1. In-Memory Sales Advisor Implementation Guide
  2. Understanding Profit and Revenue Simulation

Understanding Profit and Revenue Simulation

Insight into revenue and profit drivers improves executive decision making for product pricing and reduces the risk of incorrect pricing. When sales executives can analyze "what if" scenarios, they gain visibility into factors that drive revenue and profit and make informed decisions on future pricing and sales. The variability of cost, price, and forecasts impact both profit and revenue. To analyze the impact of changes to these factors, executives must run multiple scenarios or simulations.

The JD Edwards EnterpriseOne In-Memory Sales Advisor solution provides real-time "what if" profit simulations. You can simulate changing cost and price conditions along with forecasted demand and sales history to view immediately the impact on revenue and profit. Analysis of "what if" scenarios using large volumes of data enables you to make quick and informed decisions. The Profitability Simulator program (P42X20) enables you to run and analyze simulations for a variety of changing conditions quickly without creating batch applications or custom reports. This eliminates the need to inquire on cost, price, and forecasts, export the data to a spreadsheet, and then create scenarios within the spreadsheet to determine how changes to these factors impact revenue and profit.

Profit and revenue simulation also enhances price management by providing you with the ability to simulate profit and revenue scenarios based on price and cost changes. You use the Profitability Simulator feature to:

  • Analyze sales history and forecast demand to facilitate product pricing.

  • Execute future price changes based on analysis.

  • Enhance price negotiations.

  • Improve customer relationships.

  • Improve price management.

You can enter item and customer information along with price and cost information to simulate price, cost, profit margin, revenue, and profit.