This article explains how SalesPRO calculates the pricing for line items in Order Entry.
We will begin in order entry, and review how pricing is calculated in various scenarios.
Price Breakdown Window
The Price Breakdown is found as the last tab on the Edit Product Item window. To open the Edit Product Item window, double click on any line item from within the Quote/Sale/Order, or after entering the product details on the Options tab, simply click on the Breakdown tab. The Price Breakdown gives us a detailed look at how pricing is calculated for a line item.
We will look at this window in more detail by zooming in on each of the 6 areas defined above.
The detailed price lines for the item (which show the product and surcharge costs) is shown by clicking on the plus sign (+) next to the label Before Discount Cost; click on the minus sign (-) to hide the detail.
This shows the cost (MSRP) of this product, before Vendor discount. In this case, the MSRP is $1,678.00.
Underneath the first section, we see the Vendor Discount. In this example the seller receives a Vendor Discount of 58.75%. This discount is set up in the Discounts window, a subject that will be covered in Managing Vendor Discounts.
The Vendor Discount, in this case, brings the seller's COST down to $692.18. This is the amount that the seller will have to pay for this product.
Continuing down the lines in the Price Breakdown Window, we come to the Base Retail Price. This amount is calculated by taking the Seller's COST, from above ($692.18), and adding the Seller's margin. This margin is also set up in the Discounts Window. In this example, the seller has a margin of 50%. This margin will double the seller's cost to make the Base Retail Price $1,384.35.
Note: The percentage here can be overridden by clicking directly on the percentage and typing in a new one.
The next lines are Item Price Adjustments and Rounded Price.
Item Price Adjustments
This can be an installation charge, shipping charge, or a measure charge that is added directly into the line item instead of showing up as a separate line item on the quote. In this example a Trip charge of 5% has been added to the line item. These charges are set up in Item Price Adjustments on the Maintenance Tab. This subject is covered in How to Set Up Price Adjustments in SalesPRO. These charges are invisible to your customers.
The next line is Rounded Price. You can choose to round Item Prices up or down, and choose how much to round them. This is set up in 'Customer Types' from the Maintenance Menu. In this example, the seller has chosen to round up the item price to the nearest 9. This means that the retail price (after Item Price Adjustments) will be rounded up to the nearest number that is evenly divisible by 9. In this case, the price is changed from 1453.57 to 1458.00.
Note: If you have set your company up to NOT round prices, this line will NOT show up in your Price Breakdown tab of Order Entry.
The next line is Customer Discounts. Customer discounts are also set up in the Discounts window from the Maintenance menu. The percentage shown on the Breakdown tab of Order Entry can also be changed by clicking on the percentage and typing in a different one, or typing in 0 to give no discount.
In this example, the seller has given this customer a 30% discount, bringing the price down to 1,020.59. This discount will be visible to your customer if you use the "Retail Quote" to for presentation.
The last line (before the Total) on the Breakdown tab is an Item Discount. This discount is any extra discount you would like to add to this line item. This could be a promotional discount (i.e. Free Cordless or Labor Day Sale). It can be a percentage or a dollar amount, although we recommend that it be used only to enter flat rate dollar amounts. To enter a percentage into this field make sure you type in a number with the % sign after it. To add a flat dollar amount simply type in the dollar amount you want discounted.
We will not utilize the Item Discount in this example.
This brings us to the Price (Total) line. This simply gives the price that the customer will pay for this line item.
NOTE: The Breakdown tab in Order Entry does not give the profit margin information. This can be found back in the Edit Quote/Sale/Order window.
Click on the Small "i" in the lower right hand corner to bring up the Proft/Margin Breakdown window.
- The [P] button at the bottom left of the window will turn on and off the Customer and Item Discounts, so they may be viewed or modified from any tab.
- Taxes are not presented with the product pricing. They are totaled for all line items on the EDIT QUOTE/SALE/ORDER window.