If you have only encountered AVC in passing, you might be wondering: what exactly can it handle in SAP S/4HANA Cloud, Public Edition? That is the question I want to answer today — not with a feature list, but with a look at the real business processes it supports.

It starts with a model, not a product

The foundational idea behind AVC is deceptively simple: instead of maintaining a separate master record for every possible product variation, you maintain one configurable product model that captures all the rules, dependencies, and pricing logic. A bicycle manufacturer does not need two thousand SKUs for every combination of frame size, colour, gear system, and accessory package. They need one model — and AVC handles the rest.

In SAP S/4HANA Cloud, Public Edition, this approach is supported across a wide range of business processes. Let me walk through each of them.

Make-to-Order: where AVC earns its reputation

The scenario most closely associated with AVC is Make-to-Order production with variant configuration. A customer selects their configuration in a sales order. AVC validates it against the characteristic values and dependencies defined in the model, generates the correct bill of materials and routing, and passes that directly into production. No manual translation. No re-entry of requirements. What the customer ordered is exactly what manufacturing builds.

This is the core process for industrial machinery, specialty equipment, and any product where the customer's specification and the production order must match without interpretation in between. In SAP scope terms, this is the LS1 scenario — and for many companies, it is the reason they implemented AVC in the first place.

Make-to-Stock: configuration without a customer order

Not every variant business runs on individual customer orders. If you produce configurable products in advance — for example, pre-configured machines at standard option levels that you know will sell — AVC supports this through material variants. You define a specific combination of characteristics as a material variant, plan and produce against it, and sell from stock when the order arrives.

This approach works well where lead times need to be short, where demand patterns are predictable, or where a small set of popular configurations covers the majority of your sales volume. It gives you the modelling power of AVC without the wait times of pure Make-to-Order.

Engineer-to-Order: built for unique, complex orders

Engineer-to-Order with AVC is the right fit for capital equipment, infrastructure components, or any scenario where each order is genuinely unique and requires dedicated dedicated oversight. The configuration becomes the foundation for everything that follows — from procurement to delivery.

Two more processes worth knowing

AVC in the Public Edition does not stop at the two core scenarios. There are two additional processes that extend its reach further.

Solution bundling allows you to combine multiple configurable products into a single customer offer. When a customer is configuring a system made up of several independently-configurable components — a production line, a modular installation, a hardware and software bundle — solution bundling lets you manage the whole as one coherent offer rather than a collection of separate line items.

Advanced intercompany sales processing supports AVC configurations that span company codes. If a configuration entered in one legal entity needs to flow through the intercompany supply chain to a delivering entity in a different country, AVC ensures the configuration is carried correctly across that boundary — which matters both for accuracy and for pricing.

Analytics that speak the language of configuration

Configurable products generate rich operational data — which characteristic combinations are most commonly selected, which options drive the longest lead times, where production deviations occur most often. AVC in SAP S/4HANA Cloud, Public Edition includes embedded analytics that surface configuration-relevant KPIs, giving product managers and operations teams the visibility they need without building custom reports from scratch.

This is one of the areas where the public cloud delivery model makes a real difference. Reporting capabilities are part of the standard scope, updated with each release, and available to every customer on the platform.

What is in scope — and what is coming

Across all these processes, AVC in SAP S/4HANA Cloud, Public Edition is supported by fifteen dedicated scope items — a number that has grown steadily as SAP has continued to invest in this area with each release. The roadmap points toward further AI-driven enhancements and expanded integration with adjacent processes, and we will cover those developments in a future post in this series.

If your business deals in products that are configured rather than simply selected, AVC is worth a careful look. The question is not whether your use case is supported — the chances are good that it is. The question is where to start.

For that, I would point you to the SAP Help Portal for AVC and to the first post in this series, which covers the conceptual foundations that make all of this possible.