Use

You use this function to control how the system calculates prices or price components for commodities.

You need this function if you buy, sell, or trade commodities and you have made agreements with your business partners that a product’s net price is calculated based on complex rules that use real stock market and currency data. The complex rules constitute a formula, whereby the input part controls the evaluation of the commodity price, and the output part is the result of the evaluation.

Integration

During formula evaluation, the system uses several pieces of input data to calculate a formula rate and a formula value. The following input data is used:

Formula input data

Document data:

Product quality data (such as quantity information)

Reference data (such as goods issue date)

Business objects

Customizing/Master data:

Price quotations based on stock market prices

Exchange rates

Calendar functions

The formula output data consists of:

Formula rate

Formula value

For each term, a rate or value

For each term, other evaluation details

The system transfers the formula rate and formula value that result from the formula evaluation to pricing as the condition rate and condition value of the corresponding pricing condition type. For more information, see Integration of Commodity Pricing in ERP Pricing .

The formula evaluation is integrated into SD sales documents, MM purchasing documents, and the trading contract. The system transfers the business attributes in these documents to formula evaluation.

Prerequisites

The prerequisites of Integration of Commodity Pricing in Price-Relevant Documents apply.

If you use a sales process that starts in SAP CRM, you have made the necessary settings for the ERP system in the SAP Solution Manager.

Features

Formula evaluation has the following features:

Unlimited number of terms

Unlimited number of period determination rules (one per term)

Handling of fixed prices at formula and term level

Possibility to manually overwrite the determined price

Operators between terms not limited to addition

Calendar for stock market can be configured

Rules to handle floor and ceiling prices

Absolute and percentage surcharges possible

Calculation can be based on single quotation type (such as Arabic Light) or a quotation type group (such as the average of Arabic Light, Brent, West Texas Intermediate (WTI))

Possibility to calculate prices with reference to prices in other documents

Conversion and rounding of rates or prices during calculation of commodity prices

Configure at which calculation step a rate or price is to be converted and rounded (for example, USD per barrel into EUR per ton). Such a conversion step is called conversion place.

Configuration of rounding and rate conversion at three levels (formula, term, and conversion place-specific)

Conversion place-specific configuration for rounding and rate conversion (rate conversion = combined currency and quantity conversion)

Configuration of sources for quantity conversion factor (for example order quantities, material movement quantities, formula-specific quantities)

Activities

When processing pricing-relevant business transaction items, the system automatically performs formula evaluation in the background.