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Overview of SAP SD (Sales and Distribution)

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SAP ERP’s Sales and Distribution (SD) module is integral to handling sales and logistics, providing essential support from quotation phases, order placement, to billing stages. It empowers organizations to effectively manage and preserve customer and product information, which is pivotal for overseeing sales orders, delivery, billing, and invoicing procedures. IQST is one of the best SAP SD online training providers with industry experts helping the students learn new concepts with industry application focus.

SAP SD stands as a crucial component of the SAP ERP suite, encapsulating necessary business operations for the sale, distribution, and billing of products. Integrated closely with modules like SAP MM and SAP PP, SAP SD’s major sub-modules include the management of Customer and Vendor Master Data, Sales, Delivery, Billing, Pricing, and Credit Management.

Key Concepts of SD

SAP’s SD module is among the most vital, covering a broad range of functionalities:

  • Master Data
  • Sales
  • Shipping
  • Transportation
  • Sales Support
  • Billing
  • Foreign Trade

Master Data

Transactions are meticulously tracked within the system by the end-user, with SD master data encompassing details on customers and materials, price conditions, and credit management, including order-to-cash processes.


This module keeps a record of everything from customer and product details, pricing, feedback to the entire sales activity.


Tightly linked with the sales, shipping ensures products are correctly delivered to customers, documenting the full journey from shipping to delivery or possible return.


Working in tandem with the shipping module, it oversees the delivery methods, whether by courier or manual delivery, monitoring the process thoroughly.

Sales Support

This segment captures the interaction between the sales team and customers, from product sales to ongoing maintenance, recording all exchanged information during product support.


A significant phase within sales, where various payment methods like online card payments, cash on delivery, or PayPal are processed.

Foreign Trade

Aids departments in managing data concerning international trade, including both imports and exports.

Enterprise Structure in SAP Sales & Distribution


Defined in the Finance (FI) module, the Company Code is linked to the SD module, signifying a legally independent entity required to keep a Balance Sheet and Profit & Loss Statement.


At the organization’s apex, it oversees sales activities and strategies to amplify market presence, handling customer complaints and queries.


Refers to the strategies employed to penetrate the market with products or services, reaching customers through various channels like wholesale, retail, or online sales.


Groups goods or services sharing common characteristics, representing different product lines within a sale.


A combination of Sales Organization, Distribution Channel, and Division, it outlines specific sales strategies and market reach.


Varies across different logistics modules but generally refers to the location where goods are produced or distributed.


Associated with a Plant, it’s where inventory is stored, varying based on its nature like raw materials or finished goods.


Essential for product delivery to customers, it’s linked to a Plant which could have multiple Shipping Points depending on dispatch needs.


Apart from the main office, Sales Offices are strategically placed to deepen market penetration, acting as a liaison between the headquarters and customers.


Associated with Sales Offices, these are teams designated to specific geographical areas.

Process of Sales and Distribution (SD)

1. Presales Activity

    Involves gathering and creating master records for potential or existing customers, engaging with sales prospects through inquiries or quotations, and recording sales-related data for evaluation and order conversion.

2. Sales Order Processing

    Begins with capturing the actual sales order, incorporating customer details, product, pricing, and delivery information, ensuring material availability and prompting procurement as necessary.

3. Delivery Processing

    On the designated shipping date, delivery documents are prepared, detailing the picking, packing, and loading processes in Warehouse Management, with the goods issue posting marking the completion of this step.

4. Invoicing and Revenue Recognition and Reporting

    Concludes with sending a billing document or invoice to the customer for payment, with account determinations updating the SAP General Ledger and financial records to reflect the sale.

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