SAP

Customer Master
Data and Master
Data Management
is of core
importance in SAP.
A transaction’s
accuracy is based
on correct and
accurate Master
Data. If the Master
Data is not
maintained in the
SAP system,
transactions cannot
be performed. If the
Master Data is not
properly and
accurate
maintained, process
like either Procure-
to-Pay or Order-to-
Cash, Record-to-
Report, Hire-to-
Retire, Plan-to-
Produce will not be
processed
accurately. If same
are not processed
accurately, accurate
reporting cannot be
obtained by any
means.

The importance of Master Data can be understood by this example that many companies
have experienced and dedicated Master Data Management resources in their Master
Data Management team meaning, there are set of employees who are dedicated and
solely look after Master Data they are usually called the Master Data Management (MDM)
team. They carefully consider the Master Data, responsible for entering accurate data in
prescribed fields. They also closely observe, look vigilantly and check thoroughly if there’s
any repetition, duplication and redundancy of the Master Data.
Master data contains information that is always used in the same way. Master data forms
the basis of sales and distribution processing. Data about the products as well as about
the business partners (customers) are the basis for sales processing. Sales processing
with the SAP ECC system requires that the master data is maintained in the system.

SAP Customer Master Data would include all the details regarding the customers which
are to be maintained into the system and used as and when required. SAP Customer
Master Data, as can be seen from its name, is the Master Data related to Customer
information. In SAP, if you wish to sale finished goods, services or even scrap, you need
a Customer so that the sales can be recorded and executed.

Customer Master Data can be classified as:

• Sales & Distribution Customer

• Finance or FI Customer

Let’s have a brief look on both types of Customers.

Sales & Distribution Customer

Sales & Distribution Customer is one whom you sell your manufactured or trading goods
and services meaning the products which belong to your organization and for which you
are known at the market. This type of Customer can also be used for the selling scrap
materials, which is a regular feature in the organization, when you want to record and
track the actual quantity of the scrap sold, if it has a significant accounting and financial
impact.

Finance or FI Customer

Finance or FI Customer is one where you want to record sales to those customers who
are not regular ones, not part of your regular sales and you do not offer your regular
manufactured / trading goods and services to them. The example of such type of
customers can be, but not limited to, customers to whom you sell your fixed assets after
they were completely depreciated. Like you have a machinery which has reached the end
of its technical life and now you want to scrap it. Similarly, some companies offer vehicles
for sale which the company has been using for quite some time to their employees first
before offering it for sale at the open market.
In short, those customers who are not part of regular sales and for whom there is no
requirement to maintain Sales & Distribution’s specific data.

Account Groups in SAP Customer Master Data

Account Groups in Customer Master Data are used for high level classification of
Customers. It helps you to classify your Customers based on different traits, sector or line
of business. It also helps to decide which fields are mandatory when you are creating a
customer related to a certain sector, which fields are optional and which fields can be
suppressed or made hidden so that the User at the time of Customer creation doesn’t get
confused.

Example: You can make Value Added Tax – VAT field mandatory in the Account Group
of a regular customer, so that the system doesn’t let the User to bypass the said field until
and unless it is populated.

Under Account Groups you can configure in the backend and define if a certain Account
Group’s Customer number can be assigned internally / automatically by the SAP system
or externally by the User at the time of Customer creation or specific number range for a
specific customer or whether the Customer’s Account Group number range is either
numeric or alphanumeric.

Classification of SAP Customer Master Data

Customer master is a centrally shared data which can be used by the logistics modules
as well as the finance module. Information contained in the customer master record can
be both descriptive and have functional control depending on the usage. Customer
Master Data is classified in following three views:

General Data

General Data in the Customer Master that is relevant for both Sales & Distribution and
Accounting, the data fields are grouped on several tab pages. The general data
includes Name, Address, Telephone number, other contact details, VAT, Tax, Good
Receiving Hours of Customer, Market Standing of the Customer, Correspondence,
Contact Persons with their designation and contract detail, etc.

Company Code Data

Company Code Data is relevant for Financial Accounting purposes and processes. It is
specific for a given Company Code. This view records data of the Customer’s Accounting
Data such as reconciliation account, sort rule, payment terms, withholding tax information,
payment methods, correspondence information with the customer, dunning, insurance,
etc.

Company Code data only applies to one Company Code. This data is only relevant to
Financial Accounting and includes:

• Account Management
• Payment Transactions
• Correspondence
• Insurance

If you edit a master record, you must specify the customer number and a company code
to access the screens containing company code data. You can only invoice a business
transaction if the data on the Payer partner function is entered in the Financial Accounting
view.

Sales Area Data

Sales Area Data is relevant for Sales and Distribution processes and is specific to a
given Sales Area. You can maintain the Sales Area Data in various ways, depending on
the Sales Area (a combination of Sales organization, Distribution channel and Division).
All the sales related information will be maintained in this area. Including Sales, Shipping,
Billing and Partner Function. All the data present in the system will be applicable only for
that specific sales area. The customer can be extended for any other sales area as well
depending upon business requirements.

This view is to record the data of customer related to Sales and Distribution transaction
such as data for sales process, delivery process, billing process and partner function. The
data for one customer can differ for each sales area. This data is only relevant to Sales
and Distribution. If you edit a Customer Master record, you must enter the Customer
number and the Sales Area to access screens containing Sales and Distribution data.
You can only process Sales and Distribution transactions, for example, a sales order,
after entering the Sales and Distribution data for a Customer in the Customer Master
Data.

All critical fields that must be maintained by the business in the system are set as
mandatory fields, so that the users will not forget to enter all the necessary data during
the sales transaction(s). Sales Area data of customers is further classified in following
four tabs/sections:

1. Sales
2. Shipping
 3. Billing
4. Partner Functions

Important SAP Customer Master Data Transactions

Following is the list of the key transaction related to SAP Customer Master Data:

• VD01 – Create Sales & Distribution Customer Master

• VD02 – Change Sales & Distribution Customer Master
• VD03 – Display Sales & Distribution Customer Master
• VD04 – Display Changes Sales & Distribution Customer Master
• VD05 – Block Sales & Distribution Customer Master
• VD06 – Flag for Deletion Sales & Distribution Customer Master
• FD01 – Create Accounting Customer Master
• FD02 – Change Accounting Customer Master
• FD03 – Display Accounting Customer Master
• FD04 – Display Changes Accounting Customer Master
• FD05 – Block / Unblock Accounting Customer Master
• FD06 – Set Deletion Indicator Accounting Customer Master
• XD01 – Create Customer Master – Centrally / Complete
• XD02 – Change Customer Master – Centrally / Complete
• XD03 – Display Customer Master – Centrally / Complete
• XD04 – Display Changes Customer Master – Centrally / Complete
• VCUST – Customer List

How to Create SAP Customer Master Data

As always, there are several ways to start a transaction in SAP ERP:

• Enter XD01 in Transaction Command Field or executing Customer Master

Creation Transaction

Start XD01 Transaction

• Navigate through ‘Tree’

Start XD01 Transaction via Standard SAP Menu

Create SAP Customer Master Data Centrally

Whenever you want to create Customer Master Data, enter XD01 to create Customer
Master complete / centrally.

In the initial screen, a dialog box will appear:

SAP Customer Master – Initial Screen
In the first part of the dialog box, you should select the relevant Account Group. List of
all Account Groups will be displayed:
 Customer Master –
Initial Screen > List of Account Groups
Select the relevant Account Group and populate relevant Company Code, Sales
Organization, Distribution Channel and Division. Since this Account Group has a setting
of ‘external’ number range which is alphanumeric, therefore, enter the Customer code
as well. Else in other case where number range is internal this field needs to be blank.
 Customer Master
– Initial Screen with fields populated
If you do not populate the Customer field the system will prompt with following
message:
 Customer
Master – Initial Screen; System’s Error message when Customer Number is not populated
If you want to reference the Customer which is already created in the system and is very
close to the nature of the Master Data you are about to create, you can use the second
section ‘Reference’ of the dialog box on the initial screen. This step will help and assist
you in populating required fields as they will be copied from the reference Customer,
except the basic information i.e. name, phone, etc. which will help in easing the data entry.
You can change the default populated fields, where required.
 Customer Master –
Initial Screen > Reference Section

Once you have populated all the required fields, press either enter or at the end of
the dialog box.
Customer Master – Initial Screen > All Fields Populated

SAP CUSTOMER MASTER – GENERAL DATA

The system will take you the first tab of the General Data where you are required to
enter Customer’s basic information, i.e. Address, Telephone Number, Email, etc.
Customer Master – General Data > Address
Please note the fields having a check box are required fields. If
they are not populated, the system will prompt with an error

message .
Customer Master – General Data > Address
Enter Name, Address and Search Term. Search Term helps in finding relevant
Customer at the time of Sale Order Entry in the Search Help dialog box. Enter required
fields, when you press ‘More Fields’ button, system will show additional fields:

Customer Master – General Data > Address, Additional Fields

Scroll to other Tabs in General Data and populate data where required.
Customer Master – General Data > Control Data
If your Customer is also your Vendor, you can enter the Vendor number of Vendor
Master in the Vendor field.

Bank Information of the Customer:

Customer Master – General Data > Payment Transactions (Bank Data)

Customer Master – General Data > Marketing (Statistics)
Good receiving hours of the Customer are maintained here:

Customer Master – General Data > Unloading Point

Customer Master – General Data > Export Data

Customer Master – General Data > Contact Person Details

SAP CUSTOMER MASTER – COMPANY CODE DATA

Press button to enter the Company Code Data view.

Since this Customer is created with reference, hence, fields of Reconciliation Account
and Sort Key are already populated.

Customer Master – Company Code Data > Account Management

SAP CUSTOMER MASTER – SALES AREA DATA

Press button to enter the Sales & Distribution data view.

The first tab you will arrive is ‘Sales’. It contains sales related information.
Customer Master – Sales Area Data > Sales
Sales District – A geographical segmentation which defines a higher level of sales
geographical structure.

Sales Office – Sales Office establishes connection between the company and the
customer. It monitors company’s sales in the market which is done by company’s sales
force. It is a physical location that has the responsibility of the sale of certain products or
services within a given geographical area.

Sales Group – A sales office can be sub divided into sales groups.

Customer Group – Identifies a group of customers (for example, wholesale or retail).

Currency – the currency in which the customer order goods.

Acct at cust. – Your Vendor or account number which the Customer uses in their
organization for various purposes.

Price group – which pricing group does the customer belongs, for pricing condition
purposes.
Cust.pric.proc. – for determination of correct pricing structure on Sales Order.

Price List – the pricing classification to which the customer belongs.

Cust.Stats.Grp – for generating SIS (LIS) reporting.

The second tab is of ‘Shipping’ which is relevant at the time of delivery / dispatch or
shipment of goods to the Customer.

Customer Master – Sales Area Data > Shipping

Delivery Priority – High, Normal, Low, Medium.

Shipping Conditions – Standard or Immediately.

Delivering Plant – Plant from which the goods to be dispatched to the Customer.

Complete Delivery – if the Customer only accepts complete deliveries and partial is not
allowed. This check box needs to be checked if Customer doesn’t accept partial
deliveries.
Partial delivery per item – whether partial deliveries are allowed.

Max. partial deliveries – the number of maximum partial deliveries are allowed.

Unlimited tol. – if the customer accepts unlimited over or under deliveries of goods
ordered.

Underdel. Tolerance – Percentage (based on the order quantity) up to which an under

delivery is accepted by the Customer.

Overdeliv. Tolerance – Percentage (based on the order quantity) up to which an over

delivery is accepted by the Customer.

The third tab of the Sales Area Data is ‘Billing’:

Customer Master – Sales Area Data > Billing Documents

It contains information whether the Customer is relevant for Rebates.

Incoterms – trading established globally with the standard of International Chamber of

Commerce (ICC)

Terms of payment – agreed terms of payment with the Customer weather is Customer
is a Cash or Credit.

Paym.guar.proc. – Payment Guarantee Procedure defines if the Customer pays via

Letter of Credit, Payment Cards or Bank Guarantee.

Credit ctrl area – Credit Control Area, if the Customer is a Credit Customer and belongs
to a Credit Control Area.

Taxes – if the customer is liable for Taxes or exempted etc.

The fourth and the final tab is Partner Functions:

Customer Master – Sales Area Data > Partner Functions

It shows the parties involved in the sales processing. The following are the mandatory
partner functions:

1. Sold to Party
2. Bill to Party
3. Payer
4. Ship to Party
If the Customer has multiple locations where he ordered the goods to be delivered, you
can add Ship to Parties here in this tab. Please note that the Ship to Party Master Data
should be created under relevant Account Group.

Customer Master – Sales Area Data > Partner Functions, Multiple Ship-to Parties
Once you are done with maintaining and changing values in the SAP Customer Master

Data, don’t forget to press Save or CTRL+S for the values to take effect in your sales
transactions and the system will confirm that the Customer is created and saved.
SAP Customer Master Data – Save confirmation