Pricing Dimension Structures and Value Sets
You can segregate standalone sales into sets of similar transactions called pricing dimensions.
You identify the pricing dimensions by analyzing the pricing policies of your goods and services. The pricing policy takes into account multiple factors when determining customers' discount eligibility, such as the deal size and customer type. Pricing dimensions are used to categorize the standalone selling prices.
After you identify your pricing dimensions, you group them as segments of a pricing dimension flexfield structure. Define as many pricing dimension structures as you need by creating unique groups of pricing dimensions. Pricing dimension structures are shared by all of the goods and services that use the pricing dimensions included in the structure.
The pricing dimension values are included by default in all sales transactions imported into Revenue Management. The combination of pricing dimension values assigned to a transaction is called a pricing dimension combination. Pricing dimension combinations are used to categorize standalone sales. The transactions are segregated in the standalone sales pool using the pricing dimension combinations. All transactions in the sales pool that have the same pricing dimension combination are grouped into one set for calculation and establishing the standalone selling price.
When determining the standalone selling price for a transaction that's part of a performance obligation, Revenue Management first assigns the pricing dimension combination to the transaction and then derives the standalone selling price based on the pricing dimension combination.
Example:
The following table shows an example of a pricing dimension structure with three pricing dimensions:
|
Geographic Region |
Customer Type |
Deal Size |
Standalone Selling Price |
|---|---|---|---|
|
North America |
Government |
1,000,000 USD to 4,999,999 USD |
17% |
|
North America |
Government |
5,000,000 USD to 9,999,999 USD |
21% |
|
North America |
Commercial |
1,000,000 USD to 4,999,999 USD |
17% |
|
North America |
Commercial |
5,000,000 USD to 9,999,999 USD |
21% |
|
North America |
Commercial |
10,000,000 USD or more |
32% |
In the example, each pricing dimension must have a set of pricing dimension values. The table shows that the Customer Type pricing dimension has two unique values: Commercial and Government. The standalone selling price is established using a 17% discount for the following pricing dimension combination:
-
Geographic region: North America
-
Customer type: Government
-
Deal size: 1,000,000 USD to 4,999,999 USD
Similarly, standalone selling prices are established for the other four pricing dimension combinations.