Creating Sales Contracts

Objectives

After completing this lesson, you will be able to:

  • Discover how to create a sales contract to secure pricing and establish a long term customer relationship.

Introducing Sales Contracts

A sales contract is a way to secure a long-term customer relationship through sales qualities contracts that contain information about product prices and purchase quantities in defined time periods. 

Introducing the sales contract to the sales cycle gives a set of validity period related conditions to our sales documents. Contract documents and their contract terms can be used in subsequent sales documents like quotations and sales order to ensure consistent pricing and quantity terms. 

You can create a contract from a ticket, opportunity, or a customer quote. The Contracts work center supports you in creating sales contracts based on the required details. Let's take a look at how to create a Sales Contract.

Here are some features of SAP Sales Cloud Sales Contracts:  

  • Sales quantity contract support (specifies contracted product purchase volumes over a defined period of time, at agreed upon price points)  
  • Tiered volume discounts are supported  
  • Contract templates  
  • Contract item type and item type determination support of sales area fields  
  • Maintenance of involved parties (inclusive of ship-to parties)  
  • Sales activities related to contract are displayed in Activities facet  
  • Specification of parties authorized for release orders  
  • Incoterms and Payment terms support Contract as follow-on from an Opportunity or Sales Quote Contract as a follow-on to an existing Contract (Related Contract)  
  • Contracts originated from Account or Individual Customer  
  • Territory assignment and realignment run support; related access restrictions based on territory assignment for business roles  
  • Copy and Paste Items (Products) in Contracts  
  • Contract pricing via SAP ERP Integration (External Pricing)  
  • Document attachments  
  • Approval Workflows  
  • Contract determination from Sales Quotes and Orders  
  • Sales Order call-off tracking - shows quantity ordered, quantity remaining   
  • Contract integration with SAP ERP - (Bidirectional Replication, or Unidirectional (SAP ERP to Sales Cloud)  
  • SAP ERP/S/4 Contract Status updates visible in SAP Sales Cloud  
  • Output document templates available  
  • Contract renewal can occur via workflow Opportunities/Notification  
  • Data source for analytics 

Integration with SAP ERP/SAP S/4HANA, mandatory external pricing can take place. Contracts can be determined from sales quotes and sales orders. 

When you define a target quantity, the pricing conditions can be determined. Pricing is document type specific. You can assign a sales quantity contract to a quote item (or sales order item) to control price determination based on a sales quantity contract. Contract templates can be created in Fine Tuning to select contract default data. 

Sales Quote Usage

In the sales quote portion of the sales contract there are two sections to differentiate sales quotes usage: ​

Sales quotes used to derive a contract specific pricing for a quote. With the relationship to the contract, the sales quote can also help determine renewal data.​

Sales quotes created from a contract inherit the contract terms. Notifications can be set up for renewals of contracts before they expire. ​

​You can also integrate Contract Lifecycle Management directly with the Sales Contract based on the selected document type. ​

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