Material Determination - SAP SD

Material determination (also called material substitution) is a technique provided by SAP to allow you to substitute one material for another during the processing of a sales cycle. The technique is really useful for providing solutions for a variety of day to day business requirements that demand material substitutions. Here are a few real-world examples:

  • Replacing an obsolete/discontinued material with a new ff one so as to avoid entering an order that erroneously commits the enterprise to sell a discontinued material to the customer
  • Automatically substituting the agreed-upon alternative material in an order when the original ordered material is out of stock
  • Supplying specially packaged versions of the original material during holiday seasons such as Christmas or Thanksgiving
  • Executing a sales promotion in which you want to enclose flyers or promotional materials along with the materials ordered by the customers

You can use material determination to automatically substitute one material for another or to propose a list of alternative materials for the user to select among. Further, the substitute material either can replace the original material on the main order line or can be added as a subitem to the original material in the order. With material determination, not only can you substitute the materials, but you can also check the stock availability for the original or substitute material and control whether the shortage is to be transferred to the MRP for the original or for the substitute materials.

Material determination and automatic product selection make a great combination. With this combination, you can replace the materials and can also check whether the customer has agreed to the replacement. You achieve this using the product attributes fields available in the customer and material master records. In the following sections, we’ll cover material determination in detail, including automatic product selection. But before we move ahead, we’ll talk about how to maintain material determination records.

Maintaining Material Determination Records

You maintain the material determination record by using transaction code VB11 or by following the SAP Easy Access menu path Logistics ➢ Sales And Distribution ➢ Master Data ➢ Products ➢ Material Determination ➢ Create. the material determination overview screen. To maintain the material determination record, choose the key combination for which you would like to maintain the material substitution. In our example, it is A001, which stands for the material substitution based on the material number.

Overview screen for maintaining a material determination record

Overview screen for maintaining a material determination record

Now press the Enter key on the keyboard to go to the detailed maintenance screen . Here, you maintain the original material on the left in the MatEntered column and enter its substitute on the right in the Material column. Enter a reason for the substitution in the Reason column, and enter a validity date for your material substitution record. A substitution reason controls the overall substitution process, including whether the substitution will be automatic or manual and whether it will include an ATP check. We will cover in detail the reasons for substitution, along with the customization setup for material determination, later in this chapter. The material determination functionality also allows you to maintain more than one substitute in your material record. If you see the check box in the Alternative Materials column selected for your substitution entry, this means that more than one substitute material has been maintained for the entered material, as is the case here.

Fast Entry screen for maintaining a material determination record

Fast Entry screen for maintaining a material determination record

This is really helpful in situations such as material substitution for stock shortages, because you can maintain all the alternative materials in the required prioritized sequence in the VB11 record. The SAP system then replaces the original material on the order with the next available material alternative in stock.

To enable this functionality, double-click the required substitution entry line while you are on the screen. You will be provided with the screen. Here you can maintain all the alternative materials in the sequence in which you want them to be determined in the sales order. Since substitution reason 0006 is configured to perform an ATP check, when the stock is insufficient for material 1599, SAP will first allocate all the available stock from 1599 to the order and will then allocate the available stock from alternative materials 1618 and 1619, respectively.

Maintaining multiple alternatives

Maintaining multiple alternatives

The checkbox shown in MRP Ind. column on this Fast Entry screen plays a vital role in controlling the transfer of material shortage to SAP’s planning application. when the MRP Ind. box was selected for material 1619, the shortfall for three quantities after the successful substitution run was reported for material 1619, but when the MRP Ind. check was removedthe shortage of three quantities was instead reported for material 1599.

Example showing use of MRP indicator

Example showing use of MRP indicator

This setup can also be useful for clearance situations when you would like to sell off all the available inventory of a material you are planning to discontinue in the near future and start replacing it thereafter with a new material. By creating the setup, you tell SAP that if an order comes for material X, it should first deplete the available stock for material X and then start substituting alternative material X1. During this process, if any shortfall is encountered, transfer it to planning for the alternate material X1.

Now we have covered the benefits of material determination in SD and how to maintain the condition record for material substitution, let’s move forward and take a look at the customization settings required to set up the material determination in the SAP system.

Deciding the Scope of Customization

Before you start customizing the material determination, it is necessary that you know the scope of substitution, and you also should be able to evaluate the complete end-to-end substitution process. Answering the following questions will help you determine the scope of customization:

What is the purpose of the Material Determination? Do you need material determination to offer an additional subitem to the main item, such as discount coupons, promotional flyers and so on, or do you need material determination to perform material substitution for the main item in the sales document, such as a new material substituted for a discontinued material?

How is the substitute product going to be determined? This question points to the determination rule. Will you need to substitute products according to the material entered into the order, the material group, or any other material attribute? This helps you decide the fields you need to include into your condition tables.

Is it possible to use an existing setup, or do you need to create a new one?

Standard SAP provides substitution condition type A001, item category TAPS, TAX along with schedule line category CX, and PP to handle the material determination in orders. Before you set up your new customization entry, always make sure to check whether this existing setup, as available out of the box in standard SAP, is appropriate for your business requirements.

For what scenarios can a substitute be offered, how many and in what priority can substitutes be offered, and for which material is the shortage to be reported? Recall the discussions related to and check if you need that kind of setup.

Is there any seasonal or time factor involved in substitution? For example, material X might be substituted for by its specially packaged holiday version (material Y) during the Christmas season, whereas for the rest of the year, the substitute might be alternate material Z.

Do you need to configure the product attributes? In cases where your customers are picky about the substitute material, you may want to configure the product attributes so as to consider customer consent before substituting the material on the order document.

What material number will you print on documents such as order confirmations, deliveries, invoices, and so on? Will it be the number of the original product, the substituted product, or both?

How is the pricing performed during product substitution? Will the prices be based on the original material or on the substituted material?

Case Study: Galaxy Musical Instruments Configuration Analysis: Material Determination, Scope Finalization

Galaxy Musical Instruments required the ability to substitute a material for the purposes of promotions, responding to stock shortages, and as a standard replacement for discontinued or to be discontinued materials. This determination needed to occur automatically based on the material number entered into the customer order. Galaxy further required that the pricing for the original material would prevail even after the substitution, but both the substitute and original materials were to be shown on the output documents. After analyzing these requirements against the available out-of box setup for the material determination, we concluded that material determination A001 serves Galaxy’s purpose, and therefore we did not need to create a new setup. A001 maintenance, when used along with substitution reasons, allows substitution in the case of shortages, promotions, and so on, based on the material number entered into the order, without disturbing the original material pricing.

Customizing the Material Determination

Customization for a material determination is based on the condition technique. You start with setting up the determination using the condition technique followed by defining the substitution rules. You then also perform item categories and schedule line categories setup, provided if standard item categories TAPS and TAX along with schedule line category CX and PP are not sufficient to cater to your business requirement. Since we've discussed the condition technique in detail in earlier chapters of this book and applied it a number of times while configuring various basic functions such as pricing determination, partner determination, text determination, and output determination, we will just summarize the material determination customization and focus on substitution rules customization.

Follow the steps in the next sections to customize the material determination setup.

Step 1: Set Up a Condition Table for Material Determination

To create your own material determination key combination/condition table, follow menu path IMG ➢ Sales And Distribution ➢ Basic Functions ➢ Material Determination ➢ Maintain Prerequisites For Material Determination. The menu path will take you to a Choose Activity screen listing the steps for setting up material determination using the condition technique. Select the activity for Create Condition Tables from this screen to setup your own condition table. Alternatively, you can use transaction code OV16 to call the customization screen. You can use numbers greater than 500 in your condition table, or you can leave the condition table number field blank, in which case SAP automatically assigns the next available number from the customer namespace (501 and above) to your condition table. Select the required fields as per your business requirement from the field catalog, and generate and save the table.

Step 2: Set Up the Access Sequence

To create your own access sequence, use transaction code OV11, or choose the activity for Maintain Access Sequences from the Choose Activity screen.

  1. Create your own access sequence by providing a four-character identification key along with a meaningful description.
  2. Assign the condition tables you created earlier to your access sequence in the sequence of the most specific to the least specific or generic condition.
  3. Maintain any requirements that you want to assign to your access sequence.
  4. Generate your access sequence using the Utilities button available on the access sequence overview screen.

this customization setup for access sequence A001 that is available in the standard SAP system for the material determination. Both access sequences A001 and A002 are available in standard SAP system for the material determination.

Adding Fields to the Field Catalog

If some fields that you want for your condition table do not exist in the field catalog, you can add them using the following steps:

  1. Add the new fields to the KOMKDZ (header) and KOMPDZ (item) structures.
  2. Add these new fields to the field catalog via transaction OV26 or using the activity for Maintain Field Catalog from the Choose Activity screen.
  3. Use USEREXIT _MOVE _FIELD _TO _KOMKD (header fields) and USEREXIT _ MOVE _FIELD _TO _KOMPD (item fields) from “include MV45AFZZ” to provide values to new fields during sales order processing. Remember that for step 1 and step 3, you will need an ABAP resource.

Defining access sequences

Defining access sequences

Assigning condition tables to access sequence

Assigning condition tables to access sequence

Assigning data source for condition table fields

Assigning data source for condition table fields

Set Up Material Determination Types

Use transaction code OV12 to create your own material determination condition types or choose the activity for Define Condition Types from the Choose Activity screen. Here’s how to create your own material determination type:

  1. Provide a four-character identification key along with a meaningful description for your material determination condition type.
  2. Assign the access sequence you created in the “Step 2: Set Up the Access Sequence” section to your condition type. You can even set up validity rules for your condition type that can control the condition record validity. the customization setup for condition type A001 that is provided in the standard SAP system for the material determination.

Defining condition types

Defining condition types

Step 3: Maintain the Material Determination Procedure
To define your own determination procedure, use transaction code OV13 or choose the activity for Maintain Determination Procedures from the Choose Activity screen.

  1. Provide a six-character identification key along with a meaningful description for your determination procedure.
  2. Assign the condition type you created to your procedure.

this customization setup for procedure A000001 that is available in the standard SAP system for the material determination.

Defining a determination procedure

Defining a determination procedure

Step 4: Assign the Material Determination Procedure to Sales Document Types
Now assign the material determination procedure you have created to all the sales document types that will make use of material determination technique for material substitution.

To reach this customization screen, you can use transaction code OV14 or follow menu path IMG ➢ Sales And Distribution ➢ Basic Functions ➢ Material Determination ➢ Assign Procedures To Sales Document Types.

Assigning a material determination procedure to sales document types

Assigning a material determination procedure to sales document types

Step 5: Create the Substitution ReasonsSubstitution rules control the material substitution process. You can define a substitution reason via transaction code OVRQ or menu path IMG ➢ Sales And Distribution ➢ Basic Functions ➢ Material Determination ➢ Define Substitution Reasons.

To create your own substitution reason, enter a four -character identification key along with a meaningful description, followed by making the required selections in the controlling fields.

Creating substitution reasons

Creating substitution reasons

Substitution Reason The column SbstReason contains the four-character identification key for the substitution reason.

Description The column Description contains a meaningful description for this substitution reason, with the maximum field length being 20.

Entry check box This check box controls the printing of the material number on the output form during output processing. When selected, SAP prints original material and its description on the output such as invoices, order confirmations, and so on.

Warning check box This check box provides a warning to the user before substituting a material. This warning works only for manual substitutions, not for automatic ones.

Strategy This field defines the substitution strategy. If you leave the value in this field blank, substitution is automatic. When the value is A, substitute products are displayed to the user for making a selection. At this time, an ATP check is also performed by the SAP system. Selection value B is similar to A but with no ATP check.

Outcome This field controls whether the substitute material should replace the original material entry in the sales order or should be created as a sub item of the original entry. When the value in this field is blank, the items are replaced. When the value is A, the substitution products are displayed as sub items. Value B acts like A but applies only when creating items in sales orders. To help you understand the importance of the Strategy and Outcome fields the nine possible combinations for values in these fields that can be used to set up a substitution reason and also explains what impact these nine combinations will have on the order document and the situations where you can use them.

Possible Substitution Combinations and Result

Possible Substitution Combinations and Result

Substitution Category This field is used only for service orders. When you select A in this field, the serviceable equipment on the service order gets replaced with the service product, thus allowing pricing to happen at the service product level and not at the serviceable equipment level.

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