Cost-Plus Pricing
You can price based on a price other than a list price, such as cost or alternate cost. Previously, all pricing calculations, such as discount or surcharge, were based on list price. The list price came either from the price list or the list price of the product. Now, the system must first determine the base price for pricing calculations.
If the order line is associated with a buying agreement, then the base is always the buying agreement price.
Cost-plus pricing enables you to set up a price rule to indicate the pricing base based on certain conditions. If no price rule is matched to the transaction line, then the list price is used as the base price. If matching price base price rules exist, then the arbitration plan of the order is used to filter and sort the matching rule to determine the base. If no match to the arbitration plan exists, then the list price (the default) is used.
The arbitration plan should have a node with a price rule type of pricing base, ideally as the first top-level node in the tree. It can have only one of these decisions as its child:
Use Highest Base: Compare list price and cost, and use the larger as the pricing base.
Use Lowest Base: Compare list price and cost, and use the smaller as the pricing base.
Use Cost as Base: Use cost as the pricing base.
Use List Price as Base: Use list price as the pricing base.
Use Alt Product Cost: Use an alternate product cost as the pricing base.
After determining the base, the other matching price rules are processed and the selected base is used for all the pricing calculations. However, several additional flags on the price rule specify whether or not the rule applies to transaction lines with a specific pricing base:
Applicable to List Price flag: When enabled, indicates that the price rule applies to transaction lines using list price as the pricing base.
Applicable to Buying Agreement: When enabled, indicates that the price rule applies to transaction lines using a buying agreement as the pricing base.
Applicable to Cost Base: When enabled, indicates that the price rule applies to transaction lines using cost as the pricing base.
Applicable to Alt Cost Base (Applicable to Alternate Cost Base): When enabled, indicates that the price rule applies to transaction lines using alternate cost as the pricing base.
For example, if the pricing base for a specific transaction line is cost, then a matching price rule that is not applicable to cost as a base is ignored.