Transaction Tiering
You can use transaction tiering to calculate outgoing royalties when the system must consider the order of the transactions to assign them to scale levels (tiers).
For examples of the main use cases for transaction tiering, see the following:
Prerequisites
You have made the settings in Customizing for Customer Relationship Management
under 
Industry-Specific Solutions
Media
Intellectual Property Management
Transactions
Configure Transaction Tiering
.
Features
When trasaction tiering is active, the system can calculate royalty rate using one of the following methods:
As a percentage of the sales volume, whose value is scaled according to the number of units sold
For example, royalties of 8% are awarded for sales of the 1st to 1000th unit, while royalties of 10% are awarded for sales of the 1001st unit onward.
As a percentage of the sales volume, whose value is scaled according to the total money received
For example, royalties of 8% are awarded for saled up to $10,000, while royalties of 10% are awarded for sales above $10,000.
As an amount whose value is scaled according to the number of units sold
For example, royalties of $0.80 per unit are awarded for sales of the 1st to 1000th unit, while royalties of $1.00 per unit are awarded for sales of the 1001st unit onward.
For a list of condition types available for transaction tiering, see Customizing activity Configure Transaction Tiering
(see path above).
You can also create your own condition type for transaction tiering. See Customizing for Customer Relationship Management
under Industry-Specific Solutions
Media
Intellectual
Property Management
Billing and Settlement
Outgoing Royalties
Define Condition Types for Transaction Tiering
.
Shared Tiering
Shared tiering refers to transaction tiering with multiple royalties or rights and royalties scope items in a tiering group. In this case, the system uses a common scale basis
, which means that it fills up the scale levels based on all transactions assigned to
any of the royalties or rights and royalties scope items belonging to this tiering group, taking into account the order in which the transactions occur.
Scale level thresholds for shared tiering
The scale level threshold is the maximum number of units sold before the system refers to the next tier level when calculating royalties. The scale level threshold for each item in the tiering group can be the same or they can be different.
Sorting
In the standard system, the transactions are ordered by transaction date. You can, however, change this or add other sorting criteria by customizing the billing engine sorting usage of the IPM: Transaction Tiering
(IPM_TIER
) feature.
For instructions on how to change the sorting, see Customizing activity Configure Transaction Tiering
(see path above).
Scale Validity
You can have a single set of scale levels valid throughout the entire contract or you can have multiple validity periods with different scale levels.
Each day of the contract must be covered by a validity period
Validity periods cannot overlap
If you are using differential billing, you can only change the royalty amount between validity periods. However if you are using any other type of billing, you can change the scale items entirely.