Service Management – Selling a Subscription

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I’ve recently had multiple different people ask me a similar question.  The general idea is that a company has a product that they want to sell on a contract.  This product will then be shipped on a regular interval.  This can often apply to some sort of consumable for a product, like cleaning supplies, testing kits, whatever.  The customer buys a bunch up front, typically at a discounted rate, or they simply want to include a bunch of extras on a big contract purchase order.  Either way, the idea is to buy a bunch in advance and have them delivered sometime in the future…  or on a regular interval.

I’ve spent some time digging, but unfortunately, I haven’t found a good solution.  I have found 3 different ways talked about, so I wanted to cover them and explain what I have found.  Maybe you can tell me a better way to do it.

  1. Subscription order.  This is the most promising.  It is a specific sales order type that is designed to deliver something on a regular interval.  The drawback, unless you have IS-Media, you don’t have this functionality.  I believe it also requires some master data setup, which could be an issue if you sell this product normally and on a subscription.  I wasn’t able to dig further into this to know for sure.
  2. Schedule Agreements.  Again, this sounded like a winner, but as I dug into it, it really appears to have little difference from a standard order.  I could not find any functionality to help me automatically drive schedule line dates.
  3. Standard Sales order…  for me, I chose to go down this process because if I had to set the schedule lines manually anyway, why mess with a different order type or fancy configuration.  Simply lock in the schedule lines so that they are not rescheduled, and enter in the quantity to be delivered on each date.

Now, this still is far from ideal, so I might end up designing something into my Renovation tool for service contract processing.  Then I can add an option to add an item on a schedule.  Then define if it is monthy, quarterly, yearly or manual.  Sound like anything you might be able to use?

Thanks for reading,

As always, thanks for reading and don't forget to check out our SAP Service Management Products at my other company JaveLLin Solutions,
Mike

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