Pricing: Calculating Sales Prices 

In sales price calculations, you can create or change sales prices for several articles and organizational levels at once in a single operation. When you start the program, the results of these calculations are displayed in the maintenance screen of sales price calculation (pricing table). The list group determines whether article data (article numbers, and so on) or organizational level data appears in the pricing table header. Any pricing items for which the system was unable to calculate sales prices (perhaps because the required master data was not maintained) are written to an error log. This log also contains pricing items for which prices could be calculated but for which warning messages were generated nevertheless (for articles with a suggested retail price, for example). The default values that the system calculates for the prices on the basis of various purchasing and sales parameters (purchase/sales price determination sequence, calculation schemas, and so on) can be manually overwritten, if necessary. A detailed description of the pricing table and explanatory notes on the various entries that you can make can be displayed from the pricing table menu.

There are two ways to save the results. The generation of a pricing document allows you to store the calculation results without activating the prices. Saving the sales price calculation, on the other hand, means that the sales prices calculated are written straight to the database as condition records with the relevant validity period. In Customizing you can define whether the system should automatically generate a corresponding pricing document when a sales price calculation is saved.

If sales price calculation results in the generation of a pricing document, the pricing document items have status A. If the pricing document is generated automatically when you save the sales price calculation, the items have status C.

To be able to create sales prices, you must have appropriate authorization. The system distinguishes between authorization to carry out calculations and authorization to activate prices. The authorization to carry out calculations always applies to a specific pricing level (distribution chain, price list, site) and is also merchandise-category-dependent.

For each sales price calculation you must specify the articles and the organizational levels to which the sales prices are to apply. Article selection can be restricted according to merchandise category, or according to one of the vendor sub-assortments and/or a season. You can, for example, select all the articles for vendor 1000 that begin with the letter A (enter A*) that belong to the merchandise category Beverages. You can specify the following organizational levels: distribution chains, sites or site groups, and price lists (site price lists and price lists for customers). If, for example, you want to calculate sales prices for a distribution chain but with different prices for one of its sites, you enter both the distribution chain and the site on the selection screen. If you have chosen list group A, then the site will have its own pricing item at the level below distribution chain level. The same method can be applied to sites and site groups or price lists and distribution chains. However, you cannot simultaneously select a distribution chain and sites that do not belong to it, for example. It is also not possible to calculate sales prices for distribution chains and site groups at the same time in sales price calculations.

When sales prices are being calculated for distribution chains, price lists or site groups, the system must refer to reference site master data in order to perform functions such as source determination. (See also Pricing: Source Determination.) For distribution chains and price lists, the reference site is maintained in Customizing when you assign pricing types to organizational levels; for site groups, the first site (alphabetically) in the group automatically becomes the reference site.

The system performs the following steps to calculate sales prices for each item:

1. Determining the purchase price

First, the system analyzes the purchase price determination sequence you have specified on the selection screen. The system applies different methods to determine the purchase price depending on the purchase price determination type defined and its parameters. If source determination is defined, for example, the system searches for distribution centers and/or external vendors, taking the source of supply key maintained in the article master record into account.

Following this, the purchase price for the external vendor is calculated using a purchase price calculation schema. For distribution centers, the system searches the master data for the warehouse transfer price.

If no transfer price exists for the distribution center and prices are not being calculated for this distribution center in this run, a price calculation for the distribution center is performed in the background and the resulting value is used as the delivered price.
  1. Determining the sales price (gross, net)

As was the case in determining the purchase price, the sales price determination sequence you select determines the method used here. The various sales-side factors required are calculated using a sales price calculation schema. In markup calculation, for example, the sales price is calculated on the basis of the purchase price and a planned markup. This type of calculation can be observed with the sample calculation schema WWS001 supplied with the standard system (here, direct sales costs and sales tax are also taken into account). A special pricing currency can be defined for use in price calculations; sales prices (gross, net) are then displayed in this currency in the pricing table. You define the pricing currency when you maintain the pricing type in Customizing.
  1. Determining the rounded sales price (final price) in the sales currency

If the sales currency and the pricing currency differ, the sales price is converted into the sales currency. If price point rounding is defined, the (converted) sales price is rounded to a price point defined in the price point group. This version of the sales price is designated as the final price. In price point rounding, the new value is displayed and the actual markup is recalculated. The sales price calculated using the planned markup can be displayed as the planned final price.
  1. Calculating margins

The system calculates margins (net, gross) as the difference (in percent) between the sales price (net, gross) and the purchase price (net/net purchase price).
  1. Pricing data for retail prices

In two-step price calculation for wholesalers, the system also determines the retail price, the actual retail markup and the retail margin (see sample calculation schema WWS002).

The sales price calculation maintenance screen (pricing table) displays the results of sales price calculations in a format defined by the relevant list variant. The standard list variant supplied by SAP (01) includes the following fields calculated during pricing:

In Customizing you can create one or more list variants for the maintenance screen for sales price calculations. You can change a list variant on the selection screen for sales price calculations by going into the maintenance screen for sales price calculations. (See Pricing: List Fields and List Variants in Sales Price Calculations)

The sales price calculation maintenance screen is interactive. This means that if you change the values in the fields that are ready for input and press ENTER , a new price calculation will be performed for every item changed, taking the changed field into account. If, for example, the vendor is changed (you can display the vendors found in source determination by pressing F4), the sales price for the item with the changed vendor is completely recalculated. If the actual markup is changed, the system uses the same purchase price as before to recalculate the sales price, but with the new markup. If the purchase price is changed, either the actual markup or the sales price will be adjusted in the new calculation or the planned markup will be applied, depending on settings made when maintaining the pricing type in Customizing. For further details, please see the help documentation on the maintenance screen. In the following examples, the key terms used in sales price calculations are put into context.

The current net/net purchase price for article X is 10 USD. The planned markup has been set to 5%. Before rounding to price points and taxes, the suggested sales price is 10.50 USD. The actual markup is the same as the planned markup. If you change the actual markup to 10%, the final price on the screen will change to 11 USD. The margin is adjusted from 4.7% to 9.1%. If you add taxes at 15%, the final price will be 12.08 USD initially, and after the actual markup is changed it will be 12.65 USD.

The net/net purchase price for article Y is 8 USD and the suggested gross sales price is 10 USD: The actual markup is 25%, the gross margin 20%. If you change the (gross) margin to 50%, the system will recalculate the sales price at 16 USD, and the actual markup after the change is now 100%.

In the first example, price point rounding could cause the calculated 10.50 USD to change automatically to 10.99 USD. In this case, the actual markup deviates from the planned markup, and would be 9.9%. See also: Pricing: Price Points.

If you change the calculated sales price in the Gross SP field, the system will round your entry up or down to a price point defined in the price point group. However, if you change the entry in the Final Price field, the system will not recalculate to the nearest price point. This way you can specify sales prices which are not rounded to price points.

In two-step price calculations for distribution centers and the stores they supply, there will be a row on the maintenance screen for sales price calculations for the distribution center along with rows for its associated stores. Changes to data in a distribution center row will affect calculations for its related stores. For instance, if you change the distribution center transfer price for an article, you are also changing the purchase price for the stores. The system therefore recalculates the store sales prices (retail prices) on the basis of the new purchase price.

The retail price can be automatically printed on delivery notes for merchandise shipped from the distribution center to the stores. The delivery notes will then show the different articles in the shipment, quantity per article, the retail price for each, and totals. This way the store manager can see at a glance the total expected revenue for the shipment, broken down by article. It also helps the store personnel who must put individual price labels on the articles when stocking the shelves.