Home | ERP Applications without HCM | Vendor Fund Processing | Trade Price Specification Contract
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| Software Component Version | ESM ERP 606 |
| Technical Name | TradePriceSpecificationContract |
| Business Object Type | Business Process Object |
The Trade Price Specification Contract business object provides B2B interfaces to receive incoming price agreements from a third-party system and create a trade price specification contract in an SAP ERP back-end system. A trade price specification contract can be implemented between 2 or even 3 parties (vendor, customer, and wholesale distributor). It assigns pricing conditions to the party granting the conditions (normally a vendor) and to a number of eligible partners to whom these pricing conditions apply, for example, customer groups.
The chargeback process is commonly used, but there are also many other variants in the business world.
In the chargeback process, a wholesale distributor is compensated by his supplier (manufacturer) for the (logistical) services he or she has provided for the supplier’s customer. The cost of these services is based on an agreement that was directly negotiated between the supplier and the supplier’s customer. The figure below shows the relationship between the 3 parties involved:
Chargeback Process: 3-Party Relationship Between Manufacturer (Supplier), Wholesaler, and Customer
In certain industries, for example, the pharmaceutical industry, important customers or buying groups negotiate special pricing conditions for certain products, which are captured in a contract pricing agreement. A wholesaler providing logistical services must grant these special conditions whenever one of the eligible customers places a sales order for the relevant products. Since the wholesaler obtained the products from the manufacturer at the standard price, the manufacturer must refund part of the purchase price to the wholesaler if the wholesaler sold the products under the special conditions of the contract agreement. Consequently, the chargeback requests the wholesaler sends to the manufacturer are based on the sales orders or rather the related invoice.
A trade price specification contract may not always involve 3 parties. It can also be used to implement 2-sided price agreements between, for example, wholesale distributors and their customers or vendors or between suppliers and wholesale distributors.
If validity dates are specified for the conditions involved, the contract can also be used as a promotion agreement considered in sales contracts.
For more information, see SAP Library for Logistics on SAP Help Portal at http://help.sap.com -> SAP ERP -> SAP ERP Central Component -> Logistics -> Chargeback Management.
To access the condition contract from the SAP Easy Access menu, choose Logistics -> Compensation Management -> Condition Contract .
Condition contract (synomym in SAP Module 'EA-GTM')
Condition contract (synonym in SAP Module EA-GTM)
B2B and A2A related information:
The back-end systems involved are an SAP ERP system and a third-party contract processing system.
