You can use this business function to create your own price types for your materials. This enables you to undertake various price calculations and simulations, so achieving an improved margin cost accounting (Controlling).

Margin cost accounting is a prerequisite for optimizing the control of the sales organization with the profitability of the products in mind, which in turn enables an increase in profitability for the entire enterprise to be achieved.

As sales markets are frequently characterized by low profit margins and are often subject to price fluctuations of raw materials and commodities, it is a significant competitive advantage to be able to analyze the effects of price fluctuations using additional prices, updated based on time. You can create your own price types and enter prices. You can then use these in the material costing or link with the balance sheet valuation using the appropriate methods. You can save the results of these calculations in other price types.

By regular cost estimates based on market prices, you can achieve increased cost transparency regarding the sensitivity of your product margins to changing market prices of components and marketable products.

The use of this business function provides you with a detailed overview and history to the nearest day. You can compare prices from differing sources and at different dates with each other. Further, the transfer of material prices from these customer price types as a future price for a material is supported, that you can then release as the new valuation price for a material.

If you use the actual costing based on the material ledger (price determination 3), the standard price for the material must remain constant for the whole period.