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Sales Pricing

It may be that an item's sales price depends on certain conditions that exist when the item is entered on a sales document. A common example is the customer for whom the sales order is placed - different customers or groups of customers are oftentimes afforded different pricing criteria. Pricing is also frequently determined for specific dates or periods of time. This may be a regular change (pricing is recalculated on a weekly basis based on changing material costs) or a particular circumstance (promotional pricing on a new product line for a 3 month period). Not only can sales pricing vary based on a single condition, but it may be that different pricing is defined for certain combinations of conditions (a single customer group receives certain pricing for a specific group of items over a particular period of time).

Microsoft Dynamics NAV gives the user the ability to define sales pricing according to a number of different criteria. Tools are also available to assist the user in quickly updating sales prices based on changing conditions or new data.

Sales Price Conditions

Prices are set up and maintained in the Sales Prices window. Both the conditions necessary for sales pricing to take effect and the pricing methods themselves are entered here.

Every sales price needs to be defined for a customer and item type. The available parameters extend beyond individual customers and items, however. For example, you can define a sales price for an entire customer price group or item category (including the hierarchy below). At the broadest level, a sales price can be defined for all customers or items. These pricing levels can be assigned in different combinations (sales pricing for a specific item that applies to all customers, for example).

Every sales price line must have a start date, which represents the date on which the sales pricing defined on the line takes effect. An ending date can also be assigned, but is not required if you want the sales pricing to continue uninterrupted until specified by a user.

Pricing Methods

You can define a number of different pricing parameters for a particular sales price. If there is a single value you want to assign, this can be set up as a fixed price.

You can also set up sales pricing that instructs the program to calculate a price based on a value called a cost reference. Examples of cost references are an item's standard, average, and last direct costs. You can enter the type of calculation you want the program to perform against a cost reference in order to obtain a sales price. For example, you might set up a sales price line that instructs the program to calculate an item's sales price by applying a percent markup to the item's last direct cost.

There is a unique type of cost reference called a cost calculation method. Cost calculation methods contain item costs from sources other than the various costs that are maintained in the Item table. Examples include external sources and values that are calculated from historical cost data. The options for instructing the program on how to obtain cost values and then calculate a cost reference support varying levels of complexity.

Contract Pricing

In many instances, a single sales order line may meet the conditions of multiple sales price records. If for example a sales price for Item A exists for the entire year, but a second sales price for the item category that includes Item A is set up for the month of July, a sales line for Item A in the month of July will meet the conditions of both sales prices. Please note that for pricing on item categories, the hierarchy is respected, meaning that children of a specific Item Category inherit the settings for that category.

In such a scenario, Microsoft Dynamics NAV's default behavior is to assign the Best Price to the item. Best Price represents the lowest possible price that meets the conditions of the sales line.

Best Price is not always an appropriate way to select an item's sales price. If a specific pricing arrangement is agreed upon with a customer, you will want to ensure that this arrangement is always used by the program when determining sales prices. You can achieve this by setting up a sales contract. The sales price lines for the items that are included as part of a sales contract are designated as contract prices. A contract price will always be used by the program, regardless of whether there are lower prices that also meet the conditions of the sales line. In addition, you can set rules that prohibit the customer from ordering non-contract items.

It is also possible to indicate that a sales price be treated as a soft contract price. A soft contract item will follow the program's standard Best Price rules, but still retains the contract designation, leading to its inclusion in any contract item-only rules that are established for the customer.

Sales Price Assignment

When a new sales order line is created, the program determines a sales price based on the existing sales price records that meet the conditions of the sales line. If one or more sales contracts exist, a list of these contracts is presented, and the user must select one to calculate a sales price. When no contract prices exist, the program uses Best Price rules to determine which price will be assigned to the sales line.

If a sales price is fixed, the program will enter the fixed price on the sales line. If the selected sales price contains a pricing method that involves a calculation, the program will calculate the sales price at the time the item is entered on the sales order.

When multiple sales prices exist for a sales line, you can select an alternative price to the assigned one by using the Get Price feature. The user can also always override all sales prices by manually entering a value in the Unit Price field on the sales line, if necessary.

Sales Price Maintenance

While changes to sales prices may be entered directly in the Sales Prices window, this can be tedious if there are a large volume of records that must be changed. For example, a company may update the sales prices of all items on an annual basis.

To facilitate the process of maintaining sales prices, you can use the Sales Price Worksheet to perform global pricing updates. After you have specified certain adjustment factors, the program will suggest new sales prices by applying these factors to existing prices. If these new prices are satisfactory, you can instruct the program to implement price changes by copying them from the worksheet to the Sales Price table.

The Sales Price Worksheet also gives you the ability to specify a set of pricing conditions, then copy sales pricing from an existing set of pricing conditions to it. This allows you to quickly set up sales pricing for a new record such as an item or customer if that pricing is the same as what exists for a current record.

Recurring Price Templates

Sales prices may be updated on a regular basis. For example, every Friday a company may calculate prices for the upcoming week.

You can set up recurring price templates for pricing scenarios that are updated according to a set schedule. These templates can then be used to create new sales price lines when necessary. The fields on the template are the same as those that appear in the Sales Prices window, and the entries that you make in them serve as default settings for the sales price lines that are generated.

In addition to these defaults, you can indicate the frequency with which sales prices from the template should be created. When you instruct the program to suggest recurring prices in the Sales Price Worksheet, the template's frequency settings are used to determine the start and end dates for the new sales prices.

Each recurring price template maintains a record of all existing sales prices that have been generated from it. This allows you to view complete pricing history on a template by template basis.