Pricing Renewal Plans

This section provides an overview of renewal pricing and lists the pages used to price renewal plans. Here are the steps required to set up PeopleSoft Enterprise Pricer for renewals pricing:

  1. Set up price list (optional).

  2. Set up price rules.

  3. Set up arbitration plan.

  4. Select price basis options for billing and revenue.

Page Name

Definition Name

Usage

Price List Page

EOEP_PRICE_LIST

Define a price list. You can set up price lists in multiple currencies and create start and end dates for each product's price.

Set up this page if you want to use the list price in PeopleSoft Enterprise Pricer instead of the product's list price.

Conditions Page

EOEP_CONDITION

Select the price-by fields, values for the price-by fields, and the operator that determines how the price-by fields are related to the transaction.

Formulas Page

EOEP_FORMULA

Define the actions that take place when the price rule conditions are met.

Arbitration Plan Page

EOEP_ARB_PLAN

Define how price rules apply to the base or list price when pricing a transaction.

Define Renewal Cycle page

CA_RNW_CYCLE2_PNL

Select the price basis options for billing and revenue.

PeopleSoft Contracts uses the PeopleSoft Enterprise Pricer to price renewals. The system uses the price returned from the PeopleSoft Enterprise Pricer multiplied by the quantity as the renewal amount for the new contract line.

You have ability to set up additional PeopleSoft Enterprise Pricer rules for your system. These rules provide you with greater pricing flexibility for calculating the renewal line amounts. With the additional rules set up for PeopleSoft Enterprise Pricer, you can specify the percent increase or decrease for the renewal cycle in addition to the price basis for billing and revenue and quantity. You specify the price basis for billing and revenue on the Define Renewal Cycle page. If the Separate Fixed Billing and Revenue check box is selected for the target contract of the renewal plan then you can select a Price Basis for Revenue amount else the value for this field will be same as the Price Basis For Billing field and the revenue amount will be same as the billing amount. A link on the Define Renewals Cycle page takes you to the Price Rules Maintenance page in PeopleSoft Enterprise Pricer, where you can enter the percent increase or decrease. The Renewals process uses the price returned from the PeopleSoft Enterprise Pricer multiplied by the quantity as the renewal amount for billing and revenue for the new contract line.

The renewal price can be based on one of the following price bases:

For Billing:

  • A renewal billing amount itself (you cannot increase or decrease this renewal amount).

  • Percent increase or decrease of:

    • Contract Line Billing Amount

    • Contract Line List Price

    • Contract Line Net Billing Amount

    • Then Current List Price

    • User-entered Amount

For Revenue:

  • A renewal revenue amount itself (you cannot increase or decrease this renewal amount).

  • Percent increase or decrease of:

    • Contract Line Revenue Amount

    • Contract Line List Price

    • Contract Line Net Revenue Amount

    • Then Current List Price

    • User-entered Amount

Note: The Revenue Amount Details will be same as the Billing Amount Details if the Separate Fixed Billing and Revenue check box is not selected for the target contract.

For pricing renewals, additional PeopleSoft Enterprise Pricer setup may be required. If you want to use the price increase or decrease option, you must set up the Price Rule and Arbitration Plan in PeopleSoft Enterprise Pricer for pricing to function correctly. If you select Then Current List Price for the price basis for billing or revenue on the Define Renewal Cycle page, you have the option to set up the Price List in PeopleSoft Enterprise Pricer. If you do not set up the Price List in PeopleSoft Enterprise Pricer, the PeopleSoft Enterprise Pricer returns the PeopleSoft Order Management product's list price. PeopleSoft Contracts uses the price returned from the PeopleSoft Pricer multiplied by the quantity for the renewal line billing and revenue amounts. Whether or not you set up additional PeopleSoft Enterprise Pricer rules, the system uses the price returned from the PeopleSoft Enterprise Pricer multiplied by the quantity as the renewal billing/revenue amounts for the new contract line.

When pricing manual renewals by clicking the Reprice button on the Define Renewal Cycle page, PeopleSoft Contracts passes the renewal plan, cycle number, product, and renewal start date to PeopleSoft Enterprise Pricer. The amount passed to PeopleSoft Enterprise Pricer differs for the various price basis for billing and revenue options:

  • If you select Individual for the Create Target Lines option, the system overwrites the value in the Billing Amount and Revenue Amount fields in the Target Lines grid on the Define Renewal Cycle page with the price returned from PeopleSoft Enterprise Pricer.

  • If you select Consolidated for the Create Target Lines option and the price basis for billing is Contract Line Billing Amount, Contract Line List Price, or Contract Line Net Billing Amount, the system overwrites the value in the Billing Amount field of the target line with the sum of the returned price of the source renewable contract lines.

  • If you select Consolidated for the Create Target Lines option and the price basis for revenue is Contract Line Revenue Amount, Contract Line List Price, or Contract Line Net Revenue Amount, the system overwrites the value in the Revenue Amount field of the target line with the sum of the returned price of source the renewable contract lines.

  • If you select Consolidated for the Create Target Lines option and the price basis for billing is Then Current List Price or User-entered Amount, the system overwrites the value in the Billing Amount field of the target line with the price returned from PeopleSoft Enterprise Pricer.

  • If you select Consolidated for the Create Target Lines option and the price basis for revenue is Then Current List Price or User-entered Amount, the system overwrites the value in the Revenue Amount field of the target line with the price returned from PeopleSoft Enterprise Pricer.

Note: You must click the Reprice button on the Define Renewal Cycle page to price the renewable contract lines before running the manual Renewals process (click the Approve button on the Define Renewal Cycle page).

The automatic renewals process passes the same parameters when calling PeopleSoft Enterprise Pricer as the manual process described previously.

Note: If the Separate Fixed Billing and Revenue check box is selected for the target contract and the price basis for revenue is User-entered Amount, then the Revenue Amount field is available for entry. If the Separate Fixed Billing and Revenue check box is not selected and the price basis for revenue is User-entered Amount, then this field will be display only and the value will be same as the Billing Amount field value.

Enterprise Pricer Pricing Elements

PeopleSoft Enterprise Pricer consists of pricing elements that you use to create your pricing structure:

Term

Definition

Price Lists

These enable you to select products and conditions where the price list applies to a transaction. During a transaction, the system either determines the product price based on your predefined search hierarchy for the transaction or the product's lowest price on any associated active price lists. This price is used as the basis for any further discounts and surcharges.

Price Rules

These define the conditions that must be met for the adjustments to be applied to the base price. Multiple rules can apply when conditions of each rule are met.

Warning! When setting up price rules for PeopleSoft Enterprise Pricer, select the Line option in the Rollup By field in the Rules Attributes section of the Formulas page. PeopleSoft Contracts supports this Line option only.

Arbitration Plans

These define how the price rules are to be applied to the base price when the transaction is priced.

See PeopleSoft Enterprise Pricer.

See Understanding Enterprise Pricer Implementation.

Price Basis for Billing and Revenue for PeopleSoft Enterprise Pricer

PeopleSoft Contracts price-by fields include: business unit, contract number, contract type, region code, sold to customer ID, address sequence number, product group, renewal plan, renewal plan cycle, ship to customer ID, and contract sign date. In addition, PeopleSoft Contracts also passes the product ID of the target line as part of the price-by fields.

The following table shows the information that passes back and forth between PeopleSoft Contracts and PeopleSoft Enterprise Pricer based on the price basis:

Price Basis for Billing/Revenue

Information Flow Between Contracts and Enterprise Pricer

Contract Line Billing Amount

Contract Line Revenue Amount

  1. PeopleSoft Contracts passes all Contracts price-by fields, renewal cycle start date, previous contract line start date, quantity, and contract line billing/revenue amounts for each renewable contract line to PeopleSoft Enterprise Pricer.

  2. PeopleSoft Enterprise Pricer uses the contract line billing/revenue amounts as the base price. PeopleSoft Enterprise Pricer uses the base price, price rule, and arbitration plan to calculate the billing and revenue amounts for the new contract line.

  3. PeopleSoft Enterprise Pricer returns the calculated price for each renewable contract line to PeopleSoft Contracts.

    • If you selected Individual for the Create Target Lines option, on the Define Renewal Cycle page, the system overwrites the Target Billing Amount and Target Revenue Amounton the grid with the calculated price. The calculated price becomes the renewal amount for billing/revenue of the new contract line. The Target Billing Amount and Target Revenue Amountfields on the grid are no longer accessible when this price basis option is selected.

    • If you selected Consolidated for the Create Target Lines option on the Define Renewal Cycle page, the system overwrites the Billing Amount and Revenue Amount on the grid with the sum of the calculated price. The calculated price becomes the renewal amount for billing and revenue of the new contract line. The Billing Amount and Revenue Amount fields are no longer accessible when this price basis option is selected.

    • If you are renewing multiple contract lines together to create a single contract and the start and end dates for the contract lines that are being renewed are different, the PeopleSoft Enterprise Pricer returns the same amount that PeopleSoft Contracts passed to the PeopleSoft Enterprise Pricer back to PeopleSoft Contracts.

Contract Line Net Billing Amount

Contract Line Net Revenue Amount

  1. PeopleSoft Contracts passes all Contracts price-by fields, renewal cycle start date, previous contract line start date, quantity, and contract line net billing/revenue amounts for each renewable contract line to PeopleSoft Enterprise Pricer.

  2. PeopleSoft Enterprise Pricer uses the contract line net billing/revenue amounts as the base price. PeopleSoft Enterprise Pricer uses the base price, price rule, and arbitration plan to calculate the renewal amount for billing and revenue amounts for the new contract line.

  3. Same as Step 3 for Contract Line Billing Amount and Contract Line Revenue Amount.

Contract Line List Price

  1. PeopleSoft Contracts passes all Contracts price-by fields, renewal cycle start date, previous contract line start date, quantity, and contract line list price for each renewable contract line to PeopleSoft Enterprise Pricer.

  2. PeopleSoft Enterprise Pricer uses the contract line list price as the base price. PeopleSoft Enterprise Pricer uses the base price, price rule, and arbitration plan to calculate billing and revenue amounts for the new contract line.

  3. Same as Step 3 for Contract Line Billing Amount and Contract Line Revenue Amount.

Then Current List Price

  1. PeopleSoft Contracts passes all Contracts price-by fields, renewal cycle start date, quantity, and previous contract line start date for each renewable contract line to PeopleSoft Enterprise Pricer.

  2. If you defined the list price for the product in PeopleSoft Enterprise Pricer, PeopleSoft Enterprise Pricer uses the PeopleSoft Enterprise Pricer list price based on the start date of the cycle as the base price. If you did not define the list price in PeopleSoft Enterprise Pricer, the system uses the product's list price based on the start date of the cycle as the base price. PeopleSoft Enterprise Pricer uses the base price, price rule, and arbitration plan to calculate the billing and revenue amounts for the new contract line.

  3. Same as Step 3 for Contract Line Billing Amount and Contract Line Revenue Amount

User-entered Amount

  1. If you selected Consolidated for the Create Target Lines option on the Define Renewal Cycle page:

    • PeopleSoft Contracts passes all Contracts price-by fields, renewal cycle start date, previous contract line start date, quantity, and the user-entered billing/revenue amount for each renewable contract line to PeopleSoft Enterprise Pricer.

    • PeopleSoft Enterprise Pricer uses the user-entered billing/revenue amount as the base price. PeopleSoft Enterprise Pricer uses the base price, price rule, and arbitration plan to calculate billing and revenue amounts for the new contract line.

    • PeopleSoft Enterprise Pricer returns the calculated price for each renewable contract line to contracts.

      The system overwrites the Billing Amount and Revenue Amount with the calculated price. The calculated price becomes the renewal amount of the new contract line. The Billing Amount field is accessible. The Revenue Amount field is accessible if the Separate Fixed Billing and Revenue option was selected for the target contract of the renewal plan.

    • If you are renewing multiple contract lines together to create a single contract and the start and end dates for the contract lines that are being renewed are different, the PeopleSoft Enterprise Pricer returns the same amount that PeopleSoft Contracts passed to the PeopleSoft Enterprise Pricer back to PeopleSoft Contracts.

  2. If you selected Individual for the Create Target Lines option on the Define Renewal Cycle page:

    • PeopleSoft Contracts passes all Contracts price-by fields, renewal cycle start date, Previous Contract Line Start Date, Target Billing Amount, and the Target Revenue Amount in the grid on the Define Renewal Cycle page for each renewable contract line to PeopleSoft Enterprise Pricer.

    • PeopleSoft Enterprise Pricer uses the Target Billing Amount and Target Revenue Amount as the base price. PeopleSoft Enterprise Pricer uses the base price, price rule, and arbitration plan to calculate the billing and revenue amounts for the new contract line.

    • PeopleSoft Enterprise Pricer returns the calculated price for each renewable contract line to contracts.

      The system overwrites the Target Billing Amount and Target Revenue Amount in the grid with the calculated price. The calculated price becomes the renewal amount of the new contract line. The Target Billing Amount field in the grid is accessible. The Target Revenue Amount field is accessible if the Separate Fixed Billing and Revenue option was selected for the target contract of the renewal plan.

Note: If you do not set up the price rule and arbitration plan in PeopleSoft Enterprise Pricer, Step 2 in the preceding table does not occur. Instead, PeopleSoft Enterprise Pricer returns the same amount for each renewable contract line that PeopleSoft Contracts passed to PeopleSoft Enterprise Pricer back to PeopleSoft Contracts.

Note: In all of the above cases, the revenue amounts are not passed to PeopleSoft Enterprise Pricer if the Separate Fixed Billing and Revenue option is not selected for the target contract of the renewal plan. Instead the billing amount returned by PeopleSoft Enterprise Pricer is also used for the revenue amount.