How to sell Services in Sales Order

How to Sell Services in Sales Order:

Services contribute to the significant potential of company’s overall success and profit. For this reason, product-related services are sold together with their products.

The three main categories of services are

1. Time and Material
2. Fixed Price
3. Fixed Price without actuals

Time and Material in Sales Order (SECO)

When you want use the Item Type –Time and Material in the Sales Order, then you must ensure that the relevant question mentioned below is scoped in the Business Configuration.

You can navigate to the Question by going to Business Configuration=> Select the respective Implementation Project and click on the Edit Project Scope button. Navigate to Step 4 Questions. Select the Path: Sales => Product and Service Portfolio for Sales=> Sell Services. Check the Group: Service Types for Sales with Tracking Actuals and enable the question:

Do you sell services for a price based on the actual time and material needed?

Process Flow of Time and Material in Sales Order

There are two options to record time for a Service with item type Time and Material, depending on your scoping settings.

1. You can record the time by creating a Service Confirmation manually. When you add a Service of the item type time and in the Sales Order, release it to Service Execution and when you then click Confirm Service Execution, the Service Confirmation will be created immediately. You can then release the Service Confirmation with or without Order Completion
2. You can record the time via the time recording in the time sheet of the service performer.

If you want to record the time for the performed Service via the time sheet of the performer you have to enable the Question: Do you want to record time for sales orders?

In the Business Configuration=> Select the respective Implementation Project and click on the Edit Project Scope button. Navigate to Step 4 Questions. Select the Path: Sales=> Selling Products and Services=> Sales Order=> Check for the Group=> Sales Order Processing with Time Recording

In this case the Service Confirmation is automatically created when the employee records his/her time for the respective Sales Order Item. The Service Performer can record the time by going to the Home work center=>Self Services overview=>Time=>Edit my Time Sheet. He/She can enter the time and upon the “Release” action the Service Confirmation is automatically created by the system.

When the time recording is scoped in the system and you try to create a Service Confirmation via the action “Confirm Service Execution” in the Sales Order manually, the system will display the following warning message and the Service is not automatically populated in the Service Confirmation. The system also does not allow to release the Service Confirmation if this is the only Service in the Sales Order for which the Service Confirmation is created since no item is present.

Invoicing Process:

The invoicing for the item type Time and Material will be done via the Service Confirmation Invoice Request and the invoicing of the confirmed quantity is derived from the Service Confirmation.

Cost Accounting Process:

• determination of cost of service rate
• actual time needed for service execution derived from service confirmation document (duration)
• cost of services assigned to order after confirmation

Fixed Price in Sales Order (SERV)

To use item type Fixed Price, the following question needs to be in scope in the Business Configuration:

Business Configuration=> Select the respective Implementation Project and click on the Edit Project Scope button. Navigate to Step 4 Questions. Select the Path: Sales=> Product and Service Portfolio for Sales=> Sell Services and check the Group: Service Types for Sales with Tracking Actuals

Question: Do you sell or provide services for a fixed price, but track the actual time and materials needed for reporting purposes?

The Process flow is similar than for Time and Material. The Time Recording can also be done for the Item Type Fixed Price. The Service Confirmation is mandatory for Item Type Fixed Price.

Invoicing Process:

The invoicing is triggered via the Service Confirmation but the invoicing is done via the respective Sales Order Invoice Request and the invoiced quantity is derived from the Sales Order.

Cost Accounting Process:

• determination of cost of service rate
• actual time needed for service execution derived from service confirmation document (duration)
• cost of services assigned to order after confirmation

Fixed Price without Actuals (SEFL)

To use item type Fixed Price without Actuals, the following question needs to be in scope in the Business Configuration:

Business Configuration=> Select the respective Implementation Project and click on the Edit Project Scope button. Navigate to Step 4 Questions. Select the Path: Sales=> Product and Service Portfolio for Sales=> Sell Services and check the Group: Service Types for Sales without Tracking Actuals

Questions: Do you sell or provide services for a fixed price, but do not track the actual time and materials needed?

In this case the Service is confirmed directly in the Sales Order. No Service Confirmation is needed.

Invoicing Process:

The invoicing is triggered when the service execution is completed in the Sales Order, the invoicing is done via the respective Sales Order Invoice Request and the invoiced quantity is derived from the Sales Order.

Cost Accounting Process:

• determination of cost of service rate
• actual time needed for service execution derived from service confirmation document (duration)
• cost of services assigned to order after confirmation

Below is the table for the service confirmation and Invoicing reference with respect to each Item Type.

Regards,

Shubha