Introduction

SAP organization units and their equivalence with real-world organizations

Client

It refers to the corporative organization. Data belonging to this level applies to the rest of the organization.

Company

It applies to companies and subsidiaries belonging to the organization. This level defines its own data and financial statements.

Plant

It applies to factories mainly, but also can apply to maintenance plants, procurement premises, and retail or wholesale sites.

Purchasing Organization

It corresponds to a regular purchasing organization that procures materials and services, and negotiates conditions of purchase with vendors. A purchasing organization can be defined to serve all the companies of the corporate group; it can be defied to serve just one company, or to serve just one plant.

SAP defines also “reference” purchasing organizations to allow a company to use other company’s purchasing organization to get better deals.

Sale Organization

Corresponds to the same concept in business. In SAP a SO is responsible for selling materials and services, and is assigned to a company.

A sales organization can be subdivided into several distribution chains which determine the responsibility for a distribution channel.

Several divisions can be assigned to a sales organization which is responsible for the materials or services provided.

A sales area determines the distribution channel used by a sales organization to sell a division’s products

Storage location

It corresponds to a real-life warehouse.

Warehouse number

Organization unit relevant only when using the WM system, it is defined as a complex warehousing system consistent of several storage areas.

When using the WM system, only one storage location in the company can have a Warehouse number assigned. All the stock of that storage location will be managed using the WM system.

Storage type

Relevant only when using the WM system, it is a storage area within the warehousing system. Typical examples are Goods receipt area; Goods issue area, picking area, and High rack storage area.

Several physical warehouses can be managed as storage types under a warehouse number. One storage type groups together several storage bins.

Distribution Channel

The distribution channel represents the channel through which salable materials or services reach customers. Typical distribution channels include wholesale, retail and direct sales.

Division

In the SAP R/3 System you can define a division-specific sales organization. Product groups, i.e. divisions, can be defined for a wide-ranging spectrum of products.

For every division you can make customer-specific agreements on, for example, partial deliveries, pricing and terms of payment. Within a division you can carry out statistical analyses or set up separate marketing procedures.

Sales office

Geographical aspects of the organization in business development and sales are defined using the term sales office. A sales office can be considered as a subsidiary created to develop businesses in a specific geographical area. A sales office establishes contact between the firm and the regional market. An example would be a branch of a firm in Hamburg, Main Street 1.

Sales group

The staff of a sales office may be subdivided into sales groups. For example, sales groups can be defined for individual divisions.

Salespersons

You can maintain personnel master records for sales representatives in your company. In the personnel master record, you assign the salesperson to the sales office and the sales group. You can also enter the system user name of the sales person. This allows mails to be sent to the salesperson (define the partner function for sales personnel in the sales document).

Shipping point

It is an organizational entity responsible for scheduling and processing deliveries to customers, as well as replenishment deliveries to your own warehouses. A delivery is always carried out by one shipping point only. The shipping point depends on the following criteria:

• Delivering plant
  
• Type of shipping (for example, train, truck)
  
• Loading equipment necessary
  
  

Loading Point

Shipping points can be subdivided into loading points. For example, ramp 1, ramp 2 and ramp 3 belong to the shipping point Forwarding depot.

Transportation Planning Point

The transportation planning point is an organizational unit in Logistics, responsible for planning and processing transportation activities.

It organizes the responsibilities in a company, e.g. according to shipment type, mode of transport or regional departments.