Today, I am discussing how one can define a Sales Organization in SAP SD Sales and Distribution module.

The menu path for defining a Sales Organization in SAP is as under:

IMG Enterprise structure >> Maintain structure >> Definition >> Sales and Distribution

In SAP SD terminology, a Sales Organization can be compared to an organizational unit that sells & distributes goods, can negotiate terms and conditions of sale, and can carry out such related transactions.

Related to the concept of a Sales organization is Distribution channel. A distribution channel is a channel through which materials or services reach the end users. Thus, for a Sales organization, distribution channels that could be defined in SAP can include wholesale, retail, and direct sales.

SAP SD allows a user to define and assign a distribution channel to one or more sales organizations. Thus, a customer can be delivered goods from a variety of distribution channels that have been defined. A user can view master record by different sales organization and by different distribution channel. This enables a user to view data according to his needs.