The trade credit control is one of the basic functionalities in the sales process. It is of strategic importance from a business point of view. This prevents situations in which additional goods or services would be delivered to customers who default on payments above the agreed limit. The credit control allows the company to avoid problems with liquidity or even significant losses if the customer turns out to be insolvent (an exceeded credit limit may mean that our partner has financial problems).
On the other hand, the trade credit control has also an impact on building relationships with the customer. A refusal to supply goods or services due to a slightly exceeded limit can spoil these relationships. Therefore, it is important that the data used as a basis for the control of the credit use be accurate and reliable.
How does it work in SAP?
To put it simply, the rule of trade credit operation in SAP can be described in the following steps:
- for a specific partner (payer) the maximum amount of the credit agreed with a given partner during the trade negotiations is entered;
- when SD documents are being processed, the system checks whether for a given partner the balance of the trade credit granted has not been ...