What is penalty in SAP LOD-ESO - Sourcing OnDemand?

SAP Term: penalty

• Component: LOD-ESO

• Component Name: Sourcing OnDemand

• Description: A sum of money, specified in a master agreement, exacted if the purchaser or supplier violates agreed-upon conditions for purchase or payment of goods and services.

Smart SAP Assistant

• Key Concepts: 
  Penalty in LOD-ESO Sourcing OnDemand is a feature that allows buyers to set a penalty for suppliers who fail to meet the terms of the agreement. The penalty can be set as a percentage of the total contract value or as a fixed amount. The penalty is applied when the supplier fails to meet the agreed upon terms and conditions. 
  
  How to use it: 
  To use the penalty feature in LOD-ESO Sourcing OnDemand, buyers must first set up the penalty in the contract. This can be done by selecting the “Penalty” option from the contract settings menu. Once the penalty has been set, buyers can then specify the amount of the penalty and how it will be applied. 
  
  Tips & Tricks: 
  When setting up a penalty in LOD-ESO Sourcing OnDemand, buyers should consider setting up multiple penalties for different scenarios. For example, buyers may want to set up a different penalty for late delivery than for failure to meet quality standards. This will help ensure that suppliers are held accountable for any failures to meet their obligations. 
  
  Related Information: 
  For more information on setting up penalties in LOD-ESO Sourcing OnDemand, please refer to the official documentation provided by SAP. Additionally, buyers may want to consult with their legal team before setting up any penalties in order to ensure that they are compliant with applicable laws and regulations.