How to Configure Product Hierarchy in SAP

SAP Configuration ==> SAP Sales and Distribution

Introduction

Product hierarchy configuration in SAP is a crucial aspect of materials management and plays a vital role in categorizing products for reporting, sales, and distribution processes. 

What is Product Hierarchy in SAP?

In SAP, a product hierarchy is a structured classification of materials. It is stored in the material master record and consists of multiple levels, each characterized by a specific number of digits. These levels help businesses categorize and report materials in a detailed and organized manner.

Standard SAP Product Hierarchy Structure

By default, SAP supports up to three product hierarchy levels, with the following digit configuration:
  • Level 1: 5 digits
  • Level 2: 5 digits
  • Level 3: 8 digits
This gives a total maximum of 18 digits. The standard hierarchy is maintained in the DDIC structure PRODHS. You can define or modify hierarchy nodes at each level based on business requirements.

Customizing the Product Hierarchy

From SAP Release 3.0 onwards, you can extend the product hierarchy to a maximum of 9 levels. To do so, you need to make changes in the Data Dictionary by modifying the structure PRODHS.

Steps to Modify Product Hierarchy Levels in SAP

Step 1: Create Custom Domains

Create new domains for the additional levels. For example:
  • ZPRODH3 with length 5 (type CHAR)
  • ZPRODH4 with length 3 (type CHAR)

Step 2: Assign Domains to Data Elements

Link the custom domains to the standard data elements:
  • PRODH1, PRODH2, ..., PRODH9
Always use standard data elements to maintain system compatibility.

Step 3: Modify the DDIC Structure PRODHS

Update the PRODHS structure as follows:

Before Changes:

Field    | Data Element | Type | Length  
---------|---------------|------|--------
PRODH1   | PRODH1        | CHAR | 5  
PRODH2   | PRODH2        | CHAR | 5  
PRODH3   | PRODH3        | CHAR | 8  

After Changes (Example - 5/5/5/3 format):

Field     | Data Element | Type | Length  
----------|---------------|------|--------
PRODH1    | PRODH1        | CHAR | 5  
PRODH2    | PRODH2        | CHAR | 5  
PRODH3    | PRODH3        | CHAR | 5  
ZZPRODH4  | PRODH4        | CHAR | 3  
Consult an ABAP developer (ABAPER) when making changes to the DDIC structure to ensure compliance with best practices and system integrity.

Navigation Path to Configure Product Hierarchy in SAP

To define product hierarchies in SAP, follow this path:

SPRO → IMG → Logistics - General → Material Master → Settings for Key Fields → Data Relevant to Sales and Distribution → Define Product Hierarchies

Here, you can create, modify, and assign product hierarchy levels as per your business structure.

Conclusion

Customizing the product hierarchy in SAP allows for more granular material categorization, making reporting and sales management more efficient. By understanding the DDIC structure, creating proper domains, and modifying the PRODHS structure, organizations can tailor the hierarchy to their exact needs. Always ensure these configurations are done with proper planning and ABAP support.

FAQs

1. What is the maximum number of levels in SAP product hierarchy?

SAP allows up to 9 levels, with a maximum of 18 characters in total.

2. Can we change the digit structure of the product hierarchy?

Yes. You can customize the number of digits per level by modifying the DDIC structure and domain lengths.

3. Is ABAP knowledge required to configure product hierarchy?

For extending or modifying DDIC structures like PRODHS, ABAP support is highly recommended.

4. Where is product hierarchy maintained in SAP?

It is maintained in the Material Master and configured via SPRO.

5. What are the standard digit lengths in SAP product hierarchy?

The standard structure supports three levels: 5/5/8 digits.

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