R100 is a condition type for 100% discount and You have to include this condition type in

your pricing procedure. Only then the goods would not be priced. TCODE for configuring
R100 is V/06. TCODE for maintaining your pricing procedure is V/08.

Settings required for the Processing

of free-of-charge items.
In the standard SAP system, free-of-charge items for example, item
categories TANN and KLN have the following settings:

 not relevant for billing

 without pricing

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This causes the following problems:

1. The system does not transfer costs (in the form of the condition type
VPRS) to profitability analysis or statistics because no billing documents
exist.

2. In the case of export transactions, the statistical value (condition

type GRWR) must be determined in the billing document. As a
prerequisite for this, normal pricing must take place because the condition
GRWR is displayed as a percentage of a price.

3. In the case of pro-forma invoices for export transactions, normal

pricing must also take place for free-of-charge items.

4. For intercompany billing (billing type IV), the system uses the
condition type PI02 as a transfer price. Since this condition is a
percentage, normal pricing must also take place for the free-of-charge
item.

The option of setting the item category to statistical does not solve this
problem.

A) For simple cases involving a free-of-charge delivery, it is sufficient to

set the billing relevance of the item category TANN or KLN to 'A =
delivery-related billing document'. As a result, the system bills free-of-
charge items with the value zero and forwards the cost (condition VPRS)
to profitability analysis and statistics.
B) For the solution provided below, free-of-charge items must have the
following settings:
- relevant for billing
and with pricing.

If a 100% discount (condition type R100) is applied, an item becomes a

free-of-charge item.

1.Transaction V/06: Create the condition type R100.

Condition class 'A'
Calculation type 'A'
Item condition 'X'
Manual entries 'D'

2. As of Release 4.0A, requirement 55 exists in pricing. If you are

using an earlier release, create requirement 655 for pricing
(program RV61A655, transaction VOFM).

3. Create a separate base value calculation formula, for example, 928

(program RV63A928, transaction VOFM) (as of Release 4.5A, formula
028 in the standard system).

4. Create pricing requirement 922 (program RV61A922, transaction

VOFM) (as of Release 4.5A, formula 057 in the standard system).

5. Change pricing requirement 002 (program LV61A002) as described

below. This change is included in the standard system as of Release 4.0A.

6. Transaction V/08: Maintain the pricing procedure RVAA01.

If you use a separate pricing procedure, proceed in the same way
(other step numbers may apply):

a) Add the condition type R100: Step 799, print X, requirement 55

(before Release 4.0A, 655), base value calculation formula 28 (Release
4.5A, 928), account key ERS

b) For the conditions PI02 and GRWR, use reference step 400 (net
item value before the 100% discount R100).

c) For the condition GRWR, delete the base value calculation formula
'2'.

d) For all conditions after the R100 condition, enter requirement 922
if the system should not use these conditions for free-of-charge items.
You may require the system to also calculate, for example, freight
conditions (HD00, KF00) for a free-of-charge delivery. In this case, leave
requirement 002.
 e) Also, make sure that the condition types that use the 'Maximum
condition basis' or 'Maximum condition value' function are also assigned
requirement 922. Otherwise, the free-of-charge items would 'consume'
the discount.

7. Transaction VOV7: As of Release 4.0, change all of the item

categories that are used in the free-of-charge delivery (for example, KLN)
or used as free-of-charge items (for example, TANN).
Relevant for billing A,B,C,F,G,H
Pricing B
If you are using Release 3.0 or 3.1, implement the user
exits MV45AFZZ and RV60AFZZ and adjust the source code to the item
categories that you are using. As a result, the 'Pricing' indicator is set to
'B'. Implement the user exit MV45AFZB, so that new pricing takes place
for the order entry and the change of item category.

8. Transaction VOV8: Maintain the sales document type for free-of-

charge delivery (KL) as follows:
Dlv. rel. billing type 'F2'
Document pricing procedure 'A'

9. If you want to create a billing document without an accounting

document for your business transaction, you must remove the account
determination schema (KOFI00 in the standard system) from the billing
type.
In this case, we recommend that you create a separate sales document
type and billing document type respectively (ZKL or ZF2 by copying the
corresponding document types) and adjust it as follows:
Free-of-charge delivery ZKL
Dlv. rel. billing type 'ZF2'
Document pricing procedure 'A'
Billing document ZF2
Account determ.proc. ''

10. If you do not want to specify any values for document printing,
copy the source code from the program RV61AFZB.
SAP Free Goods

Author Written by Ibn e Rasheed and last updated on Posted

onAugust 21, 2017.
Advertisement

Welcome to the tutorial about SAP Free

Goods functionality. It is part of our SAP SD training course. You
will learn about implementation of free goods functionality in SAP
ERP and see how it works in sales orders.

Giveaways, buy two get one free and other types of free goods are a
common practice in the business these days. Swift, cut throat
competition and narrow margins force businesses to offer
something extra apart from the value proposition and unique selling
proposition which the brand offers. Giving away bulk deals to
customers help the businesses to capitalize on their volumes.

SAP offers free goods functionality to meet the requirement of

modern day business. This is the standard feature which SAP Sales
& Distribution offers. We shall be looking at SAP Free Goods
functionality both from frontend and backend configuration
perspective.

SAP Free Goods

Free Goods functionality in SAP Sales & Distribution is based on the

condition records. Condition record is maintained in the system with
the validity dates. If SAP Free Goods condition records falls within
the validity period at the time of an order entry, then a rule of SAP
Free Goods is activated and offered to the customer in the sales
order. Hence, master records for free goods should be created in
the master data which is a prerequisite.

SAP Free Goods functionality works as a Bill of Materials

(BoM) structure meaning when you enter a material in the sales
order and if the material, customer or other combination in which
the condition record is maintained falls true, the system proposes
the free goods quantity based on the rule defined in the condition
record. The system makes an additional line item with item
category ‘TANN’ with the free goods quantity.

These free goods are free of charge and nothing is charged from the
customer. Hence, customer enjoys 100% discount on the free
goods. Based on the country’s taxation structure and commercial
laws, company’s may charge taxes, surcharges, duties or levies
from the customer, only if either the customer or material or both
are liable for taxes. In this case, the customer shall only pay for the
tax, surcharge, duties or levies applicable on the free goods and the
rest will be his discount 100% applied on the base, trade or retail
price.

The system re-runs the free goods condition record in the sales
order if the quantities in the main item change or if the pricing date
changes. The system then deletes the sub-item(s) and re-creates
them. Any manual changes to the free goods quantity are lost.

Types of SAP Free Goods

The following are the types of free goods which SAP Sales &
Distribution offers in the standard.

SAP Free Goods – Exclusive

In SAP Free Goods Exclusive functionality, free goods are offered to

the customer which is in addition to what the customer has ordered.
For example, the customer places an order for 10 pieces, the
business offers 2 free goods or bonus quantities in addition to what
the customer has asked for.
Exclusive free goods can be or a different material or SKU. Meaning,
if the customer orders for material ‘A’, exclusive free goods can
either be material ‘A’ or material ‘B’.

SAP Free Goods – Inclusive

In SAP Free Goods Inclusive functionality, free goods are offered to

the customer which is included in the quantity what customer has
ordered. For example, the customer places an order for 10 pieces, 2
pieces are made part of the free goods or bonus quantities in within
what the customer has asked for.

Inclusive free goods involve the same material or SKU and it must
be same. Meaning, if the customer orders for material ‘A’, inclusive
free goods can only involve material ‘A’.

Configuring SAP Free Goods

To configure free goods at the backend in the SAP system, you need
to type SPRO in the transaction bar. Then, navigate to the
following menu path:

SPRO > Sales and Distribution > Basic Functions > Free Goods

SAP Free Goods – Accessing Backend

If you have a requirement which the standard functionality doesn’t

fulfill, you can create your own free goods determination criteria
using the conditioning technique. In this tutorial, we shall opt for
the standard Free Goods Determination Technique which is
condition type NA00 and procedure NA0001.

SPRO > Sales and Distribution > Basic Functions > Free Goods >
Condition Technique for Free Goods > Activate Free Goods
Determination

Press button to continue. There is a prerequisite to mention

the Sales Area, Customer Pricing Procedure and Document Pricing
Procedure to identify that a particular combination is valid or
relevant for Free Goods Determination.

SAP Free Goods – Activation of Free Goods

SAP Free Goods – Activation of Free Goods (Example)

Here we have identified a particular Sales Area, Document and

Customer Pricing Procedures which are relevant for SAP Free Goods
Determination functionality.

There are further prerequisites for SAP Free Goods to work. We

need to maintain settings for item category.

SPRO > Sales and Distribution > Basic Functions > Free Goods >
Control Free Goods Pricing > Control Pricing for Free Goods Item
Category

Press Button to continue.

SAP Free Goods – Control of Free Goods Pricing Item Category

In the above screenshot, the highlighted Item Categories TAN and

TANN are standard item categories for standard pricing and free
goods. TAN is assigned ‘X’ which is standard pricing and TANN
which is a free goods pricing category is assigned ‘B’ which is
pricing for free goods with 100% discount.
 SPRO > Sales and Distribution > Basic Functions > Free Goods >
Control Free Goods Pricing > Maintain Condition Type for 100%
Discount

Press button to continue.

SAP Free Goods – Control of Free Goods Condition Type

Condition type R100 is the standard condition type for free goods.
You can create a customized one starting from either ‘Y’ or ‘Z’, as
per SAP standard practice for customization, depending on your
requirements. The free goods condition type should be placed in the
pricing procedure.

SPRO > Sales and Distribution > Basic Functions > Free Goods >
Control Free Goods Pricing > Maintain Pricing Procedure for Pricing

Press button to continue.

SAP Free Goods – Maintain Pricing Procedures for Pricing

Maintain Free Good Condition Type Pricing Procedure for Pricing

You can see the free goods 100% discount condition type embedded
in the required pricing procedure. Please don’t forget to mention
routine ’55 – Free Goods’ in the requirement field which actually
activates the free goods functionality on the sales order and routine
’28 – 100% Discount’ in the alternative formula for condition base
value.
SAP Free Goods Condition Records

Enter VBN1 in transaction command field for creating a free goods

master record or navigate as shown on the screenshot below.

SAP Free Goods Conditions Transaction

SAP Free Goods Conditions – Initial Screen

Enter Condition Type NA00 for free goods master record.

Press Enter or button to continue.

SAP Free Goods Master Record – Select Key Combination

Select the relevant combination where you want to maintain the

free goods determination. These combinations can be customized in
the backend. Press Enter or button to continue.

Inclusive Free Goods – Master Record

Enter the Sales Organization, Distribution Channel, Customer

number, validity dates and enter the list of materials offered as free
goods for this customer.
Inclusive Free Goods – Master Record (Example)

Here, we have entered a material which we have chosen for our free
goods inclusive scenario. Minimum quantity should be 10, it
specifies whether free goods applies for the inclusive free goods
scenario against which 1 quantity shall be given as a free good with

calculation rule 01. Once you are done, press button or CTRL+S
to save the assignment and continue.

Calculation Rule in SAP Free Goods Determination

Free Goods Calculation Rule

SAP Sales & Distribution offers three standard calculation rules for
calculating free goods determination. When you specify or choose a
particular rule, the system determines how to proceed further at the
time of sales order execution.

Inclusive SAP Free Goods in Sales Order

Let’s see a demonstration how free goods functionality works in a

sales order.

Free Goods – Create Sales Order – VA01

Once we have entered 5 quantity, press Enter or button to

continue. The system prompts that the minimum threshold of free
goods quantities has not reached.
Minimum Quantity has not been Reached

Now, let’s enter the minimum free goods quantity of 10 and see the

system’s response. Press Enter or button to continue with

execution of free goods.

SAP Free Goods in a Sales Order

Since the minimum level of free goods has been reached, the
system has created another line automatically. Order quantity
entered was 10 ST and the system, based on the free goods master
record, has changed the quantity of main item ‘TAN’ from 9 ST from
10 ST and has created a new line item ‘TANN’ with the free goods
quantity.

Double click a line item and go to the conditions tab or select the
relevant line item and press condition items button to view the
pricing behavior.

Free Goods – Create Sales Order – VA01 – Pricing Conditions of Main Item

Use the buttons to move between line items.

Free Goods – Create Sales Order – VA01 – Pricing Conditions of Sub or Free
Goods Item

You can see that the free goods condition type is activated which
has reduced the base price by 100%. Price of 1 ST is 100 EUR. Price
of 10 x 100 makes 1000 EUR. Since one item is discounted, the total
price of sales order is 900 EUR.
Total Price of the Sales Order

Exclusive Free Goods in Sales Order

Let’s see a demonstration how exclusive free goods functionality

works in a sales order.

SAP Free Goods – Condition Record

On the next screen, press either button or Shift+F6 to

proceed and maintain the exclusive free goods condition record.
Exclusive Free Goods – Condition Record

Enter the Sales Organization, Distribution Channel, Customer

number, validity dates and enter the list of materials relevant as
free goods for this customer.

Exclusive Free Goods – Condition Record (Example)

Here we have entered a material which we have chosen for our free
goods exclusive scenario. The minimum quantity should be 10, it
specifies that free goods applies for the exclusive free goods
scenario against which 2 pieces shall be given as free goods. Once

you are done press button or CTRL+S to save the condition

record and continue.

Next, let’s create a sales order to test our exclusive free goods
condition record.
SAP Free Goods – Create Sales Order – VA01

Once we have entered 5 quantity, press Enter or button to

continue. The system prompts that the minimum free goods quantity
has not been reached.

Minimum Quantity for Exclusive Free Goods hasn’t been Reached

Now let’s enter the minimum free goods quantity of 10 and see the
system’s response.

Main Item (10 ST) and Free Goods Item (2 ST)

Since the minimum level of free goods has been reached, the
system has created another line automatically. Order quantity
entered was 10 ST and based on the free goods condition record,
the main item’s quantities remains unchanged for item category
‘TAN’ but the system has created a new line item (2 ST) with item
category ‘TANN’ for the free goods material.

Double click a line item and go to the conditions tab or select the
relevant line item and press condition items button to view the
pricing behavior.
Free Goods – Create Sales Order – VA01 – Pricing Conditions of Sub or Free
Goods Item

You can see that the free goods condition type is activated which
has reduced the base price by 100%. The price of 1 ST is 100 EUR.
The price of 10 X 100 makes 1000 EUR. Since this is an exclusive
SAP free goods scenario, the total price of the sales order remains
1000 EUR.
Total Price of Sales Order (Exclusive SAP Free Goods Scenario)