Approval procedures are one of the most useful tools in SAP Business One and one of the most often misconfigured. Set up well, they stop the expensive mistakes before they happen: the order shipped to a customer who has not paid in three months, the quote sold below cost, the purchase order nobody authorized. Set up badly, they either approve everything or block so much that people find ways around them.
How approval procedures work
An approval procedure is a rule attached to one or more document types, such as sales quotations, sales orders, deliveries or purchase orders. When a user adds a document that meets the rule's conditions, SAP Business One holds it as a draft and sends it to the approvers defined for that rule. Once enough approvers accept it, the originator can add the document. If it is rejected, it stays a draft.
Each procedure has three parts:
- Originators: the users whose documents are checked.
- Stages: who approves, and how many of them must agree.
- Terms: the conditions that trigger the procedure. These can be standard terms, such as a credit limit or a discount percentage, or a saved query that returns a result when the rule should fire.
The query option is where most of the real value is, because it lets the rule reflect how your business actually works.
Five rules most distributors need
1. Credit limit
Stop sales orders and deliveries for customers who are over their credit limit or past due beyond your terms. The standard credit check compares against the business partner's balance; a query-based rule can include open orders and deliveries that have not been invoiced yet, which gives a truer picture of exposure.
2. Gross margin
Hold quotes and orders where the gross margin falls below a threshold, either for the whole document or for any line. This catches price overrides, outdated special prices and items whose cost has moved since the price list was last updated.
3. Discount authority
Give reps a discount they can apply on their own, and route anything beyond it to a manager. Different thresholds for different sales roles are easy to set up.
4. Purchase approvals
Require approval for purchase orders above a value, or for vendors outside an approved list. In companies where several people can raise purchase orders, this is the simplest control on spending.
5. Exceptions to process
Catch documents that break a rule of the business rather than a number: an order shipping from the wrong warehouse, a customer without a valid tax certificate, a delivery date outside the customer's receiving hours. These are almost always query-based.
Common mistakes
Rules that look at the wrong number. A credit check that ignores open deliveries will approve orders that should be stopped. A margin check that uses the item's last purchase price rather than its actual cost will flag the wrong lines.
Too many approvals. If managers approve dozens of documents a day, they stop reading them. Thresholds should be set so that approvals are exceptions, not routine.
No backup approver. When the only approver is on holiday, orders wait. Every stage should have someone who can step in.
Rules nobody can explain. Approval queries written years ago and never documented become a mystery when they start blocking orders. Every rule should have a short note: what it checks, why, and who asked for it.
Forgetting the mobile and web channels. If orders also arrive from a sales rep app or a customer portal, the same rules need to apply to them. Integrations that create documents through the supported interfaces can respect approval procedures; anything that bypasses them cannot.
Alerts: the lighter alternative
Not every rule needs to stop a document. Alerts send a message when a condition is met, without holding anything up: a large order from a new customer, a key account that has not ordered in a month, an item below its minimum stock. They are a good way to keep managers informed without adding friction for the sales team.
Getting it right
Start with the two or three rules that would have prevented your most expensive mistakes in the last year. Write down exactly what each should check, test them on a copy of the company with real documents, and tune the thresholds before they go live. Review them every six months: a rule that never fires, or fires on everything, needs changing.
Approval procedures are part of SAP Business One customization. Describe the rule you need and we will tell you how it can be built.