The use of an alphanumeric sequence of characters that serves to group materials by combining different characteristics and is used for evaluations and pricing is called a product hierarchy in SAP.
We access Base data 1 of the material master and we have the field located on this screen:
Using the Product Hierarchy in SAP
The hierarchy in the basic data screen is used to represent competitor materials from competitor 2 to competitor 2. The company itself is considered a competitor, and the materials themselves are considered competitor materials. Market analyses can be performed from this.
Procedure
Generally, competitor materials are recorded using the WETT material class. If you record your own materials as competition materials, a hierarchy of other material classes can be displayed on the basic data screen.
Dependencies
In the above case the following points should be considered:
•If materials have been created at the sales organization level, a warning is displayed on the master data screen indicating that a different SAP hierarchy exists at the sales organization level.
•When creating new records at the sales organization level, the product hierarchy from the basic data screen is proposed.
The parameterization of the hierarchies is done in the SPRO.
We have to follow this route to access it:
In this IMG activity, you will define product hierarchies that you can use, for example, for statistical evaluations and pricing, or modify their structure. The hierarchy groups materials by combining several characteristics. Each characteristic is reproduced at a level of the hierarchy.
Using a matchcode, you can perform a selective search for material master records in the hierarchy.
Check which SAP product hierarchy exists in your company and align it with the SAP system's representation capabilities.
- Assign the individual levels of your hierarchy a characteristic feature: on the 1st and 2nd levels respectively a characteristic feature of 5 characters, on the 3rd level one of 8. The number of levels is determined automatically.
In total, there is a maximum of one 18-character characteristic feature for a node in the product hierarchy in SAP. - Enter a textual name for the hierarchy.
As an example we have a list of foods with level 1: 0001 Foods
As level 2. Gluten-free foods: 0002 Gluten-free
As level 3 we have a Macaroni pasta: level 3 0001 Macaroni.
The result of that field would be 000100020001. We would insert that code into the indicated field of the material master, leaving it assigned with that identifier. Different materials can have that hierarchy assigned. All of this corresponds to the business organization. There can be multiple records.
In conclusion, the product hierarchy is a fundamental tool for organizing and classifying materials, allowing for better structuring of information and facilitating processes such as price evaluation and market analysis. Properly parameterizing it in the SPRO ensures that materials are adequately represented in the system, aligning with the company's needs. By defining hierarchy levels and assigning alphanumeric codes, more efficient and standardized product management is achieved within the organization.
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