Business Process

Confirmation Document

Lakshya_SA_BPC_SD-05C B2B
ES SPAR
Project - Lakshya
 Table of Contents
Contents:

1.Document Control Information

1.1 Document Information

Document Identification Lakshya_SA_BPC_SD-05C B2B Franchisee SOA
Document Name Business Process Confirmation Document
Project Name Project Lakshya
Client Landmark Group
Document Author Rohit Goel
Document Version 1.0
Document Status DRAFT
 Date Released

1.2 Document Edit History

Version Date Additions/Modifications Prepared/Revised by
V0.1 9-Jan-2024 Initial Draft Ramki Rajamanikam
V0.2 5-Dec-2023 LMIT Team Review

1.3 Document Review History

Date Reviewer Role Review Status
TBD Ranjitha Krishnamurthy Group Reviewer
TBD Murali Cherikuri Group Reviewer
TBD Venketesh Kulkarni Group Reviewer
TBD Anand Krishnamurthy Lifestyle Reviewer
TBD Saravana Kumar Lifestyle Reviewer
TBD Rajesh Kannah Lifestyle Reviewer
TBD Akanksha Kumar Max Reviewer
TBD Ashish kumar Singh Max Reviewer
TBD Balakrishna K Max Reviewer
TBD Ganesh Todkar Max Reviewer
TBD Vasanth Kumar Thimmappa Max Reviewer
TBD Damoo P Home Centre Reviewer
TBD Rameshwar Miniyar LS LMIT Reviewer
TBD Chalapathi K Easy Buy Reviewer
TBD Vijay Vikram Easy buy Reviewer
TBD Sumit Goenka IT Reviewer
TBD Gurpreet Saini IT Reviewer
TBD Suresh Babu IT Reviewer
TBD Manoj Mishra Audit
TBD Balasubramanyam V Audit

1.4 Document Approval History

The following people are designated recipients of the final version of this document:

Date Approver Role Signature

TBD Jitendra Mangave LMIT Approver
TBD Viswanath KR Lifestyle Approver
TBD Ajeet Kumar Jha Home Centre Approver
TBD Rajshekhar Rao Max Approver
TBD Meenakshi N Easy buy Approver
2. EB-SPAR Process AS-IS
2.1 Introduction
The Business Model between Easy Buy (EB)/MAX and SPAR is Franchisee SOR/Outright Model. The
SPAR locations which are created in LSIPL RMS system are 1004 format i.e., Franchisee SOR Not
Integrated.
In normal Franchisee SOR Not Integrated model of business, once goods are shipped from LMG
warehouse/store, B2B invoice will be generated and there will not be any visibility in LSIPL RMS
about the actual receipt at the Franchisee location.
Since SPAR is a LMG company and using the Oracle RMS system which is a separate instance (i.e.,
SPAR and LISPL using two different Oracle RMS), Business wants an integration between LSIPL RMS
system and SPAR RMS System for the master data and the transactions created between EB/Max
and SPAR.
Custom integrations (viz., Master Data (i.e., Item, Item-MRP, Store, Item-Tax) and transactional
data)
have been built to sync the data between LSIPL and SPAR.

Note: SO/TO can be created and shipped at the Pack item level but the staging and Invoice should
be created at the component level. The Qtys and values to be prorated as per pack component
ratio.
SPAR B2C Sales will be loaded in LSIPL for stock update and replenishment purposes and not for
any financial postings against these B2C sales.

2.2 Master Data creation/maintenance

1. Finalization of Related Commercials – (Registration under GST for customer as
Franchisee)
2. Additional Place of Business to be obtained by LM for respective OUs at Franchisee
Location.
3. Customer Creation for Franchisee – (Initiated by Commercial & business Department of
respective OUs)
4. Store format (Location Master) Creation for Franchisee - (Initiated by business &
Commercial Department of respective OUs)
 5. Margin Configuration at Store/customer level periodically (Monthly/Quarterly/Yearly).
6. Mapping of customer to store (at any point of time, one store will have only one active
customer.)

2.3 Stock Movement steps

Stock movement is initiated from LM team from LM to Franchisee location. There is no financial
posting (except interstate movement taxes) that happens in ERP.

I. From Warehouse to Store

Inter-State Intra-State
Respective OU planners will initiate TO Respective OU planners will initiate TO

Against every TO, tax invoice will be generated
For every tax invoice, E-Invoices and E-Way bills will be
generated at the back end - via CYGNET platform. GST
applicable
Physical movement of stock will happen
Against every TO, STN will be generated
For every STN, an E-Way bill will be generated
at the back end - via CYGNET platform. GST
not applicable
Physical movement of stock will happen

II. From Store to Warehouse (in case of return)

Inter-State Intra-State
Respective OU planners will initiate return request Respective OU planners will initiate return
request
Against every return request, tax invoice will be Against every return request, STN will be
generated generated
For every tax invoice, E-Invoices and E-Way bills will be For every STN, an E-Way bill will be generated
generated at the back end - via CYGNET platform. GST at the back end - via CYGNET platform. GST
applicable not applicable
Physical movement of stock will happen Physical movement of stock will happen

III. From Store (Virtual) to Store

Inter-State Intra-State
Respective OU planners will initiate TO Respective OU planners will initiate TO

Against every TO, tax invoice will be generated
For every tax invoice, E-Invoices and E-Way bills will be
generated at the back end - via CYGNET platform. GST
applicable
Physical movement of stock will happen
Against every TO, STN will be generated
For every STN, an E-Way bill will be generated
at the back end - via CYGNET platform. GST
not applicable
Physical movement of stock will happen
For other Brands:

I. From Vendor to Store

Inter-State Intra-State
Respective OU planners will initiate PO from LM (APOB) Respective OU planners will initiate PO from
to Vendor LM (APOB) to Vendor

Against every PO, tax invoice (with IGST) will be Against every PO, tax invoice (with CGST &
generated by vendor SGST) will be generated by vendor
Physical movement of stock will happen from Vendor Physical movement of stock will happen from
location to store. Vendor location to Store.

II. From Store to Vendor (in case of return)-

Inter-State Intra-State
Respective OU planners will initiate Return request Respective OU planners will initiate Return
from Store to Vendor by using LM GST request from Store to Vendor by using LM
GST

Against every return request, RTV (with IGST) will be
generated to vendor
Against every RTV, E-Invoices and E-Way bill will be
generated
Physical movement of stock will happen from Store to
vendor location
Against every return request, RTV (with CGST
& SGST) will be generated to vendor
Against every RTV, E-Invoices and E-Way bill
will be generated
Physical movement of stock will happen from
Store to vendor location

2.4 POS Sales

1. Franchisee GST will be used for customer billing (B2C)
2. Initial collection for B2C will be by Franchisee. The collection will be transferred to LIPL
on a day-to-day basis via SWEEP Account – Collection posting in AR Module.
3. Based on B2C Sales, B2B invoices will be generated daily and will raise to franchisee –
Financial Posting to AR Module.
4. B2C Sales – No Financial posting in LIPL Books; only data recorded in RMS for
management reporting purposes.

2.5 Franchisee Margin calculation

 1. Based on B2C Sales, B2B invoices will be generated after netting of Franchisee Margin as
agreed upon.
2. Difference between the B2B and B2C sale values will be treated as Franchisee Margin
(Manual calculation.)
3. Based on manual work (Excel), commission will be paid on a monthly basis.
4. Any difference in margin will be adjusted with Financial Debit/Credit Notes with the
impact of GST accounted under ‘Sale Price Differences’

2.6 GST Differential Pay-out

a. All B2B tax invoices from LIPL to Franchisee will be treated as purchase by Franchisee.
b. B2C – Output tax treated as Franchisee’s output against which Franchisee can avail input
tax credit on the above B2B transfers from LIPL treated as purchase.

2.7 Transfer stock from WH to Store (Franchisee SOA)

2.8 Pricing Illustrations

Business model SOA
Additonal placeof business Required
OU Margin 55%
Margin Agreed 20%
Tax Rate 5%
Product MRP 100.00
NOT 95.24
Tax Amount 4.76
Stock Held by Principle

Stock Movement
Primary Movement STN
Product MRP 100.00
Movement price incl.GST 45.00
Cost 42.86
Tax Amount 2.14
Movement value 45.00

Sales B2C
Net of Franchisee
Sales accounted by OU
Margin
Customer Billing GST Franchisee
MRP 100.00
Customer Discount 10%
RRP 90.00
TAX @ 5% 4.29
NOT 85.71

B2B Billing Posting

To Franchisee 68.57
GST 3.43
72.00
Settlement
Commission/Margin share 17.14
Tax -
Sale price difference -
GST Difference only 100% if Collection received by
OU 0.86
Total 18.00

2.9 Accounting Entries

Debit Credit

Franchisee
Debtors Sales -
Franchisee -Location 90 No FI entry in RRP/TENDER/GROSS
B2C Sales - Franchisee B2C Sales 85.71 LIPL or COGS NOT
POS Output Tax 4.29 entry TAX

Bank 90 AR Posting in RRP/TENDER/GROSS

Collections Franchisee - Debtors 90 LIPL RRP/TENDER/GROSS

Franchisee - Debtors 72 LIPL Invoice Value

(MRP/ RRP -
Margin) MRP -
100 Less 20% Franchisee Purchase
B2B Sales - acccounted Sales - Wholesales 68.57 Margin) Cost
in B2B GL code Output Tax 3.43 Input for Franchisee

COGS - Wholesales 42.9

Inventory Accounting Inventory 42.86 Cogs - Inventory

Tax - reimbursement -
(Input tax) 0.86
AP payable to Franchisee - Debtors 17.1
Franchisee Bank 18
3. Franchisee Sale on Approval/Agreement/Concessionaire
(SOA) Process TO-BE
3.1 Introduction
The LM group will establish an agreement with the Franchisee for the sale of merchandise within an
agreed period, based on agreed-upon terms. This agreement will be created (By Business Development
(BD)/commercial team) outside the system and once it is signed, it is proposed to be uploaded (System
still under exploration from LM end). Based on signed agreement, the commercial team will initiate
request to create a site as a store(customer). For the existing customers/site, this process can be
initiated without customer/site creation.

This agreement will encompass details such as sales volume (Value or Qty), turnover cap, minimum
guarantee, sales margins, & other store expense related scope etc. The Franchisee store/site (Addition
place of Business) will have the same GSTIN number as of LM, so no tax invoice will be generated in case
of Intrastate transfers. Only in the case of Interstate, the tax invoice will be needed during the transfer
of stocks from LM to the Franchisee location. The franchise GSTIN (will be maintained in customer
master/BP) number will be used for margin settlements at the end of the month.
Franchisee GSTIN number is used for all B2C Sales. Franchisee B2C POS sales (LM POS), encompassing
both inventory and financial data, from the Franchisee will be reported back to the SAP S4 HANA system
(through the CAR system) at the end of each business day and based on all the B2C transactions during
that day, a B2B invoice will be created from LM and raised to Franchisee after netting of the accrued
margin. The CAR system is going to replace the existing ReSA system. All the B2B sales are accounted for
in LIPL books. Currently, the SOA model is used by Max and Easybuy, but the same can be extended to
other OUs as needed.
The ownership of the stocks always remains with the LM, not the Franchisee until the B2C sales are
realized at the Franchisee location. The Franchisee store is responsible for end-consumer sales (B2C
Sales). LIPL inventory gets reduced at the time of B2B sales posting at the end of the day in S4 HANA. But
real time store inventory visibility will be there in SAP CAR system based on the B2C sales. Depending on
the sales volume and the agreed margin percentage with the Franchisee, the margin amount will be
posted in the Franchisee payable account. The tax differential between B2C and B2B invoice will be paid
back to Franchisee through finance developed custom program. Based on the date range, this
differential GST amount will be posted.
3.2 Master Data creation & maintenance
Create & Maintain Site - A site as a customer will be created for the new Franchisee store. The customer
will be extended to all the Sale Area (OUs) catering to sales transactions. There will be an identifier (Site
Attribute) for identifying whether the store is a Consignment, Franchisee SOA or SOR. The GST number
for Franchisee customer will be maintained in Customer master and the GST number for the Franchisee
Site will be maintained as a site attribute.
Note: Exact Site Attribute or field name will be covered in detail in Master data BPC.

Create & Maintain Pricing Master - Condition records will be maintained in the S4 system for margin,
discounts, and tax conditions. For the MRP, WAC the values will be fetched from article master.

Create & Maintain Condition contract – A condition contract will be created, encompassing details for
agreed Margins (Percentage or Value) at below Levels:
1. Franchisee Customer + Brand + MH (Division, Group, Department, Class &
Subclass)
2. Franchisee Customer + Brand
3. Franchisee Customer

Note: Margin on MRP, RRP and NOT will be addressed using the pricing procedure technique to
calculate the franchise margin.

Create & Maintain Output Master- Output master will be created to forward invoices to BOLT-ON
portal for E-Invoicing. E-mail after generation of E-Invoicing will be triggered to registered E-mails Id’s for
the internal & external Business Partners.

Tax Master-
In SAP, to fetch different tax % values in sales transactions, different condition records need to be
maintained in the system. A condition record is defined as how the system stores the specific condition.
Condition records will be maintained during the data migration phase.

For maintaining different condition record, a condition type needs to be maintained for different tax
conditions. For Example, JOIG for Integrated taxes, JOCG for central tax, JOSG for state taxes.
Each Condition type is assigned to one access sequence. Each Access Sequence contains multiple key
combinations. An access sequence is a search strategy that the system uses to find valid data for a
particular condition type. It determines the sequence in which the system searches for data.

The access sequence consists of one or more accesses. The sequence of the accesses establishes which
condition records have priority over others. The accesses tell the system where to look first, second, and
so on, until it finds a valid condition record.

Condition records for Tax Conditions can be maintained for below key combinations:

Control Code + Tax Classification Customer + Tax Classification Material + Departure Region +
Destination Region

Note: Discussed with LMIT. There are 2 alternate ways to achieve this:
1. To group HSN codes, tax code wise.
2. Article tax classification has six values based on tax codes- 0%, 3%, 5%, 12%, 18%, 28%.
Final decision will be taken during technical build.
 Tax Classification customer – Specifies the tax liability of the customer.
Tax Classification Description
0 Tax exempt
1 Full Tax
2 50% Tax

 Tax Classification material – Specifies the tax liability of the material.

Tax Classification Description
0 Tax exempt
1 Full Tax

 Sending/Receiving region: Will be identified from Site master.

Margin Master-
In SAP, to fetch different Margin % values in sales transactions, different condition records need to be
maintained in the system. A condition record is defined as how the system stores the specific condition.
Condition records will be maintained during the data migration phase.

For maintaining different condition records, a condition type needs to be maintained for margin
conditions. For Example, ZMGN for margins.

Each Condition type is assigned to one access sequence. Each Access Sequence contains multiple key
combinations. An access sequence is a search strategy that the system uses to find valid data for a
particular condition type. It determines the sequence in which the system searches for data.

The access sequence consists of one or more accesses (key combination). The sequence of the accesses
establishes which condition records have priority over others. The accesses tell the system where to
look first, second, and so on, until it finds a valid condition record.
Condition records for Margin Condition can be maintained for below key combinations:

1. Customer + Site+ Brand + MH* (Division, Group, Department, Class & Subclass)
2. Customer + Site+ Brand
3. Customer + Site
4. Customer

Note: The master data creation & maintenance will be covered in detail in Master Data BPCs.

BPC Name: MM-02 Master Data BPC (Site Master)

SD-02 Master Data BPC (Customer Master)
SD-10 Statutory BPC (For Tax Master)

3. Stock Transfer order creation for supply of stocks

For Private labels, a STO order i.e., Stock Transfer Order will be created to transfer the stocks from LM
to Franchisee (Additional Place of Business.)

For Other labels, a PO order i.e., Purchase order will be created to transfer the stocks from Vendor to
the Franchisee location.

 A STO/PO order will be created by the planner in S4 based on the business

requirement.
o This stock transfer from LM or vendor to the Franchisee can involve both
interstate and intrastate movements.
 LM & Franchisee’s store location details will be captured while STO creation. Prices and
tax values will also be captured.
 The inventory for the Stock transfer order (In case of Private Labels) can be sourced
from:
o Landmark Warehouse to Franchisee location.
o LM Store to Franchisee store.
 After STO creation, an outbound delivery document will be generated in S4 for the
supply of goods.
 The stock for the PO order (In case of Other Labels) can be sourced from:
o Vendor to Franchisee Store.

BPC Name (for detailed process): PL_02 Allocation

3.4 Outbound Delivery Creation

 After STO creation, the outbound delivery process initiates to physically transfer stock
from the LM warehouse/Store to the Franchisee location.
 For Other Labels, after creation of PO, vendor will directly ship the goods to the
Franchisee & delivery document will not be created in SAP system.
 An outbound delivery document is generated in S4 against the STO, encompassing
details about the Franchisee location (APOB) address, article information, quantity of goods
to be supplied etc.
  The outbound delivery document from S4 is interfaced to the EWM system to facilitate
logistics activities for shipping the goods to the Franchisee location.
 The stock is picked & packed in the EWM system.
 EWM triggers the PGI (Post Goods Issue) event in S4 system, subsequently, the
outbound delivery document in S4 will be updated. PGI accounting entries will be posted to
Inventory Control account & the stock will be shown as stock in transit/ GIT (Goods in
Transit) at Franchisee location.
 After the PGI is performed, the STN (for Intra-state) or the Tax Invoice (for Inter-state)
will be created against the outbound delivery & will be sent to BOLT-ON portal for E-
Invoicing and E-Way bill.
 The Tax invoice and E-Way Bill will be printed at the warehouse and sent to the
Franchisee location along with the goods.
 Title of ownership of goods at any point of time will remain with LM till B2C Sales.
 Subsequently Goods receipt is performed at the Franchisee location & inventory at
Franchisee location will be adjusted accordingly.

BPC Name (for a detailed process): WA-03 Outbound Process

MM_05A Inventory Inward BPC

3.5 STN/Tax Invoice creation for Stock Transfer Order

The tax invoice process for private labels and other labels will be different in the case of Franchisee SOA.
The stock transfer movement can be Intrastate as well as Interstate. The STN(Intrastate)/Tax invoice
(Interstate) will be generated with reference to the Outbound Delivery (via scheduled background jobs.)

Please refer below the illustrations for both these cases:

Private Labels:
Intrastate (Private Labels):
 In the case of intrastate stock movement (within the same state) from LM
warehouse/Store to Franchisee store (Private labels), a STN i.e., Stock Transfer Note will be
generated in SAP not the tax invoice (as Franchisee store is using the same GSTIN number).
 Proforma invoices will be created in the SAP system with reference to the outbound
delivery.
 E-Way bill will be generated (via BOLT-ON) for the goods movement if applicable.

Pricing Procedure for Intrastate Stock Transfer:

Condition Amount Condition
type Condition description (Per Qty) Value Condition category
Product MRP value
100 100
ZMRP (Static) Automated condition
Product Purchasing price
42.86 42.86
ZPPP (WAC) Automated condition
Percentage Based Markup (Manual
0 0.00
ZMKP Add on Cost condition)
ZMKV Add on Cost 0 0.00 Value base Markup (Manual condition)
Movement Price 42.86 42.86 Calculated in S4 system
 Transfer Value 42.86 42.86 Calculated in S4 system

ZMRP- Product MRP Value. This will be fetched from article master.
ZPPP- Product Purchasing Price. This will be fetched from article master.
ZMKP/ZMKV- Add on cost. This is a manual condition and needs to be put manually. ZMKP is percentage
base. ZMKV is value based.

Note: The condition type will always be a 4-digit alpha-numeric code. The nomenclature for Condition
type as well as condition type description can be changed as per the requirement.
Note: For Intrastate movements taxes will not be applicable. Only the Inventory transfer value (Cost) will
be posted to Inventory Control Account.
Interstate (Private Labels):
 In the case of interstate stock movement (one state to another) from LM
warehouse/Store to Franchisee store, a tax invoice will be generated in SAP with IGST (as
the LM GSTIN numbers will be different for different states.)
 Tax amount will be accounted to Tax G/L account however Inventory transfer value
(Cost) will be posted to Inventory control account.
 E-Invoicing & E-Way bills will be generated only after manual release of invoice to
accounting. Billing Type posting block functionality will ensure that account posting will be
done only after manual release of billing document. The Tax Invoice will be forwarded to the
E-Invoicing portal via BOLT ON. For every Tax Invoice, an IRN number and QR code will be
received in SAP system against the S4 Billing document number.
 After Tax invoice creation, e-mails will get triggered (to registered E-mails Id’s for the
internal & external Business Partners).
Pricing Procedure for Interstate Stock Transfer:
Condition Amount Condition
type Condition description (Per Qty) Value Condition category
ZMRP Product MRP value (Static) 100 100 Automated condition
ZPPP Product Purchasing price (WAC) 42.86 42.86 Automated condition
Percentage Based (Manual
0 0.00
ZMKP Add on Cost condition)
ZMKV Add on Cost 0 0.00 Value base (Manual condition)
Movement Price (Exc. GST) 42.86 42.86 Calculated in S4 system
Maintained in S4 as condition
5% 2.14
JOIG Integrated Tax Amount record
Transfer Value (GST Inclusive) 45 45 Calculated in S4 system

ZMRP- Product MRP Value. This will be fetched from article master.
ZPPP- Product Purchasing Price. This will be fetched from article master.
ZMKP/ZMKV- Add on cost. This is a manual condition and needs to be put manually. ZMKP is percentage
base. ZMKV is value based.
JOIG- Integrated Tax. This is maintained as a condition record in S4.

For Other Labels:

For Other labels, vendors will directly ship the goods to the Franchisee store based on the PO
received from LM. For all the stock transfers, Vendor will raise a Tax invoice to LM.
  For both Intrastate as well as Interstate, a tax invoice will be created by vendor
(Vendor Tax-Invoice) as the GSTIN number of both vendor and LM is different.
 Goods receipt (GRN) against PO will be performed at the Franchisee location.
 Once LM receives the vendor tax invoice, LM’s central team will do invoice
verification i.e., entering incoming invoice receipt (Vendor Tax Invoice) against the
PO.
Note: Invoice verification Process for Other labels will be covered in detail in Finance BPC.
BPC Name (as aligned with respective track):
Lakshya_FIN_BPC_FI-02A Accounts Payable – Trade

3.6 Stock Transfer Process Flow Chart

The following depicts a flow chart illustrating the comprehensive end-to-end stock transfer process,
involving the movement of stocks from Landmark premises to the Franchisee store (APOB).

3.7 Process Flow Description for Stock Transfer Process

System T-
Steps Process (key step) TO - BE Process System
code Roles
Master data will be created in the S4
1 Create Master data SAP
system.
A site will be created for the supplying
warehouse/store and receiving Franchisee
store. Franchisee store will use the same
Create Site as a GST number as LM. The GST number for
1a SAP WB01
customer the site will be maintained in site master &
the GST number for the Fracnhisee
customer will be maintained in customer
master.
Pricing condition records need to be
Maintain Pricing VK11, VK12,
1b maintained for the Tax & Commission SAP
Condition records VK13
percentages.
 Condition record for the Outputs will be
Maintain Output created for triggering the E-mail. E-mail will VV11, VV12,
1c SAP
Condition records be sent to registered E-mail Id’s for the VV13
internal & external Business Partners.
A Condition contract will be created in SAP,
Create Condition
1d which will be used for the margin SAP WCOCO
Contract
calculation/accrual for the Franchisee.
The planning team will initiate STO process
Planner will initiate Outside
2 for the movement of stock from LM
STO SAP
Warehouse to the Franchisee location.
Stock transfer order will be created to
initiate stock movement process. In the
3 Create STO SAP ME21N
case of other labels, a PO will be created
for the vendor.
Outbound Delivery will be created with
reference to Stock Transfer Order (STO).
Create Outbound
4 In case of other labels, vendor will directly SAP VL10B
Delivery
ship the goods to the Franchisee store and
no delivery will be created.
Outbound Delivery Outbound delivery document that is
4a from S4 to EWM created in previous step will be interfaced EWM
to EWM for further logistical activities.
The picking of articles will be performed in
4b Picking EWM /SCWM/RFUI
the warehouse.
4c Packing Articles will be packed in the warehouse EWM /SCWM/RFUI
The Post Goods Issue process will be
performed in the EWM system. After PGI
below accounting entries will be
Post Goods Issue
4d generated: EWM /SCWM/PRDO
Stock Transfer- Debit
Inventory- Credit

Subsequently, the below accounting entries

Inventory FI entry will be generated:
4e SAP
will be passed Franchisee Location Inventory (GIT) - Debit
Warehouse Location Inventory - Credit

Based on the movement type, i.e., whether

5 Movement Type Intrastate or Interstate, a STN or a Tax
Invoice will be generated
A STN will be generated if it’s an Intrastate
5a STN Invoice
movement. No taxes will be applicable.
A Billing document including taxes will be
5b Tax Invoice created with reference to outbound SAP VF01
delivery.
5b.1 Release to A Billing document will be released to SAP VF02
 accounting. The below accounting entries
Accounting will be generated.
Output Tax- Credit
Tax FI entry will be Financial entry will be triggered in
passed customer balance.
5b.1.a SAP
Customer Account – Debit
GST Account - Credit
Only after the accounting entries are
generated in the case of Interstate, a Tax
Invoice details be sent to BOLT-ON for E- Outside
6 BOLT-ON
Invoicing and E-Way bills generation. For SAP
Intrastate, STN details will be sent to BOLT-
ON for E-way bill generation.
The IRN number, QR code & E-Way bill will
IRN, QR & E-Way be generated from the E-Invoicing portal
Outside
7 Bill for Interstate.
SAP
For Intrastate, only E-Way bill will get
generated.
Tax invoice/E-Way
Tax invoice & E-Way will be printed at the
Bill printout to
8 warehouse and sent to the Franchisee SAP VF03
Franchisee
along with the goods.
The LM commercial person at the store will
perform goods receipt at the Franchisee
Goods inward at
location. Subsequently, below accounting
9 store SAP MIGO
entries will be generated:
Stock Transfer- Debit
Inventory- Credit
Below financial entry will be triggered in
Inventory receipt background.
9e entry will be Franchisee Location inventory- Debit SAP
posted Franchisee Location Inventory (GIT) -
Credit

3.8 Stock Shortages/Excess

Any shortages/Excess scenario will be handled in same way as normal Goods In-Transit process between
two stores within LIPL. This will be covered in detail as a part of Inventory BPC.

Refer to below BPC link for shortages/Excess scenarios (as aligned with respective tracks):

BPC Name: MM-05C Inventory Goods in-transit

MM-05A Inventory Inwards

3.9 POS Sales at Franchisee location

Landmark POS machines are used for B2C sales using Franchisee GST number. Landmark B2C POS sales
at Franchisee location will be reported back to SAP S4 HANA system via CAR (using IDOCS) by the end of
every day. The LIPL inventory is reduced at the time of B2B sales posting at the end of the day in S4
HANA. But in the CAR system, we will have real-time store inventory visibility based on the B2C sales.
Initial collection for B2C will be by Franchisee. The collection will be transferred to LIPL on a day-to-day
basis via SWEEP Account – Collection posting in AR Module.
 Based on B2C sales, the margin amount will be calculated and accrued in SAP through a
margin condition type. B2B invoice will be generated (after netting of the Franchisee margin
for that day) and raised to franchisee on a daily basis. An e-mail will get triggered (to
registered E-mails Id’s for the internal & external Business Partners) with the B2B invoice
document attachment.
 For B2C sales, there will be no financial postings in LIPL books. All the B2B sales will be
booked in LIPL accounts by the end of every day.

Link for respective POS Sales BPC is as follows (as aligned with POS team):

BPC Name (for a detailed process): Lakshya_SA_BPC_SD-03 Store Sales

Pricing Procedure Illustration for B2B Invoice (raised to Franchisee at the end of the day):

Based on the daily B2C Sales, a B2B invoice will be generated and raised to the Franchisee. The pricing
procedure for the same will be as follows:

Condition Amount
Type Condition Description (Per Qty) Condition Category
ZMRP Product MRP value 100 Automated condition
Less: Customer Percentage
ZDIP Discount 0 Percentage Based (Manual condition)
ZDIV Less: Customer Value Discount 10 Value base (Manual condition)
ZRRP ZMRP-ZDIV (RRP Value) 90 Calculated in S4 system
MWST Tax Amount (5%) 4.29 Maintained in S4 as condition record
ZNOT ZRRP-MWST (NOT value) 85.71 Calculated in S4 system
ZMGN Franchisee Margin - 20% 17.14 Maintained in S4 as condition record
Basic Realization (B2B) 68.57 Calculated in S4 system
JOIG Add: IGST on sale to Franchisee 3.43 Maintained in S4 as condition record
Total Invoice Value 72 Calculated in S4 System

 For ZMGN, JOIG & Basic Realization(B2B), these conditions will not be statistical and will
be accounted. All other condition types in the above pricing procedure will be statistical but
will be made available for reporting.

Illustration:

B2B
Store Type SOA
 NOT GL 68.57 Credit to B2B wholesale sales (=Franchisee Purchase Cost)
GST Output GL 3.43 Credit to B2B Output Tax (=Input to Franchisee Cost)
72 B2B Invoice Value (Purchase for Franchisee)
Fran Tax Payable
0.86 At the time of payment (Debit to Tax reimbursement - input tax)
GL
Fran Payable 17.14 At the time of payment (Debit to Franchisee debtors)
B2C Sales Only for MIS
B2C Output GST Only for MIS
Debit to Bank
B2C Collection 90.00
Credit to Franchisee
COGS Based on B2B sales
Bank GL 18.00 Credit to Bank

3.10 POS Franchisee Margin Calculation

Based on daily B2C Sales that is reported back in S4 HANA, B2B invoices will be generated after netting
off Franchisee Margin as agreed upon. For each B2C sales transaction, the margin amount will be
calculated (through a margin condition type in pricing procedure).
A custom report will be created for the calculation of the Margin amount and accordingly the margin will
be settled to Franchisee monthly.

At the end of the month, direct A/R entry will be passed against the excess receipt of amount (B2C-B2B)
for the settlement of a Franchisee Margin and the Franchisee-Debtors account will be debited.
Franchisee Sales Margin payment advice to be sent to the registered e-mails.

3.11 GST Differential Pay-out

The difference between the B2C sales tax (Which the Franchisee received as Output tax from B2C
customers) and the B2B Sales (Output Tax for LIPL) will be calculated and displayed in a report line item
wise for the business date at the article site level.

This custom report will list the B2C Output Sales GST and B2B Output Sales GST values by article site
wise for the specified business date. These details will be used to calculate the GST Differential amount.
The difference amount computed in the report at a line-item level will be posted to the accrual account
on a cumulative value for a given business date.

There will be a custom report developed by Finance for GST differential pay-out calculation and
settlement. This process will be covered in Finance BPC.
BPC Name (As aligned with respective track): Lakshya_FIN_BPC_FI-04 Accounts Receivable

3.12 Stock returns from Franchisee Location

For Private Labels:

Franchisee can return the unsold or damaged stock back to Landmark warehouse. For Franchise returns,
a new STO document will be created by LM planning team to move the goods from store to Landmark
warehouse. With reference to the STO, an outbound delivery will be created by the LM inventory team,
and a STN(Intrastate)/Tax invoice (Interstate) will be issued by the Franchisee with refence to LM STO
data. The tax invoice (in case of Interstate) will be used for GST credit purposes i.e., for offsetting the tax
paid by the Franchisee during the initial stock transfer from LM warehouse/Store to Franchisee store.
The following steps to create the STO and Delivery for Franchisee returns will be covered as part of
Planning, Inventory & EWM BPCs.

Stock Transfer Order:

 A stock transfer order (STO) will be created in the system by LM planning team from
Franchisee store to LM warehouse.
 The stock from the Franchisee can be returned from:
o Franchisee store to Landmark Warehouse.
o No returns from Franchisee stores to LM stores.
 After the creation of the STO, an outbound delivery document will be generated in S4.

BPC Names (as aligned with respective tracks for a detailed process): PL_02 Allocation

Outbound/Inbound Delivery creation:

 After STO creation, the delivery process initiates to physically transfer stock from the
Franchisee store to Landmark Warehouse.
 An outbound delivery document is generated in S4 against the STO, encompassing
details about the Landmark Warehouse address, article information, the quantity of goods
to be transferred, etc.
 For the outbound delivery, picking will be performed by the store.
 Post goods issue will be performed for the Store outbound delivery.
 Based on the store's outbound delivery, an inbound delivery will be created for the
warehouse (In S4, against the outbound delivery.)
 Inbound delivery documents will be interfaced to the EWM system for receiving the
stocks into LM warehouse from the Franchisee location.
 In EWM, PGR (Post Goods Receipt) event is performed, subsequently it will hit the COGS
entry, inventory will be increased at LM warehouse location.
 After the PGR is performed, the STN(Intrastate)/Tax Invoice (Interstate) will be created
against the outbound delivery.
 Title of ownership of goods at any point of time will remain with LM.

BPC Names (as aligned with respective tracks for a detailed process):
MM-05B Inventory_Outwards
EWM-01 Inbound

STN/Tax Invoice creation for Stock Transfer:

The stock transfer movement from Franchisee to LM Warehouse can be Intrastate as well as Interstate.
Interstate:
  In the case of interstate stock movement from Franchisee store to LM WH, a tax invoice
will be created in SAP (with reference to Outbound delivery) with IGST (as the LM GSTIN
numbers will be different for different states.)
 Tax amount will be accounted to Tax G/L account however Inventory transfer value
(Cost) will be posted to Inventory control account.
 E-Invoicing & E-Way bills will be generated only after manual release of invoice to
accounting. Billing Type posting block functionality will ensure that account posting will be
done only after manual release of billing document. The Tax Invoice will be forwarded to the
E-Invoicing portal via BOLT ON. For every Tax Invoice, an IRN number and QR code will be
received in SAP system against the S4 Billing document number.

Intrastate:
 In the case of intrastate stock movement from Franchisee store to LM Warehouse
(Private labels), a Stock Transfer Note will be generated with reference to Outbound
delivery in SAP (as LM and Franchisee store is using same GSTIN numbers).
 Proforma invoices will be created in the SAP system with reference to the outbound
delivery.
 E-Way bill will be generated (via BOLT-ON) for the goods movement.

Returns for Other Labels (Franchisee store to Vendor):

 For returning Other Labels, a planner will initiate return purchase order (PO) from
Franchisee store to Vendor.
 Planner to check respective creditor’s ledger balance before initiating return to vendor.
 Outbound delivery will be created in S4 system against returns PO.
 For the outbound delivery, picking & packing will be performed by the store in S4
system.
 Post goods issue will be performed for the Store outbound delivery.
 A tax invoice will be generated against the outbound delivery.
 After manual release of tax-invoice to accounting, it will be sent to BOLT-ON for E-
Invoice and E-Way bill.
 Physical movement of stock will happen from Store to vendor location.

Note: The returns process for other labels will be thoroughly covered under Planning & Inventory BPCs.
BPC Name (as aligned with respective tracks):
PL_02 Allocation
MM-05B Inventory_Outwards

3.13 Accounting Entries

Debit Credit Remarks
 STN - Stock transfer from LM Warehouse to Franchisee Location

Intrastate

Franchisee Location
42.86
Inventory (GIT)
Post Goods Issue
LM Warehouse Location
42.86
Inventory
No Taxes will be posted as it's an Intrastate movement with
Invoice
both locations having same GST number
LM Warehouse Location
42.86
Post Goods Inventory
Receipt Franchisee Location
42.86
Inventory (GIT)
Interstate
Franchisee Location
42.86
Inventory (GIT)
Post Goods Issue
LM Warehouse Location
42.86
Inventory
Customer Account 2.14
Invoice
GST Account 2.14
LM Warehouse Location
42.86
Post Goods Inventory
Receipt Franchisee Location
42.86
Inventory (GIT)
B2C Sales Postings- POS Sales (Will not be posted in LIPL)
Bank 90.00
Collections AR Posting in LIPL
Franchisee - Debtors 90.00

Franchisee Customer 90.00 Franchisee Debtors

B2C Sales 85.71 Sales - No FI entry in
B2C Sales -
LIPL or COGS entry.
Franchisee POS
Output Tax 4.29 statistical postings &
only for MIS purpose
B2B Sales Postings (After B2C Sales is reported back, B2B sales is posted in LIPL books)
Franchisee Debtors 72.00
(MRP/ RRP - Margin)
B2B Sales -
MRP - 100 Less 20%
Acccounted in B2B Sales - Wholesales 68.57
Margin) FI Posting as
GL code
B2B Sales
Output Tax 3.43

Inventory COGS - Wholesales 42.86 Cogs - Inventory FI

Accounting Inventory 42.86 Posting
 Margin & GST Differential Postings based on B2B & B2C Sales
AP payable to 20% (Difference
Franchisee Franchisee - Debtors 17.14 between B2C NOT Vs
B2B NOT)
Bank 18.00
B2C Output Sales
AP payable to Tax - reimbursement -
0.86 GST- B2B Output Sales
Franchisee (Input tax)
GST

Note: A/R discussion is in progress in Finance. Once it is completed, accounting entries will be updated
accordingly.
BPC Names (as aligned with Finance Team):
Lakshya_FIN_BPC_FI-04 Accounts Receivable
Lakshya_FIN_BPC_FI_03 Accounts Payable
4. Development Requirements
Sr.
Detailed Requirement Description Development Object ID (Gap)
No
Outbound and inbound communication must be set
up between S4 and E-Invoicing portal to share invoice
1 SD-05
information and to receive IRN number, QR code & E-
Way bill.
A Tax Invoice (STN form) output form needs to be
2 developed. SD-05

E-mail trigger functionality needs to be developed for

3 SD-05
sending B2B invoices to the Franchisee.
The system should not allow cancelling S4 Billing
document if the E-Invoice is not yet cancelled. Only if
an E-Invoice is cancelled, should the system allow to
4 cancel Billing doc in SAP based on the trigger SD-05
received from BOLT ON. VF11 needs to be restricted
to avoid direct Billing document cancellation without
E-Invoice/IRN cancellation.
Pricing Procedure B2B/B2C routines needs to be
5 developed to meet pricing requirements SD-05
(Placeholder)
Custom report for margin calculation using B2C and
6 SD-05
B2B values

5. Review Clarification
Sr.
Query Raised Resolution
No
 Internally aligned with Finance. This
GST Differential Pay-out calculation details need to
1 will be taken care in Finance through
be added to the document.
custom program development.
Internally Aligned. This process will be
Margin calculation & settlements details need to be
2 covered in Chargebacks BPC.
added to the document.
To check Franchisee returns scenario with Inventory
and EWM tea i.e., whether Outbound delivery will be
Internally aligned with respective
3 interfaced to EWM or not.
tracks

Updated the flow chart and process

Feedback received to update flow chart (to add
flow description table as per the
4 numbering for each box), and process Flow
feedback.
description table.
Shared the BPC document internally
Feedback is received to add BPC links from other
within the team across the tracks and
5 tracks- Planning, Inventory, EWM, POS & Condition
they have provided the BPC details.
Contracts.
Background job needs to be
6 The invoice creation needs to be automated. scheduled.

Aligned with Procurement team. GST

To align with procurement team for maintaining two number for the store will be
7
GSTIN, one for customer, another for store. maintained as a site attribute in site
master.
To explore alternate ways to maintain
Tax records so that the number of
8 Tax Computation leading to 16cr records/values records can be records.
Article tax classification to have 6
values as-

6. Change Management
Process
Step No. Detailed Description of Change
(Key step)
Currently, customers are created in oracle apps and RMS
Customer
separately. In S4, going forward there will be a centralized
1 master
business partner created & the business partner information will
creation
flow to all the integrated systems.
The margin is calculated and settled manually as of today. In S4,
Margin
going forward, the differential margin (B2C-B2B) will be calculated
2 Calculation &
automatically based on the report, and settled at the end of the
settlement
month.
GST The differential GST amount is calculated manually and settled at
3
Differential the end of the month in the current system. In S4, going forward,
 calculation & the GST differential amount will be calculated automatically and
Pay-out will be settled at the end of the month.
E-Invoicing & Currently, the generation of E-Invoice & E-Way bills are not in real
4 E-Way Bill time. With S4 integration with BOLT ON, the E-Invoices and E-Way
automation bills will be generated in real time.

7. Abbreviations
Letters Synopsis
DC Distribution Center
STO Stock Transfer Order
SOR Sale or return
WH Warehouse
PO Purchase Order
EWM Extended Warehouse Management
IRN Invoice Reference Number
LM Landmark
PGI Post Goods Issue
RMS Retail Management System
B2B Business-to-Business
B2C Business-to-Consumer
LS Lifestyle
EB Easy Buy
OU Organizational Unit
POS Point of Sales
SOA Sales on Approval
MH Merchandise Hierarchy
BPC Business Process Confirmation
GIT Goods In-Transit
STN Stock Transfer Note
WAC Weighted Average Cost
CAR Customer Activity Repository
BD Business Development
LIPL Lifestyle International Pvt Ltd