From a business point of view, Sales and Distribution is a part of the Logistics in the SAP Enterprise Structure. The organization structure of SD involves five parts – Sales Organization, Distribution Channel, Division, Sales Office and Sales Group. The last two parts are optional but first three are almost always used.
Sales Organization – SO is responsible of distribution of goods and services for a company. One SO is uniquely mapped to a Company Code and is also mapped to one or more plants. SO is responsible for a product from sales and legal point of view. Sales figures are usually summarized at SO level.
Distribution Channel – DS is the means through which a product (goods or service) is made available to customer. Since multiple SOs can employ same means, same DS can be mapped to multiple SOs.
Division – Division can be imagined as a product line. Hence, one division can be mapped to multiple SOs and DSs. Interesting thing is that a material can be assigned to only one Division.
Please note that together, Sales Org., Distribution Channel and Division form a Sales Area.
Sales Office and Sales Group – Sales Office and Sales Group are generally used for assessing sales performances in a geographical area or internally.