Skip to Content
Author's profile photo Ina Verena Wehrmann

S/4HANA Finance – It’s all about margins!

Within the past years, many wholesale distributors have become leaders in B2B e-commerce business. But today, web shops and an internet presence are commodities and new strategies for differentiation are required. Customer satisfaction and retention can be reached by additional services, but how do wholesale distributors stay profitable?

  • What if you can calculate your precise warehousing costs per product as well as the opportunity costs by replacing one product through another and decide flexibly on taking an order or project?
  • What if you can calculate a higher service level by increasing your safety stock and include this kind of insurance in your offer to your customer?

A precise cost calculation of logistic and service costs is key.

With S/4HANA Finance, a new level of transparency can be reached with the unified managerial and accounting journal, the universal journal. It is the foundation, with all data from different sub ledgers (G/L, assets, profit centres, controlling areas, etc.) coming together. So now, there is one line item table with full detail for all applications. Since all of the data is stored in one place as a single source of truth, and with the power of the SAP HANA data base, no pre-defined aggregation and no reconciliations are required. Aggregation is done on the fly, providing drill-down to detailed information for root cause analysis. Flexible and personal multi – dimensional reporting supports decisions regarding new customers, products and orders. The 2.5X faster cost postings go along with 86% faster real-time analytics according to SAP’s Benchmarking Services.

Financial planning and analysis is now available in the embedded model of S/4HANA Finance without data replication.

Through either eliminating or accelerating batch jobs with SAP S/4HANA Finance, SAP moves companies close to having a soft close at any point during the month. Processes such as intercompany reconciliation can be run during the month, reducing the load at month end. SAP’s Benchmarking Services saw 10 to 20% reduction in G/L & Financial Closing Costs and around 400 hours cut from period end close.

The new real-time cash management and forecasting provides a cockpit for Cash Managers to monitor critical KPI’s in real-time including integrated liquidity forecasting, and Central Bank Account Management including overdraft limit analysis, bank risk analysis, signatory management and workflow support.

If you want to extend additional services in your organization, the receivables processes need to be ready to scale. In automated processes, S/4HANA Finance delivers high quality customer interactions with credit checks for every business transaction, up-to-date customer credit limits, workflows for dispute resolution, collections prioritization and synchronization between accounting / incoming payments and promised payments and open disputes.

Settlement management for rebates is a solution for all kind of rebates and also vendor funds to flexibly settle rebates calculated on various business volumes. The integrated posting into FI/CO allows a sharp view on the exact margin and working capital.

With an end-to-end integration into the ARIBA network, S/4HANA Finance optimizes the collaboration with business partners. The whole process chain is transparent and a detailed remittance processing can be automated.

The offering of additional services requires comprehensive key account management. With SAP Real Spend you can give your sales team a tool to manage their budgets actively. It allows the combination of actual, committed, approved and pending spends into a holistic view on individual dimensions.

The new Fraud Management in S/4HANA Finance combines a fraud database with expert knowledge and predictive manual rules, so that based on a fraud strategy and calibration, a fraud detection process, investigation and performance analysis can be executed. The whole end-to-end process can be automated including the approval and exception handling with real-time alerts and blocks. A fraud calibrator helps to run multiple simulations and with machine learning fraud processes and can be adapted to improve fraud detection.

All in all, S/4HANA Finance is the foundation, even for small and midsize Wholesale Distributors to adapt to new customer requirements with new profitable services.

Assigned Tags

      1 Comment
      You must be Logged on to comment or reply to a post.
      Author's profile photo Kishore Marodia
      Kishore Marodia

      Article starts with great TITLE and interestingly poised SCENARIOS but peters out with regular highly marketed S4 HANA features. Would be helpful if dots are connected.