanism can also be used to calculate tax amounts, periodend rebates, or costs, for example) is a group of condition types, defined in a particular sequence. It enables the system to determine that a particular set of condition types, in a specified sequence, apply in given circumstances. For example, the calculation schema determines Which condition
types apply to the gross price. The calculation schema also determines that the condition types for discounts are calculated in the effective price automatically.
With SAP MM Customizing, you can define price calculation schemas for specific vendors and/or purchasing organizations. The system searches for pricing data in condition records. The criteria it uses in the search depend on the keys in the condition table. The sequence of the search depends on the access sequence specified for the condition type. Which condition types are used in the search are defined in the calculation schema.
For example, suppose that you have just created an info record that specifies a 10% discount from the gross price. This
condition is then stored in a condition record under the vendor and material number. When the material is ordered from the vendor in a PO, the system searches for the discount using the access sequence. The calculation schema ensures that the 10% discount is deducted from the gross price instead of the net price during the price calculation process.
The different ways of maintaining master conditions, you can maintain conditions in the following ways:
Prices, As this method you can list or maintain the conditions that determine the net price in a single info record or contract. You can enter the going market price for a material.
Discounts and surcharges, As this method, you can enter discounts or surcharges that apply to all info records or contracts meeting your pricing criteria.
Other condition types, If your company has defined its own condition types, access sequences, and condition tables, you can define master conditions that use these pricing elements.
Price changes, You can change pricing by a fixed amount globally.
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