Introduction to Trade Asset Management in SAP

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Ratnapriya Verma
Ratnapriya Verma

A Trade Asset is an equipment made re-operational in the trade to generate demand for the goods. Trade Assets facilitate the selling of finished goods, in addition to preparing it for utilization.

They are sold, rented, leased or given to customers on loan.

Trade asset is an expensive proposition for a company due to a significant capital investment. To achieve the intended return on investment (ROI), company needs to track, maintain and monitor it closely to enhance sales.

Scheduled maintenance on a Trade Asset is done by providing the technical services which can be:

  • On-Site Repairs

  • Sanitization

  • Preventative Maintenance

  • Quality audit

Trade Assets are identified based on a unique equipment number generated by system, and this number is used in trackin for:

  • Financial purposes:

    • record each Trade Asset when it is received from a vendor
    • enable visibility and maintain history of Trade Asset deployments
  • Operational purposes:

    • maintain history of all technical support services performed for the Customer for each Trade Asset
    • enable periodic service orders to be planned for the Trade Asset

Functional Overview

The functional overview gives an insight of the following key processes involved in Trade Asset configuration in SAP:

Trade Asset

Procurement

Trade Assets type that are to be purchased, inventoried, ordered and priced must be set up as Materials. Trade Assets should be inventoried, received and shipped as non-valuated inventory.

In the FI box Purchase requisitions and Purchase Orders are created followed by Asset Master record creation.

Each capitalized Trade Asset will be tracked in the Asset Management system as a fixed asset for accounting purposes. When the fixed asset master record is created in Asset Management, an equipment record is created automatically, which will then be used to track the whereabouts of the trade asset during its life in the trade.

Master Data

Several master data objects are specific to the trade asset management process. These objects are used to monitor the location of the trade asset inventory. This data is maintained throughout the entire trade asset lifecycle and will represent the current financial status of the asset. Some of these data are:

  • Fixed Asset

  • Material Number

  • Serial Number

  • Manufacturer name, model and serial number

  • Sales Area & Sales Organization

  • Distribution Channel & Division

  • Updated Trade Asset Equipment Records – installation to Functional Location and removal from Functional Location

Following records are maintained during Master Data creation:

  • Equipment Record – to each Trade Asset a unique SAP Equipment number is created during procurement. When the asset is deployed at Customer’s location it is managed by the same Equipment number.

  • Functional Location – it indicates the physical location of the Trade Asset installed, it is a SAP technical object and following four SAP partner functions will be linked to the Functional Location :

    • SP Sold-to
    • BP Bill-To
    • PY Payer
    • SH Ship-to
  • Materials – Different types of materials are used for different types of products.

    • ZGNV – used for trade assets
    • DIEN – used for Services
    • ZTAS – Used for spare parts

Order Entry

Order creation for Trade Assets use the standard order type. This enables trade assets to be ordered and shipped similarly as the finished products. The order process enables the deployment and retrieval of trade assets using standard orders. Order management of services and spare parts is also managed in this process.

Settlement

The settlement process includes the reconciliation of trade asset order activities including trade asset movements, technical services, and recurring billing. Following steps take place automatically during Trade Asset Settlement process:

  • Capture of Serial or Equipment number in settlement

  • Capture of placement location text

  • Automatic update of the Equipment / Functional Location relationship

  • Automatic update of Equipment Record user status

Service and Maintenance Contracts

Contracts are used primarily for the management of recurring rental or service billing agreements and/or for planning and generation of preventive maintenance activities.

Accounting

Trade Asset Administrator is responsible to ensure that any change to the status in the Equipment Record is updated adequately in the Finance box. Specifically when Equipment is received, installed, sold, or scrapped, the corresponding asset is maintained.


This article by Ratnapriya Verma, Denmark took part in the joint contest, which SAP Expert ran together with Zinio.

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