DM08: Define standard discounts & surcharges

Sales Manager / Account Executive

Business Objective:

Define and maintain discounts and surcharges easily across customer segments, regions, sales channels etc.

Conditions are set and maintained in ERP system without overall transparency and simulating the impact.

Flexible creation & simulation of discount frameworks allowing for local differences while providing global transparency.

• Flexibly considering business-relevant criteria for price differentiation which is not limited by existing data structures in systems

• Efficient creation, simulation, and execution into ERP

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Currently, the process of setting up price discounts and agreements for customers is very manual in most process industry players. This can lead to errors, lack of transparency, and potential misalignment in the type of discounts or agreements that different customers in the same segment might be receiving. However, there's an opportunity to improve this process by defining the criteria and conditions that customers need to meet to access these types of discounts. This allows us to create differentiation in a more flexible way and communicate it back into the ERP system. Some of the benefits of this approach include improved accuracy, increased transparency, and better alignment with pricing policies and regulations. Additionally, this can help streamline pricing processes and improve overall efficiency.

Let's take a look at how we can do this in Pricefx.

If you're looking to set up a standard discount policy for your customers, the first step is to navigate to the agreements and promotions component within the price effects system. From there, you can set up a new program using a default template and give it a name.

You can also adjust the start and end dates as needed. While you can set up specific customers, in this case, we'll be setting up specific products in the definition of our standard discount.

To do this, navigate to the item section in your agreement. Within the system, there are several condition types that allow you to set up different types of promotions and discounts for your customers.

For a standard discount, select that condition type. Once added to the list, the system will prompt you to define what that standard discount is.

If you're interested in sending out this discount for a specific set of products in the market, you can adjust the settings accordingly. This will allow you to create a more targeted and effective discount policy for your customers.

To set up the standard discount, we'll navigate to the product master and utilize the available data attributes. In this case, we'll use the Level of Competition attribute to automatically select products that face significant competition in the market.

Next, we'll specify the discount percentage, let's say 10%. After making these changes, we can recalculate the impacts using the calculation section.

If you are satisfied with it, you can submit it for review and approval. This ensures that the standard discount aligns with our objectives and meets the necessary criteria.

Step 3: Approval workflow

After submitting the program, you can review the Workflow tab to understand the levels of approval needed. In this case, it requires two levels of approval, so we'll go ahead and approve it.

Once the agreement has been approved, we can export it to a PDF and send it to other parts of the organization. This can be done via email directly from the system, and you have the option to use a template that contains information related to this discount policy. By specifying email addresses and using a specific template, we can ensure that the information is delivered accurately and efficiently. This helps streamline communication and ensure that everyone is on the same page regarding the new standard discount policy.

With this we can conclude the flow for how to define standard discounts & surcharges for the process industry in Pricefx.