Basic of SAP SD & its Organizational Structure


SAP SD (Sales and Distribution) is one of the major modules of SAP ERP. It is used to store the product data and customer of an organization. SAP SD manages billing, shipping, selling and transportation of products and services of a firm.

The SAP Logistics module is responsible for management of customer relationship starting from quotation to sales order and billing of the product. This module is closely integrated with other modules like SAP MM and PP. This is an introductory tutorial that covers the basics of SAP SD and how to deal with its various modules and sub-modules.

Key Components in SAP SD

The key components in SAP Sales and Distribution module are −

  • Sales Support
  • Customer and Vendor Master Data
  • Sales Activities
  • Shipping of Material
  • Transportation of products
  • Billing related
  • Contract Handling and Management
  • Credit Management
  • Information System
  • Foreign Trade

SAP SD – Organizational Structure

SAP SD Organizational structure

SAP SD Organizational structure

SAP provides many modules to complete SAP Sales and Distribution organizational structure like Distribution Channels, Sales Areas, and Divisions.

The SAP SD organization structure majorly consists of these steps −

  • Establishment of Organization elements in SAP system
  • Link each element as per requirement

On top of this organization structure in the SD segment, sales organization is at highest level and is responsible for distribution of services and goods. SAP recommends to keep the number of sales organization in an organizational structure to be least. This will make the reporting process easy and ideally it should have a single sales organization.

The second level is distribution channel, which says the medium by which the products and services are distributed by an organization to its end users.

A sales area is known as object, which is required to process an order in a company. It includes sales organization, distribution channel and a division.

SAP SD organizational structure, each sales organization is assigned to a company code. The distribution channel and divisions are assigned to sales organization and all of these comprise to make a sales area.

In the SD organizational structure, sales organization is assigned to a company code and then is to define a distribution channel and then division to a sales organization.