In Focus

Sales and Profit Planning

General Demands on Sales and Profit Planning

Sales and Profit Planning is

part of the SAP R/3 Systems Profitability Analysis
application. Sales and Profit Planning enables you to
plan your sales and profits
effectively, on the basis of
an intuitive planning concept and a state-of-the-art,
graphical user-interface.
Sales and Profit Planning
helps you to concentrate
your efforts, for example
on profitable customer
groups, products and sales
organizations, by supporting an integrated as well as
a decentralized planning
process.

Sales and profit planning typically requires a comprehensive planning process, which consolidates the knowledge of sales management on future sales
quantities, the knowledge of marketing on future prices and rebates as well
as the knowledge of accounting on the anticipated development of costs to
form an overall picture of future profit.
Accordingly, most companies go through a sequence of steps to collate
planning data across organizations and business units. For example, actual
or former planning data is copied, extrapolated or revaluated for the future
in order to create a plan proposal. Furthermore decentralized manual data
entries are made and integrated into profit planning.
Often, sales and profit planning is an integrative and iterative process, in
which various roles within Profitability Controlling are involved, such as
the Sales Director, Regional Manager and Sales representative. According to
the various roles involved in the planning process, you can distinguish different planning approaches, for example centralized top-down planning and
decentralized bottom-up planning. The levels and contents of the individual
plans vary depending on the depicted approaches.
By reflecting a typical sales and profit planning process in the above way,
you can derive the following demands on a planning tool which is to perform professionally:
Flexible determination of planning levels and content
Personalization of individual planning tasks

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Diversity of relevant planning

functions such as valuations and
simulations
Excel Integration
Web-enabled Planning
Wide-range integration with other
plans such as cost center planning
and order planning.
The planning tool in Profitability
Analysis is based on an intuitive planning concept, which reflects exactly
these demands.

The Concept of Sales and Profit

Planning
Central to Sales and Profit Planning
is a well-defined and organized
planning process. The initial screen
of the planning tool in Profitability
Analysis supports you in organizing
your individual planning process by
using only three basic elements:

Planning levels
Planning packages
Planning methods

Different decision-makers plan at

different planning levels. These planning levels are used to specify the
desired dimensions to be applied in
planning. Planning levels are represented by combinations of characteristics. For central top-down planning
of goals by the Sales Director, for
example, the planning level Sales
Organization, Distribution Channel
and Product group could be of interest. Whereas, decentralized bottom-up
planning by sales representatives
would be carried out at the Customer
group and Product level.
In order to determine the detailed
planning objects and to assign these
to the relevant planners, you define
various planning packages for each
planning level. For example, central
top-down planning is carried out
separately for the individual sales
organizations. Decentralized bottomup planning, on the other hand, is
carried out by the individual sales
representatives. In this case, a planning package would be created for
each employee whereby each employees package would contain only his/
her customer groups and articles.

Planning levels and planning packages allow you to:

Structure your planning process
Personalize your work packages
Keep track of the individual steps
of your planning process
A comprehensive toolbox of planning methods is available to allow
you to create and edit planning
data. These not only include simple
functions, such as manual entry of
planning data, but also include more
complex ones, such as the automated copy, revaluation and extrapolation of the previous years planning
data and actual data, and the automated top-down distribution of
high-level planning data to a more
detailed planning level.
With Sales and Profit Planning,
quantity and price planning as well
as simulations using a goal-seek
function can be carried out easily.
To allow sales representatives to
create their sales planning data
locally, Microsoft Excel is integrated
with Sales and Profitability Planning. This allows you to use Excel
functions such as those for additional calculations, graphics and printing, while the R/3 System ensures
the consistency of the data centrally,
providing functions such as derivation and valuation.

Web-Enabled Planning
The easy web planning transaction
allows you to offer your sales force
flexible access to custom planning
screens.
A straight-forward interface streamlines their planning tasks, thus enabling them to focus on the sales job.
Planning data entered with the easy
web planning transaction is posted
remotely to the R/3 System and
guarantees a consistent database
with full validation against R/3
master data and access to valuation
functions.

Integrated Planning
To improve your sales and profit
planning further still, you can enhance your sales and profit plans by
transferring planning data between
Sales and Profit Planning and the
following applications:
Cost Center Planning
Planning of internal orders and
projects
SAP Business Information Warehouse (SAP BW)
Advanced Planner and Optimizer
(APO)
Profit Center Accounting

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