1. Administering Pricing
  2. Example of How Pricing Algorithms Price Items, Other Setups

Example of How Pricing Algorithms Price Items, Other Setups

Learn how pricing algorithms do other calculations.

Apply Pricing Terms for Sales Agreement

If you set up Order Management to use sales agreements, then the algorithm uses the agreement to apply pricing terms.

Here are the SDOs.

Apply Pricing Terms for Sales Agreement

Note

  • The output SDO from the Calculate Net Price step provides the input SDO.

  • The running unit price in the input SDO is 480.

  • Pricing applies adjustments from the sales agreement before it applies adjustments that the pricing strategy specifies. So, it runs this step immediately before it applies adjustments from the pricing strategy in the Calculate List Price step.

  • The TermSetup entity contains the rule that you specify on the sales agreement in Contract Management.

  • You use Order Management and Contract Management to set up the agreement, including terms that specify price, such as discounts. For details, see Overview of Setting Up Sales Agreements in Order Management.

  • The running unit price in the output SDO is 480 minus the 100 discount equals 380.

Here's what the Apply Pricing Terms algorithm does.

  1. Find matching charges.

  2. Get the pricing basis.

  3. Apply simple adjustments.

  4. Process other adjustment types.

  5. Apply tiered adjustments.

  6. Apply matrix adjustments.

  7. Process the TermCustomAdjustmentFlag attribute.

  8. Process errors in the sales agreement.

The flow is similar to the Calculate List Price step except you can use only a simple rule or matrix rule with a sales agreement. You can't use a tier rule.

For details about the functions you can use, see the Apply Discounts from Pricing Strategy section, earlier in this topic.

Here are details about attributes in the SDOs.

Entity

Attributes in Input SDO

Attributes in Output SDO

ChargeComponent

-

 
ChargeComponentId: 5
ChargeId: 1
CurrencyCode: USD
ExplanationMessageName: QP_SALES_AGREEMENT_ADJ
ExtendedAmount: -200 USD
PriceElementCode: QP_SALES_AGREEMENT_ADJ
PriceElementUsageCode: PRICE_ ADJUSTMENT
PriceValidFrom: 2019-05-29 @ 05:55:29
SequenceNumber: 1004
SourceId: 300100176714435
SourceTypeCode: PRICING_TERM
UnitPrice: -100 USD

The Unit Price attribute contains the $100 discount that the sales agreement specifies.

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