Special Pricing Terms and Concepts

This section describes the terms and concepts that are used when describing the Special Pricing System.

The purpose of the Special Pricing System is to allow you to set up various types of pricing in order to calculate a “target” price for each customer, item, quantity and optional contract# combination during the order entry process.  The Special Pricing routines are used by all programs that are used to create sales orders, including manually entered orders and orders that are generated from EDI information.  The Special Pricing System supports several different pricing methods and the methods can be used in combination to handle simple or more complex pricing strategies.

The following sections provide a brief description of the special pricing terms and concepts.  The various pricing options available in the system are described in more detail in later sections of this document.

Customer – The Customer for whom the sales order is being processed.  StreamV uses the BillTo Company or Customer name when determining which prices are available for the quantity, item and contract# being entered on a specific sales order.

Buying Group – A Buying Group is a group of customers that are associated together for the purposes of receiving the same pricing.   Stream allows you to set up Buying Groups and assign customers to them.  Customers are added to and removed from Buying Groups using the Buying Group Master Program.  A customer may belong to multiple buying groups, in which case the system will check all special prices for all buying groups the customer is a member of.  Special Pricing and Rebate records can be entered for buying groups and the special pricing and rebate records for these buying groups will be available each time an order is processed for one of the customers assigned to the group.  The use of Buying Groups allows you to maintain fewer records in the special pricing file for items that can be sold to groups of companies at the same price. This eliminates the need to repetitively set up the same pricing information for each company.

Customer Price Level – The Price Level assigned to the customer in the Customer Master file.  The Price Level field in each customer record is a required field and each customer must be assigned a price level that corresponds with the valid Inventory Price levels described later in this section.  The customer price level defaults into the sales orders, quotes and loaners that you enter for each company.  The operators’ ability to set the customer price level to something other than the value in the Customer record during order entry is based on the field security settings for the operator.  Normally the operator is not allowed to edit the field in the order entry program.  The price level being used for each sales order is passed to the price module when calculating the target price for the order line.

Customer Discount – Each record in the Customer Master file contains a discount field.  If a positive discount percentage is loaded into this field (10 for 10%) and a price level of from R-9 is used for the order, the system will adjust the inventory price level price by the discount percentage in the customer record when calculating the discounted price level price for the customer/item being processed.  If the price level being used is ULSN (indicating that you are selling at cost), the system will use the discount percentage as a markup percentage.  The customer discount percentage defaults into the sales orders, quotes and loaners that you enter for each company. The operators’ ability to set the customer discount percentage to something other than the value in the Customer record during order entry is based on the field security settings for the operator.  Normally the operator is not allowed to edit the field in the order entry program.  The discount percentage level being used for each sales order is passed to the price module when calculating the target price for the order line.

Inventory Price Level – The simplest type of pricing used by the system is based on the price levels that are stored in the Catalog and Inventory Master Files.  Each inventory item in each inventory location stores 11 price levels and 5 different costs that can be used to default the price for each customer/item combination.  Each customer record in the system can be assigned to one of these price levels, or costs (costs would normally be used when selling between different sites owned by the same company, or when selling to a customer on a cost plus basis).   During order entry, the customer price level will be used by the special pricing system in the absence of other special pricing records for the customer and item number being processed.  The price calculated by using inventory price levels is known as the Price Level Price.  The table below lists the valid price levels and costs supported by the special pricing system. 

Price Level	Inventory Master field the price is pulled from
R	Retail Price level
1-9	Price Levels 1 through 9
A	Price Level 10 (A)
U	Unit Cost
N	Next Cost
L	Last Cost
C	Commission Cost
S	Standard Cost

Prices File – The Prices file (File 107) is a database file that allows you to define foreign currency price level information for your inventory items.  Records can be created in the Prices file for each location, item number, currency, and price level combination that you need to support.  If present, these Prices records are used in place of the Inventory Price Levels when a Sales Order is processed in a currency other than your local or house currency.  If a sales order is processed in a foreign currency and there are not Prices records for the item and currency being processed, the system will automatically calculate the price for the order line using the local or house currency price level and the most recent exchange rate in the system for the currency being processed.

Basis Price/Price Level Price – The price the customer qualifies for based on the price level being used for the order (normally this is the same as the value set in the customer master) and the inventory price levels for the item being processed.

Discounted Basis Price/Discounted Price Level Price - This is the Basis Price with the discount/markup from the order (normally this is the same as the value set in the customer master) applied to it. If the price level specified in the customer record is a cost based price level (U,LN,S, or C) the discount percentage is used as a markup percentage (i.e. the percentage is used to increase the cost level price instead of to decrease it).  This option is commonly used to allow sales to a customer on a "cost plus" basis.  If the price level specified in the customer master is R, 1-9, or A, the discounted price is the price level price less the discount percentage.

Special Price – Special Price records are the price and the rebate records that are created and maintained in the Special Pricing or SPECIAL file (File 72).  Special Pricing records are used to handle unique situations for particular items, company/item combinations/ or buying group/item combinations.  Contract Prices, Sale Prices, Buying Group Prices, GSA prices, and Quantity Prices are all examples of special pricing records and they are all stored in the Special Pricing File.   Rebate records are also stored in the Special Pricing file.  Special Pricing records are normally used to override the prices calculated using the inventory price level and customer discount information.  When a special pricing record is processed by the system and selected, the fields in the special pricing record that are used depend on the type of the record selected.  For example, if a contract price is selected as the target price, the price from the special pricing record is applied to the order line being processed.  If a rebate amount, a cost, or a commission cost is specified in the special pricing record, this information is also applied to the sales order line being processed and carried through the system to the invoices generated from the order.  The PQDS, CD (Class Discount) and the Force flag in the Special Pricing record are also used to determine if the price in the record should be adjusted based on PQDS or Class Discount information and to determine if the price should be forced into the sales order line even if it is not the lowest price available for the customer.  The various types of special pricing records are discussed in greater detail in later sections of this document.

Contract Price – Each Special Price record contains a contract# field that can be manually or automatically loaded by the system.  The contract number in each sales order line is loaded with the contract from the special price record when the special price is selected as the price during the order entry process.  The difference between a contract price and a special price is primarily in the way the price is selected.  If a contract number is specified during order entry and passed to the price module object, the special pricing system will search ONLY for qualifying prices with the specified contract number.  If a contract number is not specified, the system will search through all qualifying prices for the item, quantity, customer combination when calculating the target price for the order line.

Sale Pricing – Sale Pricing is used to make a sales price available for an item for all customers due to the item going on sale.  Sale Prices are setup and maintained in the Special Pricing File SPECIAL (File 72).  Sale prices are automatically selected by the system when appropriate, and they cannot be selected manually during order entry.  Sale price special price records must be set up with a status of Active. 

Quantity Pricing – Quantity Pricing is used to set up Quantity based pricing for an item and to make it available for all customers.  Multiple Quantity Prices can be set up for an item in the Special Pricing file, and these records can be used to reduce the price for the item based on the quantity being ordered.  For example, you may charge 10.00 for an item when quantity one is ordered and 9.00 if the customer orders a quantity of 5 or more, 8.00 if the customer orders 25 or more, etc. Quantity prices are automatically selected by the system when appropriate, and they cannot be selected manually during order entry.  Quantity price special price records must be set up with a status of Active.

Pallet Group Quantity Pricing – Pallet Group Quantity Pricing allows you to apply quantity pricing to a group of similar products.  Pallet groups refer to groups of items that can be ordered together to qualify for quantity pricing.  For example, a customer may have to order 48 cases of a sports drink to get the quantity price, but the customer can select how many cases of each flavor they are buying..  Pallet group pricing allows the customer to mix cartons of different flavors to get to the 48 case quantity required for the quantity price.  The items that can be grouped together

GSA Pricing – GSA or (General Services Administration) Pricing is used to handle government pricing requirements.  GSA prices can be set up in the Special Pricing file, and customers who qualify for GSA pricing can be identified using the GSA flag in each customer record.  The GSA prices are then available to any customers who have the GSA flag set to Y in the customer record. GSA prices are automatically selected by the system when appropriate, and they cannot be selected manually during order entry.  GSA price special price records must be set up with a status of Active. 

Buying Group Price – A Special Price record that is set up for a buying group and that is available for the defined members of the buying group.  Buying group prices can be set up with a status of Active (taken automatically by the system where appropriate) or Standby (selected manually by the operator when the order being entered qualifies for the price. 

Active/Standby Prices - Some Special Price records and Rebate records can be set up as  Active (Status A) or Standby  (Status S).  Special Pricing records can also be set Inactive (Status I). 

Active Special Price records are automatically used by the system during the Target Price Calculation when the order line in question qualifies for the price (based on the item, quantity, beginning and end dates, customer and optional contract# being processed). 

Standby Special Pricing records are not automatically used by the system but are shown to the user as “available” when the sales order line item being processed qualifies for the price.  The operator can then manually select the price when required based on the situation. .Standby Special Pricing records are typically used in situations where the price is only available to the customer in certain situations. 

Example 1 - You sell an item to a dealer who sometimes has you ship it to normal end users and sometimes has you ship it to an educational institution    If the Special Price is only available when the item is sold to an educational institution, a standby special price record could be created for the dealer to handle this situation.  The Standby special price would be selected only when the item is being shipped to the educational institution. 

Example 2 – You sell an item to the same customer at two different prices, and the lower price is only available for orders entered against a specific contract number.  If a standby price is setup, the price will be available in order entry but will only be used if the operator selects the price manually (by using the mouse, or by keying in the contract number during order entry.

In general, Standby Special Prices must be selected during order processing based on organic intelligence (the user decides whether or not taking the rebate is appropriate based on the circumstances).  There are also options that allow you to have the system automatically convert a standby rebate to active during processing and this option can be used to automatically take a standby rebate for a particular customer during EDI order processing.  This option is described later in this document.  Inactive special price records are ignored by the system during processing.

Rebates – Manufacturers and vendors will sometimes offer to refund a portion of the purchase price of an item to your company after the item has been sold to your customers.  This refund amount is referred to as a rebate.  The Rebate processing system is used to record the rebates that you qualify for as each sales order line is entered into the system and to handle the tracking of the rebates due to your company.  The Stream system allows you to specify stand-alone rebate records (which are applied on top of manufacturer, price level, discounted price level or manufacturer prices), or it allows you to specify a rebate amount in other types of special pricing records (such as GSA, Company or Buying Group special price records).  Stand-alone Rebates are supported at the global (general rebate for all customers), customer specific, and at the buying group level.  Rebates can be set up to adjust the commission cost and price of the order line being processed when the rebate is available for the order, or they can be set up so that the system only records the rebate and does not adjust the price or commission cost of the order line. 

Instant vs. Non Instant Display – The ID or Instant Display field in the Special file is used by the system when a General, Company Specific, or a Buying Group rebate is selected (automatically or manually) during order processing.  The Instant display field is used to determine if a rebate amount should be subtracted from the price and the commission cost of an order line when the order line qualifies for the rebate.  The Instant Display field essentially determines if the rebate is passed to the rep – so they can optionally lower the price being charged for the item (instant display= Y), or if the rebate is only recorded and then taken by the company (instant display=N)

Force Flag – The Force field in the Special Pricing file allows you to tell the system to force a price to be used even if it is not the lowest price available for the customer, item, and quantity being processed.  If the system selects a valid special pricing record during order processing and the Force flag in the record is set, the system returns the price from the Special Pricing record and it does not check for any other available prices for the order line.  The force flag is not used by Rebate or Type R Special Pricing records.

Commission Cost – The cost to be used when calculating the commissions for the order line.  The Commission Cost field is saved to each sales order line and it is used for running commission reports and for paying sales reps.  The Commission Cost in each sales order line can come from the commission cost that is defined in each inventory item, it can come from the inventory commission cost adjusted by a rebate (if the instant display field in the rebate record is set to Y), or it can come from the Commission cost specified in a special pricing record (if the field is loaded in the special pricing record).

Cost – The cost for the order line.  The cost field in each order line is used during the sales posting process if the cost field is loaded and the rebate field is not.  The Cost field in the sales order is loaded when a cost is specified in a special pricing record and the special pricing record is selected as the price during order entry.  When the cost in an order line is specified and the rebate amount is not specified, any difference between the cost in the order line and the average cost of the item at the time the sales is posted, is posted to a rebates receivable account by the system.  The cost amount is used for the cost of sales amount and the current or average cost for the item (from inventory) is used to for the adjustment to inventory by the sales posting process.  If a vendor ship is being processed, the system uses the cost from the vendor ship PO for the current cost and the cost for the invoice line and a rebate will only be recorded when the rebate field in the invoice is loaded (your inventory average cost is not relevant when a vendor is shipping product directly to your customer).

Manufacturer Pricing – StreamV allows you to set up pricing based on the manufacturer that is defined for each item in the Product Catalog and the Inventory Master files.  Manufacturer pricing is set up and maintained using the PRODAUTH File (File 109).    The records in the Prodauth file can be set up for individual customers or they can be set up for a specific buying group of customers.  The system will calculate both the best customer specific and buying group manufacturer prices and it will return both of them (if applicable) to the target pricing routines.  Manufacturer prices can be specified at the manufacturer level (all items that have the specified manufacturer as the manufacturer in the Inventory Master file), at the manufacturer product line level (only items that belong to a specified Product Line and that are assigned to the specified manufacturer in the Inventory Master file), or at the manufacturer, product line, and group level (only items that belong to the specified Product Line, and the specified Product Group, and that are assigned to the specified manufacturer in the Inventory Master file)

Manufacturer Buying Group Pricing – Manufacturer Prices that have been defined for a specific buying group or group of customers. Manufacturer Buying Group Pricing is set up and maintained in the PRODAUTH file (File 109).

Class Discount – Class Discounts are percentage discounts or surcharges that can be applied to the prices that are calculated by the system.  Class Discounts are created and maintained in the Class Discount Table or PROGDISC file (File 210).  Class discounts are applied to special price records when the Class Discount field in the Special Price is set to Y.

Class Discount Tables – The Class Discount Tables can be used to set up additional discounts or surcharges for items assigned to specific product lines and groups which are purchased by individual companies or members of a specified buying group.  Records are set up using the entity (company or buying group) and the item product line and /or group that is to be adjusted.  During processing, the system checks a system parameter to determine if the price it has calculated should be adjusted using the PQDS  (price quantity discount system) and if so, the system attempts to find a record in this table for the item being processed.  The table is searched first for a record matching the company (or buying group the customer is assigned to) and the product line and class for the item being processed.  If this is found it is used.  If no match is found, the system then checks the company and inventory class.  If this is found, the information in the record is used.  If no match is found there, the system then checks the company and inventory product line being processed.  If a match is found it is used.  If the system finds a valid match for the item being processed, the target price is adjusted by the discount (or surcharge) percentage and this price is returned back to the pricing system.

Class Exception Tables – The Class Exception Tables are used to handle items that are assigned to a specific class for inventory purposes and need to be included in a different class for pricing purposes.  For example: If you had a class discount set up for class C inventory items and you wanted to exclude one or more of the Class C inventory items from receiving the class discount, you could accomplish this using the Class Exception Table.  Records would be created in the Table for the items to be excluded from the Class C discount.  The records would include the location, item number and class to be used for pricing purposes.   Once these records have been created, the pricing system would use the class in the Class Exception Table for pricing purposes instead of the class assigned to the item in the Inventory Master File.

Class Price – Class Pricing is based on the Class Discounts that are defined in the Class Discount Table or ProgDisc File (File 210).  Class Discounts can be set up for a specific Customer/Inventory Product Line/Inventory Class combination, for a Customer/Inventory Class combination, Customer/Inventory Product Line combination, or for a specific Customer and all items.  The Class Price calculation will pick the most specific Class Discount Available during processing

Buying Group Class Price – A Buying Group Class Price is based on the Class Discounts that are defined in the Class Discount Table or PROGDISC file (File 210). Class Discounts can be set up for a specific Buying Group/Inventory Product Line/Inventory Class combination, for a Buying Group/Inventory Class combination, Buying Group/Inventory Product Line combination, or for a specific Buying Group and all items.  The Buying Group Class Price calculation will pick the most specific Buying Group Class Discount Available during processing

PQDS – Price Quantity Discount System – The PQDS system allows you to apply quantity adjustments and or value adjustments to the Target Prices Calculated by the System.  System parameters allow you to specify which type of prices should be adjusted by the PQDS calculations.  Options allow you to apply or not apply PQDS adjustments to price level, discounted price level, or contract prices.  There is also a PQDS flag in each special pricing record which can be used to enable or disable PQDS adjustments for special price records (excluding rebates) on a record by record basis.  The Quantity Adjustment and Value Adjustment Tables described in the next sections are part of the PQDS system.

Quantity Adjustment Tables – The Quantity Adjustment Tables can be used to set up additional discounts or surcharges for items assigned to specific product lines and item classes which are purchased by individual companies or members of a specified buying group.   The discounts or surcharges in this table are based on the company (or buying group), the item class and/or product line, and the quantity of the item being sold to the company.  This differs from the Class Discount Tables, which are not based on the quantity being sold.  Records are set up in the Quantity Adjustment Tables using the entity (Company or Buying Group, SALE, QUANTITY or GSA) and the item product line and or item class that is to be adjusted.  Multiple records can be set up in the table for each combination of company, item class, and product line to allow you to specify the appropriate quantity breaks.   For example: a single company can be set up to receive a 5% discount when buying quantity 1 of an item.  Additional records can then be set up to automatically give the company a 10% discount when they buy a quantity of 10, a 20% discount when they buy a quantity of 100 and so on.

During processing, the system checks a system parameter to determine if the price it has calculated should be adjusted using the PQDS (price quantity discount system) and if so, the system attempts to find a record in the Quantity Adjustment table for the item being processed.  The table is searched first for records matching the company (or buying group the customer is assigned to) and the product line and class for the item being processed.  The quantity is also used during the search to find the record in the table with the quantity that is equal to or less than that being entered on the sales order. If a matching record is found, it is used and the price of the order line is adjusted by the factor in the Quantity Adjustment record.  If no match is found, the system then checks the company and inventory class, again searching for the appropriate quantity.  If this is found, the information in the record is used.  If no match is found there, the system then checks the company and inventory product line being processed searching for a record with the appropriate quantity.  If a match is found it is used as explained above.

Value Adjustment Tables – The Value Adjustment Tables can be used to set up additional discounts or surcharges for items purchased by individual companies or members of a specified buying group. The discounts or surcharges in this table are based on the company (or buying group), the item class and/or product line, and the total value (extended price) of the sales order line for the item being sold to the company.   Records are set up in the Value Adjustment Table using the entity (Company or Buying Group, SALE, QUANTITY, or GSA) and the item product line and or item class that is to be adjusted.    The value that must be sold to qualify for the discount (or surcharge) is also entered in each record along with the discount or surcharge applicable for the sale.  During processing, the system checks a system parameter to determine if the price it has calculated should be adjusted using the PQDS (price quantity discount system) and if so, the system attempts to find a record in the Value Adjustment Table for the item being processed.  The table is searched first for a record matching the company (or buying group the customer is assigned to) and the product line and class for the item being processed.  If this is found it is used.  If no match is found, the system then checks the company and class.  If this is found, the information in the record is used.  If no match is found there, the system then checks the company and product line being processed.

Target Price – The price that is displayed during order entry as the suggested sales price for an item, quantity, customer, and optional contract# combination.  The Target price is normally the lowest price available to the customer based on the item and quantity ordered, the item product line and class, and the order value.  The Target price for each order line is saved to the order line as reference information regardless of if the target price is actually used as the actual price for the order line.

Target Price Source – The source or calculation method used for the Target Price.  As each order line is entered and the Target Price is calculated, the system records both the Target Price and the Target Price Source – which indicates where the target price was obtained.  A listing of the valid Price Sources used by the system is presented in a later section of this document.

Price – The Price actually charged to the customer.  The price can be the same as the target price, or the price can be different than the target price if the operator has overridden the system calculated target price.

Price Source – The source of the price on the order line – this will be the same as the target price source if the target price is accepted, or it can be a different price source if the operator has manually entered a price or selected a price other than the target price suggested by the system.

Price Record Number – The record number from any special price record that was used for the order line.  Each sales order line stores a Price record number and this field is loaded when the price on the sales order line is obtained from a special price record.

Rebate Record Number – The record number from the special price record (this can be a rebate or another special price record type with a rebate amount), where the rebate amount for the line was obtained.  The rebate record number field will normally be loaded with the same value as the Price Record Number field if the price on the order is obtained from a special price record with a rebate amount in it.  The rebate record number will normally point to a rebate record if the price on the order was not obtained from a special pricing record (i.e. when the price record field is not loaded).

Classes to Consider – The StreamV Special Pricing System normally uses a system parameter called SOTARGET to determine which special pricing routines or pricing options should be used when calculating the target price for an order line.  There is also an advanced option that allows you to define the pricing options to be used for a specific customer.  A record can be set up in the LONGCODE file (File 18) to define the special pricing classes to be considered when processing orders for the specified customer.  If this SpecialPricingClasses Longcode record is present, the system will use the information from the Longcode record instead of the SOTARGET parameter to determine the price calculations to be used by the system when processing an order for the customer specified in the record. 

Include Standby Rebates – In most situations, the system will automatically select the best (highest) Active status rebate for the customer, item and quantity being processed during order processing.  If a Standby or status S rebate is also available for the order line, the standby rebate must be selected manually in the order entry program.  In some situations such as EDI processing, sales orders are generated automatically without user interaction, and standby rebates cannot be selected manually.  To deal with situations where a standby rebate needs to be selected for a specific customer automatically, StreamV allows you to create a record in the Longcode file that will cause the system to treat a status S or standby rebate as a status A or Active rebate.  If an F054DETL “SpecialPricingStandbyFlag” Longcode record is present for the customer being processed, the system will check the record to determine if it should treat standby rebates or prices or both as active records.  If the Longcode record is set to B (both), the system will treat any standby rebates or prices that are available for the order line as active.  If the Longcode record is set to R (rebates), the system will treat standby rebates as active, but it will treat standby prices as standby.  If the Longcode record is set to P (prices), the system will treat standby prices as active, but it will treat standby rebates as standby.

Include Standby Prices – In most situations, the system will automatically select the best (highest) Active status rebate for the customer, item and quantity being processed during order processing.  If a Standby or status S rebate is also available for the order line, the standby rebate must be selected manually in the order entry program.  In some situations such as EDI processing, sales orders are generated automatically without user interaction, and standby rebates cannot be selected manually.  To deal with situations where a standby rebate needs to be selected for a specific customer automatically, StreamV allows you to create a record in the Longcode file that will cause the system to treat a status S or standby rebate as a status A or Active rebate.  If an F054DETL “SpecialPricingStandbyFlag” Longcode record is present for the customer being processed, the system will check the record to determine if it should treat standby rebates or prices or both as active records.  If the Longcode record is set to B (both), the system will treat any standby rebates or prices that are available for the order line as active.  If the Longcode record is set to R (rebates), the system will treat standby rebates as active, but it will treat standby prices as standby.  If the Longcode record is set to P (prices), the system will treat standby prices as active, but it will treat standby rebates as standby.

AutoMinGPM – This option, which is enabled by creating records in the LongCode File, causes the target price calculation to use the minimum GPM from the Inventory record during target price calculations.  If the prices being calculated by the price module are below the minimum GPM for the item, the system over-rides the calculated price with a price that matches the minimum margin that has been specified for the item

Minimum GPM Over-ride on Manufacturer Pricing – This option, which is enabled by creating records in the LongCode File, causes the target price calculation to use the minimum GPM from the Inventory record during manufacturer price calculations.  If the manufacturer price is below the minimum GPM for the item, the system over-rides the manufacturer price with a price that matches the minimum margin that has been specified for the item

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Pricing Options