Manage Pricing Discrepancies on Sales Orders Received via EDI
- by Anton Karnaukhov, Senior IT Manager, Pacific Coast Companies, Inc.
- May 1, 2006
When it comes to receiving sales orders electronically, it is crucial to maintain total control over pricing. Here’s how.
Electronic Data Interchange (EDI) is the exchange of electronic data between business partners who use a number of different hardware and software solutions. The exchange can involve documents such as sales orders, invoices, and advanced shipping notices. The data exchanged is always formatted according to predefined standards. In the United States, the most widely used EDI standard ASC X12 is coordinated by the American National Standards Institute (ANSI). Use ANSI X12 transaction set 850 and SAP IDoc type ORDERS01 for incoming sales orders.
It is no wonder that almost every company that uses
SAP R/3 or ERP Central Component (ECC) today has
one or more Electronic Data Interchange (EDI) implementations
in place. EDI not only provides an inexpensive way
of exchanging data with various business partners,
but also streamlines the monitoring and controlling
of incoming and outgoing documents.
Certain EDI transactions require you to use more
control methods because of their direct impact on
your company’s revenue. For example, incoming
sales orders are often subject to pricing disputes.
Automated EDI sales orders with incorrect pricing,
if not checked, could cause a lot of turmoil. The
company could end up in a situation in which customers
are refusing to pay the invoices or, even worse,
experience a loss of loyal customers all due to the
lack of monitoring and controlling of price discrepancies
on incoming sales documents.
As more and more sales orders are received
via EDI, it is vital to ensure that all
expected incoming pricing is checked
against the sales and distribution pricing
maintained in your R/3 or ECC system.
They both provide standard functionality
to help you identify pricing discrepancies
between the customer’s expected
sales price and the sales price your
system determines on incoming EDI sales
The steps below guide you through the
process of configuring R/3 to capture
the customer’s expected price on
incoming EDI sales orders and check that
price against a customizable factor of
deviation from the actual sales price
as determined by the Sales and Distribution
(SD) module of R/3. You will also gain
an understanding of how to block an incoming
sales order from further processing if
the price discrepancy is unacceptable,
and find out how to access standard reporting
tools that allow the release of blocked
EDI sales orders within your system.
Although my example is from an R/3 system,
the process is the same for ECC.
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