This page provides summary of the Formula Expressions used for the Price Guidance Compliance Agent.
Potential Revenue
Definition
A hypothetical incremental revenue amount that would result if the margin rate were changed from the current margin rate to a new target margin rate, assuming the same cost base.
Formula
Potential Revenue = Current Revenue * ((1-m%current)/(1-m%new) – 1)
-
m%current – current margin percentage
-
m%new – new / suggested margin percentage
Potential Profit
Definition
A hypothetical profit level that would be achieved on the current revenue base if the margin rate were improved from the current margin rate to the new (target) margin rate.
Formula
Potential Profit = Current Revenue * (1-m%current)/(1-m%new) – Current Profit
Threshold Unit Margin
Definition
The guidance value used for compliance (chosen from the Negotiation Guidance floor/target/ceiling for unit margin), optionally adjusted by a user‑defined offset in the compliance criteria.
Formula
Recommended Unit Margin + Offset
Current Unit Margin
Definition
The profit per unit realized at the current level. Conceptually gross margin divided by quantity.
Formula
Gross Margin / Quantity
Suggested Unit Margin
Definition
The proposed unit margin obtained by moving from the current unit margin toward the guidance threshold.
Formula
Current Unit Margin + p × (Threshold Unit Margin − Current Unit Margin)
p is Closer to Threshold by.
Difference to Threshold
Definition
The amount by which the current metric (e.g., unit margin) deviates from the selected guidance threshold (floor/target/ceiling, including any configured offset). Positive values indicate the current value is below the threshold when “higher is better” (e.g., unit margin), and negative values indicate it is above.
Formula
Threshold Metric − Current Metric