What is condition type in SAP SD - Sales and Distribution?

SAP Term: condition type

• Component: SD

• Component Name: Sales and Distribution

• Description: Identification that defines characteristics, attributes, and business meaning of a condition. The system can, for example, contain different condition types for free-goods, sales-based rebate, or gross price discount. Every condition type has its own access sequences, condition tables, and condition records.

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• Key Concepts: 
  Condition type is a pricing element in SAP Sales and Distribution (SD) that determines the calculation of the price or discount for a particular material or service. It is used to define the pricing procedure and to determine the pricing conditions for a sales document. The condition type can be based on a fixed value, percentage, or formula. 
  
  How to use it: 
  Condition types are used to define the pricing procedure in SAP SD. The pricing procedure is a combination of condition types that are used to determine the pricing conditions for a sales document. The condition types are assigned to the pricing procedure in the order in which they should be calculated. The condition types can be based on a fixed value, percentage, or formula. 
  
  Tips & Tricks: 
  When creating condition types, it is important to consider how they will interact with each other and how they will affect the overall pricing of the sales document. It is also important to consider how the condition types will interact with other elements of the sales document such as taxes and discounts. 
  
  Related Information: 
  For more information on condition types in SAP SD, please refer to the SAP Help Portal (https://help.sap.com/viewer/product/SAP_ERP_SD/6.0/en-US).