sd foreign trade

India SAP CoE, Slide 1

SD2015 SD Foreign Trade v 1.0


Foreign Trade?

Exchange of Goods and Services across the

international boundaries and territories

Significant Share of GDP

Increase in Foreign Trade is basic to Globalization.


SD Foreign Trade

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2 TellMe

3 ShowMe

4 LetMe

5 HelpMe


Purpose

Manage import and export processes, integrating them efficiently into the

supply chain

Automatically identify licensing requirements for importing and exporting

goods based on current regulations

Simplify reporting with automatic procedures for creating, printing and

submitting declarations.

Determine which of your products qualify for preference handling.

Provide an active interface for sending or retrieving data via internationally

available EDI systems and other electronic media

Update or change data in all relevant foreign trade documents at any time

prior to the final goods issue. Even after you have posted the goods issue,

you can still change data in the invoice


Use Cost Effective

Easy to Use

Integrated with total SAP

system


Challenges

Data

Service

Preference

Processing

Communication

&

Printing

Documentary

Payments

Legal

Control

Periodic

Declarations

General

Processing

Foreign

Trade


SD Foreign Trade

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2 TellMe

3 ShowMe

4 LetMe

5 HelpMe


Foreign Trade As countries move increasingly toward a global market economy,

businesses become more involved in and influenced by foreign trade. This affects not only the vendor and customer relationship, but that of foreign subsidiaries within a single company. With this opening of market opportunities come regulations, licenses, import tariffs, and an increasing amount of paperwork required by government agencies and other legal entities.

SAPs R/3 Foreign Trade application enables you to:

Manage import and export processes, integrating them efficiently into the supply chain

Automatically identify licensing requirements for importing and exporting goods based on current regulations

Simplify reporting with automatic procedures for creating, printing and submitting declarations

Determine which of your products qualify for preference handling

Provide an active interface for sending or retrieving data via internationally available EDI systems and other electronic media

Update or change data in all relevant foreign trade documents at any time prior to the final goods issue. Even after you have posted the goods issue, you can still change data in the invoice.


Foreign Trade The Foreign Trade/Customs (FT) application component is integrated

with Materials Management for handling imports and with Sales and

Distribution for exports. In the area of documentary payments, it is also

integrated closely with the Financial Accounting application.

The below shows where FT data is integrated into the R/3 environment


Import Processing

This scenario describes the processes involved in importing goods into your

country from a third country. In this sense, a "third country" is defined as the

country of export when no trade agreement exists between your country and the

exporter. In this case, you are responsible for compliance with the import laws of

your own country.


Reasons for Importing Goods There are three primary reasons for importing goods.

1. Trade 2.Production 3.Transit 4.Trade

There are three main reasons why you may want to import for trade purposes:

Comparative advantage Some foreign manufacturers can make products more

cheaply.

Availability Some products are only available in foreign markets.

Marketability A product may be new and you want to market it in your entire

country or in a region of your country.

Production

It is sometimes advantageous to import raw or semi-finished materials to be used in

a manufacturing process.

Transit

Foreign merchandise with the status "in transit" is exactly that passing through

your country on the way to another. At the plant level in the SAP System, this

refers to a goods receipt that immediately becomes a goods issue to a country

other than the location of your plant. A carnet TIR (document which allows

passage of foreign merchandise through a customs territory) may be required for

the transfer of goods under bond in your country.


Import Process You (the importer) first request a quote

(generally, EXW or CIF) for the merchandise. This

may or may not include transportation and

insurance costs.

You prepare a purchase order based on the offer

(quotation) received from the exporter.

The exporter creates a sales order based on your

purchase order and sends it to you.

(Optional) The exporter creates an advanced

shipping notification to inform you of the date

and quantities to be delivered.

The exporter ships the merchandise.


Import Process (continued)

Also at the time of shipment, the exporter

provides you with required documentation

depending upon the terms of sale and your

agreement with the exporter.

Documents may include some or all the following

1. Bills of lading

2. Commercial invoice

3. Export packing list

4. Shipper's Export Declaration (SED) (Required in

the USA for goods valued at $2501 or more)

5. Shipper's Letter of Instructions (SLI) (applies

only to the USA)

6. Single Administrative Document (SAD) (applies

only to the EU)

7. Certificate of Origin

8. Insurance certificates

9. Licenses (when necessary)


Import Process Involving Letter

of Credit You (the importer) first

request a quote for the

merchandise. This may or may

not include transportation and

insurance costs.

You prepare a purchase order

based on the offer received

from the exporter.

The exporter creates a pro

forma invoice and sends it to

you.

You open a letter of credit with

the opening bank in the

country of import.


Import Process Involving Letter

of Credit (continued) This involves advising the bank of the

documents required from the exporter. As

an importer, you not only need the

documents required by customs, but also

the documents that are required by any

other agency regulating your commodity.

These may include

1. Bills of lading

2. Commercial invoice


4. Shipper's Export Declaration (SED)

(Required in the USA for goods valued

at $2501 or more)

5. Shipper's Letter of Instructions (SLI)

(applies only to the USA)

6. Single Administrative Document

(SAD) (applies only to the EU)





Export Processing

This scenario describes the processes involved in exporting goods from your

country to an independent country (third country) where no trade agreement

exists between your country and the importer. In this case, you are responsible

for compliance with the export laws of your own country .


Reasons for Exporting Goods Three primary reasons for exporting goods include

1.Increase profit 2.Consistency in sales profits 3.Extension of the product cycle

Consistency in Sales

Peaks and valleys in the business cycle are inevitable. When the economy of one

country is on an economic downturn, the economy in other nations may be in a

relatively prosperous phase. If you have customers in countries other than your

own, your business profits tend to become more consistent from year to year.

Product Cycle Extension

When you export your product, the end of the product cycle is postponed. When the

market in your own country is saturated, exporting allows you to introduce your

product into other countries.


Export Process The importer first requests a

quotation for the desired

merchandise.

You (the exporter) provide a

quotation for the merchandise to

the importer including costs

based on the terms of sale

requested by the importer

(usually, EXW or CIF).

The importer sends you a

purchase order based on your

offer.

You issue a sales order based on

the purchase order and send it to

the importer.

(Optional) You may also send an

advanced shipping notification to

inform the importer of the exact

date and quantities of

merchandise to be delivered.

You ship the merchandise to the

customer.


Export Process (continued) Also you need to provide

documentation based on the terms

of sale and your agreement with the

importer. Documents may include

some or all the following:

1. Bills of lading

2. Commercial Invoice


4. Shipper's Export Declaration (SED)

(Required in the USA for formal

entry valued at $2501 or more)

5. Shipper's Letter of Instructions

(SLI) (applies only to the USA)

6. Single Administrative Document

(SAD) (applies only to the EU)





Document Requirements Certificate of Origin: The certificate of origin is an official declaration, which certifies the country in

which a commodity originated or was

manufactured. In most cases, the importer and

exporter must keep this document on file and

provide it to the government only if requested.

Shipper's Export Declaration (SED): In the USA, the SED is only required for shipments valued

at more than US$ 2500 (formal entry). If you are

shipping goods out of the USA, the SED does not

go to the importer. You must send it to the US

Government before the shipment leaves the US.

With the Automated Export System (AES), you can

file this document electronically.

Export vessel movement summary sheet: If you export by ocean from the USA, you must file

this document with the Customs Service.


Foreign Trade Data in Master

Records Master data relevant to foreign trade that is used throughout the entire

logistics chain in Materials Management (MM) and Sales and Distribution (SD)

documents.

Material Master Record

To go to a material master record from the SAP standard menu, choose

Logistics Materials Management Material Master Material.

You can display or enter data relevant to foreign trade in the following views of

the material master record:

Basic data 1

Base unit of measure

Material group

Division

Net weight

Gross weight

Weight unit

Sales organization data 1 and 2

Tax category/classification

Sales: General/Plant Data



Records (continued) Transportation group

Loading group

Foreign Trade: Export data

Commodity code (or Import code number)

Country of Origin

Region of Origin

Legal (export) control information

Preference information (when applicable)

Foreign Trade: Import data

Import Code number (or commodity code)

Export/import group (a grouping of similar materials for

export or import transactions)

Country of origin

Region of origin

Accounting 1

Valuation class

Price control

Price unit

Moving average price



Records (continued) Customer Master Record

To go to a customer master record from the SAP standard menu, choose

Logistics Sales and distribution Business partners Sold-to-party.

You can maintain data relevant to foreign trade data on the following

screens of the customer master record:

General data

City

Country

Region

Transportation zone

Postal code

Language

VAT registration number


The customers country helps indicate export transactions in sales and

distribution (SD) documents. You need the customers region for declarations to

the authorities.

To go to the Shipping and Billing information screens from the General data

screen, choose Goto Sales area data.

Shipping

Shipping conditions

Delivering plant

Billing

INCOTERMS

Terms of payment

Payment guarantee procedures

Licenses (legal control data)


Records (continued)


Preference Handling There are several possibilities for qualifying your

product as originating in your country or economic zone.

For example, these methods include:

Tariff shift (rules of origin)

Tariff shifting means you apply enough labor to the

product or its components to change its commodity

code.

De minimus rule (maximum of 7% non-originating

goods)

The de minimus rule allows a product to qualify for

preference if no more than 7% of the product is

composed of non-originating goods.

Certificate of origin (vendor declaration)

Your vendors give you a document certifying that the

product or its components originate in your country or

economic zone.


Customs Data This task enables you to transfer foreign trade data objects from your

database to another system. Currently these objects include the following


SD Foreign Trade

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Customizing

IMG Sales and Distribution Foreign Trade/Customs


Incompleteness Schemas for

Foreign Trade Data

Sales and Distribution Foreign Trade/Customs Control Foreign

Trade Data in MM and SD Documents Incompleteness Schemas for

Foreign Trade Data

In this IMG activity, you

define the incompletion

procedures that you want

to use at header and/or

item level.

You assign valid foreign

trade fields to each

incompletion procedure.


Foreign Trade Data in MM and SD

Documents


Trade Data in MM and SD Documents Foreign Trade Data in MM

and SD Documents

Assign the relevant

incompletion procedure for

header and/or item data to

the import and export

country.

You also define how the

system reacts when data is

incomplete.

Furthermore, you define in

the "consistency check"

section whether the system

only allows valid

combinations of modes of

transport and customs

offices during document

processing.


Import Screens In Purchasing

Document


Trade Data in MM and SD Documents Import Screens In Purchasing

Document

Set the system to propose

import screens for the

subsequent maintenance

of purchase orders and

purchasing outline

agreements


Define Default Business Type (SD)

Sales and Distribution Foreign Trade/Customs Basic Data for

Foreign Trade Define Business Transaction Types And Default

Value Define Default Business Type (SD)

Define the business

transaction type designated

by the authorities and assign

it as the business

transaction type proposal for

Sales and Distribution (SD)

as well as Materials

Management (MM)

documents


Define Default Export Procedure

Sales and Distribution Foreign Trade/Customs Basic Data

for Foreign Trade Define Procedures and Default Value

Define procedure default

Define import/export procedures and

determine defaults for Sales and

Distribution (SD) and Materials

Management (MM).

SD Export/Dispatch:

-------------------

The proposal depends on the

following criteria:

Country

Sales organization

Distribution channel

Division

Export/import material group

Item category


Default Values For Foreign Trade

Header Data

Sales and Distribution Foreign Trade/Customs Transportation

Data Default Values For Foreign Trade Header Data

Define default values for

foreign trade header

data. Note that this

object only supplements

vendor master data. It

does not overwrite it.

If you maintain mode of

transport '4' in the

vendor master and

mode of transport '3' in

this object, the system

will propose mode of

transport '4' in the

materials management

document


Allowed Business Transaction Type

Sales and Distribution Foreign Trade/Customs Basic Data for Foreign

Trade Define Combinations Allowed: Business Transaction Type - Procedure

Define the combinations of business Transaction types and procedures that are

permitted

Business Transaction Type

The business transaction type classifies the type of business transaction which is

performed. In the European Union (EU), this information is required for the

reporting of import and export data to INTRASTAT. Additionally, it is used by the

system during export control

Export/Import Procedure Code

The export/import procedure code for foreign trade uniquely identifies an

export/import procedure. For business transactions in the EU, the procedure code

is part of the information that you submit in monthly reports to INTRASTAT.

The system proposes procedure codes, based on the country of export/import, the

sales area, material groups and item categories. For example, the procedure code

can distinguish between goods that are shipped temporarily for further

manufacture by a subcontractor and goods that are shipped to their final

destination after processing by a subcontractor.


Material Master Data

Commodity

Code/Import Code

Number for Foreign

Trade

Transaction Code : MM03


Customer Master Data

Use

In Customizing for Export Licenses you can

determine that certain license types will be

used for customers with mainly military use.

When defining export licenses, the system can

assign license types valid for military use only

to those customers that have been marked as

mainly for military use.

Transaction Code : XD03


Periodic Declarations Foreign Trade's Cockpit for Periodic Declarations is designed to

provide you with a quick, easy-to-use overview of the most

important functions in the area of declarations to the customs

authorities.

To go to the Cockpit for Periodic Declarations from the SAP main

menu, choose Logistics Sales and Distribution (or Materials

Management) Foreign Trade/Customs Periodic Declarations

Cockpit Periodic Declarations.

Choose Sales and Distribution (or Materials Management

Purchasing) Foreign Trade/Customs Periodic Declarations

Screen Section Function Operations Create periodic customs declarations

Maintain declaration data

Perform archiving tasks

Monitoring Display and update foreign trade data in material

master records

Goods catalog Create and display goods catalogs

Settings Make relevant settings in the Implementation

Guide (IMG)

Additional Declaration Germany Create declaration for foreign trade in Germany

involving mineral oil products


Prohibitions And Restrictions Foreign Trade's Legal Control

Cockpit is designed to provide you

with a quick, easy-to-use overview

of the most important functions in

the area of Legal Control. These

functions assist you in checking

your business transactions for

compliance with several foreign

trade laws and regulations (for

example, the export of weapons-

related products).

To go to the Legal Control Cockpit

from the SAP main menu, choose

Logistics Sales and distribution

(or Materials management)

Foreign Trade/Customs

Prohibitions and Restrictions

Cockpit Legal Control.

Licenses Creation, display or

modification of

license master

records

License data Assignment of

licenses to

documents

Alert reporting Display of sales

documents and

licenses

Controlling Check of customer

master records

and material

master records

Simulation Simulation of Legal

Control

transactions

Settings Check of

Customizing

settings

Declarations Disk creation for

Export Office


SD Foreign Trade

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LetMe

MM01 Maintain Material Master

XD01 Maintain Customer Master

VI29 Incompleteness Schemas for Foreign Trade Data

VI49 Foreign Trade Data in MM and SD Documents

VI95 Default Values For Foreign Trade Header Data

VI52 Define Forms of Payment Guarantee

VX11N Create a Financial Document to the Customer

Transactions


SD Foreign Trade

1 PrepareMe

2 TellMe

3 ShowMe

4 LetMe

5 HelpMe


Additional Info

http://help.sap.com/saphelp_erp2004/helpdata/EN/d8/2585347860ea

35e10000009b38f83b/frameset.htm

sd foreign trade

Documents

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