Master Data setting is a key. Its failure will make tons of works. SAP creates PL by products derived from Master Data.

Let’s assume that a business man runs his stationary shop. He sells various item in his store, mechanical pencils, notebooks, computer accessories and so on. Some manufactures, Pilot, Mitsubishi Pencil, produce mechanical pencils. In addition, there are high-end or low-price range ones.

It is obviously important that management understand which products makes largest revenues and shows high profitability.

What can he do for it ?

There is not the answer. Management has to look for his own in his business circumstance, taking his position in his business area into consideration.

SAP provides one function as a solution for his strategy. That is the product hierarchy and it comes from Master Data.